Is your Contract subject to a Building and Pest Inspection?
Here are 6 things you need to know about building and pest inspections when purchasing property.
You must use professionally qualified inspectors to prepare the reports
The inspection must be carried out by someone who is licensed by:
- Building and pest inspector – the Queensland Building and Construction Commission
- Pool inspector – by inspectors licensed by the Pool Safety Council
If they are not licenced, you cannot use the report to terminate the contract.
Building inspection reports will identify any existing defects and areas of concern in the Property. The report is not a warranty against any future defects. We strongly recommend that you are present when the building inspection is done, so you can talk to the inspector about the scope of the inspection and ask the inspector any questions you have about the property.
A pest inspection report is different to a building report. While a building report should identify any visual damage that may have been caused by termites, it usually won’t identify the existence of termites or other timber destroying pests. We recommend that you get a separate pest report from a licensed pest inspector. The pest report should also include:
- what termite management system has been installed at the property; and
- whether the property is in a high risk area for termites.
You must act reasonably
You must take all reasonable steps to obtain the report/s by the due date and you must act reasonably in deciding whether a report is satisfactory. If you are not satisfied with the results of your building or pest report, the only right you have is to terminate the contract. The report must reveal a significant problem for you to have the right to terminate. You do not have a right to reduce the purchase price or to require the seller to carry out any works. However, a seller may be prepared to reduce the price or repair an identified problem rather than lose the sale.
Buyers can be required to provide a copy of an unsatisfactory report
If you want to terminate your contract because you are not satisfied with a building or pest report, the seller has the right to request a copy of the report. The seller can then determine if the buyer’s concerns are reasonable. You should ensure that you provide a copy of the report to your conveyancer.
Strata schemes and community title properties
This position is slightly different for units and other strata properties. Building inspectors only inspect and assess the condition of the interior and immediate exterior of the unit you are intending to purchase. We recommend that a special condition be inserted in the contract to make the contract conditional on the buyer obtaining a satisfactory Body Corporate Records Inspection. The inspection of the Body Corporate Records will identify any issues the Body Corporate has experienced in relation to the entire building not just the unit you are purchasing.
If you would like assistance with your property purchase or for your contract to be reviewed prior to signing, please contact our Property Team.