What are These Inspections of Which You Speak?

Property inspections

So, the offer’s all signed and executed, we have a Contract for Sale, we’ve all said, “Yay!” and now those pesky people from Nannup Real Estate are wittering on about inspections. What’s all that about?

When we draw up our standard Offer and Acceptance form (which becomes a Contract once all parties have signed off, so from now on we’ll refer to it as the Contract) for the sale of a property with a dwelling or other structure on it, we always include provision for a termite clearance. In many cases we will also recommend a building inspection and every Contract includes a pre-settlement inspection (this last is part of the standard conditions found in the Joint Form of General Conditions for the Sale of Land, a copy of which you will be given when we first start sending documentation around.)

Building inspections are highly recommended for older dwellings. The purpose of a building inspection is to identify and remediate structural defects which may not be immediately apparent to the buyer, seller or real estate agency. Building inspections (and their subsequent reports) are made at the buyer’s expense by a licensed builder and the report remains the property of the buyer, but must be provided to the seller by the date specified in the Contract. If the report identifies structural defects, then the buyer has three business days to serve a Structural Defects Notice on the seller. This notice gives the seller five business days to agree to remedy the defects listed on the notice. That’s not five business days to fix everything, that’s five business days to agree to it. This time is there to give the seller time to do things like obtaining estimates for the work. If the seller doesn’t agree to fix the problems, then the buyer can terminate the contract and get their deposit returned to them. If the seller does agree to fix the problems, then settlement may be delayed to allow the work to be done.

Another option for buyer and seller is for the parties to renegotiate the purchase price by an agreed amount and for the seller not to do the remediation work.

Termite Inspections are always recommended when a dwelling is being purchased in the south west region due to naturally high levels of termite activity from the endemic termite species found here.  The standard termite clause requires a report at the buyer’s expense being obtained no later than 14 business days before settlement. The report should include a certificate from a licensed pest control operator certifying that all structural improvements are free from termite activity on the date of the inspection and stating whether such inspection disclosed damaged occasioned by previous termite activity, and the extent and nature of such damage.  If this report discloses termite activity or damage and the seller at their own expense is unable or unwilling to rectify the problem then the buyer has seven days in which they may decide to terminate the contract and get their deposit back.

The Pre-Settlement Inspection is usually carried out in the week leading up to settlement and is designed so that the buyer can satisfy themselves that the property is in the same condition as it was when the decision to buy was made. The buyer should be checking fixtures and all those items which are included in the sale. It is important that all parties be clear about what is to be left, what is to be taken and that the property is left in the same condition as it was when viewed with the real estate agent.

Other inspections which may take place can include a visit from a Licensed Valuer if the Contract is subject to finance. The Valuer needs to visit the property and inspect it on behalf of any potential mortgagee.

If you are buying or selling property and have any questions about the process, you can ask us here at Nannup Real Estate.



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