Why Do I Need A Building And Pest Inspection?

On page 3 of the standard Contract of Sale in Queensland, about halfway down the page, there’s a clause that refers to a Building and Pest Inspection Date.

Having dealt with Contracts for what seems like a lifetime, this type of Clause, its meaning and implications come as second nature to me, but for many first home buyers, it’s clauses like this that can leave one stumped asking the inevitable questions, What The? and Why?

Why do I need this? What even IS this, and how does it affect me as the Buyer?

Deciphering Contracts is never easy, especially if it’s your first time seeing one of these types of Contracts.

You might want to seem like you know what you’re getting yourself into, but the problem I see time and time again with first home buyers is that they’re just plain afraid to ask what seem like the simple questions. 

They don’t want to feel dumb and so they don’t bother asking.

But in real estate, dumb is smart. Remember this. 

It’s OKAY to ask questions and plenty of them. You’re spending A LOT OF MONEY. You want to get it right!

One of the first things I say to clients is there are no stupid questions in real estate. 

It’s a minefield for anyone, new or experienced and in my 20 years in property, I’m still learning new things when it comes to buying, selling and all things real estate. 

After all, legislation is constantly changing and the way we communicate and transact in the industry is forever moving in new directions. 

So with that said, lets get back to what this Clause actually means.

Firstly, YES, you DO need to arrange a Building and Pest inspection whenever you’re buying property, EVEN if the property is brand new. 

There are very rare occasions where I suggest this step is by-passed by a Buyer, but as a rule of thumb, you need to get one done and you need to understand how this Clause applies to you when you buy property.

Don’t let the selling agent convince you of otherwise, or shove an already prepared Building and Pest Report under your nose. You want an UNBIASED, UP TO DATE report from a professional, registered and reputable inspector, who will give you an accurate report of what is going on with that property.

I’ve seen an agent pass off a Building and Pest Report that was six (6) months old as gospel. 

Trust me, a LOT can happen to a house in six months!

Now when it comes to this Clause on the Contract, you need to make sure you put a firm date in the space beside “Inspection Date”.  For example, 1st July 2018.

As an alternate, you can opt to insert the following wording instead of a firm date: “7 business days from the Contract Date”, or something to this effect.

Now remember, this timeframe or date that you insert is super important. It means you need to get your inspections organised and reports received with enough time for you to read through them and identify any bad stuff well before this time elapses. 

For example, if your Contract is dated 1 July 2018 and your Building and Pest Inspection Date is 7 business days from the Contract Date, then you need to have your reports arranged before the seven business days is up. 

Why business days?

You don’t have to use business days, but I do this because it buys you extra days if there are weekends and public holidays shoved in there.

You will need to talk to your solicitor, or conveyancer or whoever is representing you legally in this purchase and discuss whether or not you want to proceed with the purchase or not. You, or your legal representative need to let the seller know of your intentions to proceed, terminate the Contract or renegotiate the Contract on or before the date you set in this Clause.

Remember, if there are problems with the property that have been identified in the building and pest report, this is not necessary a reason for you to pull out of the Contract, hence why I mentioned the words “renegotiate the Contract” above.

Many things (provided they are minor enough) can be renegotiated at this point and it is often I will look to renegotiate the Contract (such as ask the sellers to lower the price by the amount of the repairs required) if there are issues with the property found within the reports. 

So to recap, YES you need to arrange a Building and Pest Inspection Report (even if the property is brand new), and you need to be mindful of the date that is set for this clause. 

If in doubt, always talk to your solicitor or an independent Buyer’s Agent who can help you. 

The selling agent is not always the best person to go to when we’re dealing with the Building and Pest Inspection Reports because remember, they represent the interests of the Seller. 

Definitely keep them in the loop, but have your private conversations in conjunction with the Inspector, your solicitor, and Buyer’s Agent (if you’re working with one).

The Building and Pest Report is designed to show you exactly WHAT you are buying when it comes to the condition of the property, and even save you from buying a property where there is just too much work to be done to fix it up. 

As an extra, I will always recommend my clients get an Electrical Report in addition to a Building and Pest Report. 

An Electrical Report will tell you if the switchboard needs to be replaced, whether the air conditioning units are working and whether the hot water service is about to go, amongst other electrical matters affecting the property. I strongly suggest you arrange one of these reports also to cover yourself even further. 

For more help like this, you can REGISTER for my First Home Buyers E-Course which will cover all the steps involved in buying your first property in an easy to follow way. 

I’ll be releasing this Course in the coming months and am taking early-bird discounted registrations now. 


PropertyWendy RussellComment