In Dirty Harry, Clint Eastwood famously asks: “Do you feel lucky, punk?”
But luck shouldn’t come into it when you’re sinking your retirement funds into an investment property.
Rather, you need to know whether the property you’re considering buying is worth its price tag or if it’s a potential money pit.
Enter the pre-purchase building and pest inspection – an essential part of your due diligence.
Why do you need a building and pest inspection?
The property might have looked great during the open home. But it’s amazing what can be hidden by a spot of fresh paint or a well-placed rug. Building and pest inspections shine a spotlight on a property to find out if it’s riddled with termites or has major structural shortcomings that could cost a fortune to fix.
What do inspectors check?
In an inspection, a qualified professional should examine all accessible areas of the property, including the roof and underfloor space. They’ll be looking out for signs of significant structural movement, major water penetration, faulty wiring or deterioration in the building materials used.
After carrying out this assessment, the inspector will write a report that includes:
- An overview of any structural issues found
- An insight into whether the faults can be repaired (and, if so, an estimated cost)
- Whether any hazardous materials or unsafe areas were identified
A pest inspection is carried out separately. While this usually means an additional cost, it’s nothing compared to the havoc termites can wreak on the building’s foundations.
Make sure the building and pest inspector you work with has full professional indemnity insurance. This means if they miss anything in their assessment, you are protected.
How much do inspections cost?
There isn’t a flat rate for a building inspection as the costs depend on several factors including:
- The size of the property
- The type of inspection and what it covers
- The property’s location (with metropolitan areas charged more than regional)
But, according to online trades services website Hipages, you’re looking in the region of $800 for a complete inspection of an average-sized home in a metropolitan area.
A small price to pay for peace of mind.
And that’s not their only benefit.
Benefits of a building and pest inspection
In Australia, all buildings must comply with the Building Codes and Standards of Australia. If you buy a home that falls foul of the code, it becomes your responsibility to bring it up to standard – which could mean an expensive repair bill. And getting rid of termites and other pests certainly doesn’t come cheap.
Knowing about faults like these before you sign the contract means you can make an informed decision on whether to continue. This could save you a significant sum of money later down the line.
And if the report pinpoints any issues, you can use it to your advantage at the negotiating table.
Rhiannon Leonard is a lawyer who assists clients with off the plan and SMSF conveyancing.
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