YOUR mortgage finance is all ready, you’ve done your market research and you’ve been looking around at properties for months.
Now you’ve finally found a house or apartment you’d really like to buy and you’re ready to make an offer or bid at the auction.
But there’s one final hurdle: the pre-purchase inspection reports.
Are they really necessary, or are they an extra expense at a time when you’re feeling really squeezed for cash that you could well do without?
There are a number of different types of reports you can have done on a property before you attempt to buy it.
A building inspection will look into the state of the home you are thinking of purchasing, examining the roof, the floors, the walls for any damage, deterioration, cracking or rising damp, the plumbing and the electrical wiring.
A pest inspection will look for any evidence of an infestation, most usually termites or termite damage.
A strata inspection, if you’re buying an apartment or strata townhouse, will check on the finances and the minutes of the owner’s corporation running the building, to warn you of any problems in the building, or the likelihood of issues in future.
There are other inspections that might be necessary, depending on the age, and type, of property, including an asbestos inspection.
Why do it?
In his 34 years of inspecting buildings, Dan Drexler has witnessed some heartbreaking sights.
One of the hardest was a woman who had a building inspection done after she’d bought her Sydney house to check on any repairs that might be necessary.
“It was a disaster for her – the whole roof was eaten by termites and would cost tens of thousands of dollars to fix. She said she probably would never have bought the house if she had known beforehand.”
Such tales are, sadly, all too common. If you don’t have inspections done before you buy, you could be up for a whole world of unexpected expenses.
“Knowledge is power,” says another industry veteran, Jerry Tyrrell, founder of Tyrrells Property Inspections.
“You might think you’ve got a bargain, but then you end up facing $300,000 to $400,000 in repairs, and suddenly you realise you’ve bought a lemon.”
What to look for
The best report should list any defects clearly and assess the likely cost of repairs. It should be thorough and go through every aspect of the property you’re thinking of buying.
It can be hard for a potential purchaser to understand the magnitude of problems so it’s important that the report gives a strong indication.
“Most homes will have some problems, but those problems can be quite minor or major,” says Rhys Rogers, the CEO and founder of Before You Bid. “Issues like rising damp or termites can be very costly to repair so you really need to know what you’re up for before you buy.”
Avoid companies, or inspectors, who issue reports filled with incomprehensible jargon, have pages of waffle and are mostly disclaimers and photographs, advises Tyrrell.
“We’ve seen reports that are padded out like that and never drill down into issues,” he says. “You can receive a wad of paper and no one quite knows what’s in there. You need to know what’s wrong and what it will take to fix.
What’s the cost?
Costs can vary wildly, but when assessing which company you’ll go for, you have to consider that sometimes you get what you pay for.
An extremely cheap report might end up not worth the paper it’s written on – and cost you a huge amount in the long term.
Generally building inspections tend to be about $450, pest inspections $400 or the both together $550.
Strata inspections alone could be around $400.