It is important in buying or selling a property that you go through a building and pest inspection before you make any further negotiations. There are several reasons – the primary is to assess the condition of the property totally, both internal and external. If you’re a seller – it will help you bring up a relevant and reasonable offer if you know the current condition of the property. This can also guide you in deciding whether to hire a pest control company for clearing all the pests even before the building is put up on the market. On the other hand, if you’re a buyer – of course, once you’re aware of the property’s condition – it will give you the advantage to bargain for the price.
Pest and Building Inspection – why is it IMPORTANT?
Get the Property’s Existing Condition.
Often, sellers try to hide both major and minor flaws so that the building or house is attractive and presentable in the eyes of the buyers. You will have a better sense on the state of the property when you engage in a building and pest inspection. You will not be able to know this by yourself. The fact is that only the property’s exterior is seen if you’re just doing an ocular inspection unless you were trained to determine defects at once. Some examples of these flaws include walls or ceilings with problems, roof leaks, water damages, pest infestations, and more. If you decide that a building and pest inspection is necessary, what you are after is a report on the current condition of the property that will include any significant defects in the building or problems like the examples already mentioned. What’s the present condition of the house – is it okay or not? Everything concealed will be revealed in the report. Simply put, as a buyer – if you know the existing condition of the property, then you can always bargain for it, or request that all the defects be restored before your actual move.
That’s SAVINGS for you!
Perhaps, one of the key reasons why people don’t want a building and pest inspection is because it is considered an additional expense. Conversely, if you spend on building and pest inspection, it is going to save you money. If you know the present condition of the building, it will make you ready for your next step. People who normally pay for the building and pest inspections follow them up with the required pest controls and repairs to upgrade the building. Recognising the defects initially will provide you an advantage, suggesting that you can do something about them before they get too difficult and expensive to fix. Because if you postpone it, the property may further deteriorate — meaning, the repairs will be costlier to reverse the damage.
Resale Value is increased.
Just for the record, a property’s worth is enormously affected by its existing condition. A run-down home will be priced significantly less than a well-kept and maintained one. Also, the resale price of a house or building can be higher if a building and pest inspection is done. Fixing the house and doing the necessary repairs will help preserve the property’s structure, thus, increasing its value. Otherwise, if you do not do building and pest inspection, you won’t be able to carry out the appropriate repairs on the house and the outcome may be to your disadvantage – the house value will depreciate.
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BUILDING and PEST INSPECTION’s FAQs
Is building & pest inspection considered tax-deductible?
The answer is NO, not as you expected.
If you buy an income-generating investment property, the related expenses with the purchase are treated differently for later repairs, ongoing maintenance, and management costs.
Most of the upfront costs are called ‘capital costs,’ including, conveyancing costs, building plus pest inspections, and stamp duty. You cannot claim these costs as tax deductions in the year they were incurred. But what happens is that they just get included in your cost base and reduce your Capital Gain if and when you sell the property.
Why do I need both at the same time: a Building and a Pest Inspection?
You both need a combined Building and Pest Inspection because it will provide you a complete evaluation of the current state of the property. While building inspection’s scope is only on structural defects and hazards, what will determine the presence of any termite or pest infestations around and inside the building will be a pest inspection itself. For example, if you go to Queensland — it is recommended to guarantee the good condition of the property before purchase.
What is a ‘Pre-Purchase Building or Pest Inspection’ all about?
Well, you should carry out a building and pest inspection first and foremost before a property purchase. A professional building and pest inspector (with a licence) should be asked to do the job. He should present a comprehensive and detailed report of all the documentation regarding the property’s condition, both from the inside as well as the outside. This property inspection report should cover info and evidence about the defects or problems of the property uncovered in the said inspection. Among these problems include a leaking or faulty roof; warped ceilings, walls with snaps, the existence of mould, and more. The inspection report on building and pest must be completed before finalising a contract with the seller. Your knowledge about the property’s current condition will help you plan and decide on your next step: go ahead with the purchase, haggle for the cost of the property, or outright cancel the proposal. Most buyers withdraw from the deal once they discover that the house or building has major and serious defects that will entail a significant amount of money to fix.
Can I do property self-checking before an authorized inspection is made?
YES, of course! You can always have your property self-checked along with the report you intend to get from your inspector. In this way, you will be able to know upfront the existing condition of the property and discover the problems you may want to discuss later with your building and pest inspector.
Listed below are the most general issues which you can uncover through self-checking – examine each one, ticking it off on the list:
- walls on the verge of collapse, and ceilings that are sagging;
- all walks, ceilings, and panels or woodworks for mildew and mould if present (Check for paint jobs done to cover up the mould.);
- gutters, drainpipes, and roof;
- exterior walls for any cracks and defects;
- all doors and windows opening and closing easily;
- underneath carpets (Are the floors damp or soiled?);
- hot water system – find out the age and size;
- turn on the valves/faucets to check how long before the hot water flows;
- flush the toilets to observe the running tanks if okay;
- shake plumbing below the sink for strength (Are their rust and other pipe defects?);
- fuse compartment to evaluate the age of circuitry;
- request information about the building’s efficiency rating for energy from the seller.
Why you should proceed to have a Building and Pest Inspection
Before you buy a home or building, will the building and pest inspection be necessary? YES – it will be a safeguard to some risks. Just imagine how distressing it would be to discover the house which you purchased at a very high price is flawed or substandard, as well as pest-infested. So disappointing, ‘right? But when you’re presented with an extensive building and pest inspection report, you can easily categorize the issues and resolve the concerns and the inspection data will arm you with the necessary information to bargain for a reduced price.
How to find a competent Building and Pest Inspector
It’s a MUST that the building and pest inspector you hire is qualified for this job. For instance, again in Queensland – they require these inspectors with an updated Builder’s Licence, meaning capable with Building Inspection as well as Pest Management credentials as attested by the licence. These are the well-trained professionals who see beyond any cosmetic concealments of most sellers that you could have otherwise missed out on. An inspector who is a certified professional will make sure that the report is prepared in accordance with Australian Standards.
Check out “Positive Cash Flow vs. Negative Gearing“
What will the Building Inspector do and check?
Your building inspector should check each of the following:
- Property’s Exteriors
- Roof Exterior
- Roof Spaces and Composition
- Fencing
- Walls
- Retaining Walls
- Paths
- Garage
- Driveways
- Garden Shed
- Property’s Interiors
- Stairs
- Bathroom and Toilet
- Under Floor Space
- Laundry
- Surface Water Drainage (ex. rains)
What information is included on a Standard Building Inspection Report?
The report should include the following information:
- Name and Property address;
- Purpose and date when the inspection was carried out
- Scope of the inspection;
- A detailed listing of the property’s general condition, stating all the defects, whether these are important or trivial/negligible;
- All problems which require repairs;
- Items and rooms/places which were not inspected – with reasons for leaving them out plus a recommendation for investigation (if necessary)
- Recommendation for a re-inspection if still required.
Is it OK that the purchase of a property be withdrawn? When can you do it?
You’re fortunate if you’ve found a property with minimal problems to nil. But the reality is that you may be looking at a property that’s beset with notable problems – it’s okay as you can always call off the agreement or deal. As you know, there could be flaws in the building which can be harmful or dangerous to your health more than your pocket. Some examples are poor electrical wirings, the existence of asbestos and mould, and rusting that can somehow affect the building’s structural integrity. You should be able to judge for yourself based on the results of the building and pest inspection report, as neither your building inspector nor your lawyer will act on your behalf. The final decision solely depends on you.
What happens if I don’t buy the property?
Once you’ve paid for a building and pest inspection for a potential purchase that didn’t push through, then there is no base cost to begin with, implying that this expense is NOT claimable.
How much do Building and Pest Inspections cost?
It depends on the company you’ve selected to hire. Generally, for regular inspections – you will pay a $200 fee, however, for the more expensive and thorough inspections – it’s about $500. If you are looking at getting all the services for building, pest, and swimming pool reports (all 3 of them at the same time) – multiply the amount by three.
Key Takeaways:
Know that a building and pest inspection is not to be considered an unnecessary expense. Just consider it like any insurance cover that will protect your financial resources from major expenditures associated with significant repairs down the road. A cost-saver in the future. If you’re buying a property- as your own home or as an investment, you are shelling out a lot of money. Do not go through the pitfalls of investing in low-quality or substandard property for the mere reason that you have failed to make a fair assessment of its condition beforehand. A building and pest inspection is highly recommended so you’ll not have any regrets later on. We’ve provided you all the tips here so just go for it.
