When purchasing a house or investment property, you may choose to have a competent building and pest inspection performed. These are highly recommended because they can not only keep you from purchasing problematic real estate but can also save you money. If you have an excellent conveyancer, they may be able to use the findings of your building and pest report to negotiate significant savings. How? Because a building report can reveal flaws in the property that may provide leverage for buyers to renegotiate the asking price, potentially saving them thousands of dollars.
Benefits of Renegotiating After a Building Inspection
Renegotiating the price of a property after a building inspection can have numerous benefits for buyers. One of the primary advantages is that it allows buyers to avoid costly surprises down the line. A building inspection can reveal hidden defects or issues with the property, which can be used as leverage to negotiate a lower price. This can help buyers save thousands of dollars in potential repairs and ensure that they are making a smart investment.
Additionally, renegotiating after a building inspection can also provide buyers with a sense of security and peace of mind. By identifying potential issues with the property, buyers can ensure that they are making an informed decision and avoid any costly surprises in the future.
Understanding the Building Inspection Report
A building inspection report is a detailed document that outlines the findings of a building inspection. The report typically includes information about the property’s condition, including any defects or issues that were identified during the inspection. The report may also include recommendations for repairs or maintenance.
To understand the building inspection report, buyers should carefully review the document and ask questions if they are unsure about any of the findings. It’s also essential to work with a qualified building inspector who can provide a comprehensive and accurate report.
Can You Negotiate After A Building And Pest Inspection?
A Building and Pest Inspection report can provide much more than simple peace of mind. An inspection can also be your route to big savings by negotiating house price. The harsh reality of real estate is that homes frequently acquire issues as they age. The difficulty for first-time buyers is that not all flaws are obvious. Mould can be buried behind walls, cracks beneath the paint, structural difficulties hidden inside cupboards, and so forth. Several less significant issues may be discovered on your building and pest report, which may present an opportunity for your conveyancer to bargain on your behalf.
Some of the issues a report may uncover include:
Identifying Termites
The word “termites” probably makes you cringe. However, these hungry, tiny animals could be your ticket to a profitable investment! If you’re looking at houses that need substantial rehabilitation or considering a knockdown and rebuild, the presence of termites could be extremely beneficial.
A comprehensive property inspection can reveal structural issues and hidden damages, enabling you to renegotiate the purchase price based on the findings. Repairing termite damage can be expensive if you want to keep and preserve the old home, but if you want to gut the place, that extra cost becomes unimportant. Because the vendor is unaware of your plans for the property, when you present them with the pest inspection report indicating the home has uninvited guests, they are more likely to pay attention to your negotiating techniques.
Use the existence of termites to play hardball, there may be a lot of room for a deal here.
Look Out For Termites
No one wants to find termites on their property, especially one they are thinking about purchasing. However, if termites are found during a building and pest inspection, it could mean you have more power to negotiate a lower property price by highlighting the issues discovered.
This is particularly true if you are looking for project investment. If you are considering a rebuild or complete renovation, then termites will probably be the least of your problems.
Yes, it can be expensive to treat termite damage if you are looking to restore an old home. However, if you are already planning on gutting the place, this cost becomes less important and more of a bargaining tool.
The person you are purchasing from is likely unaware of any of your plans so, when you provide them with the news that the home has termites present, they are going more likely to make a deal.
Water Damage And Damp
Again, water damage and dampness in a property can give you the power to find the ultimate deal for your new property. Identifying issues with the electrical system, such as outdated or poorly updated components, can also be crucial during an inspection. This is one of the most commonly picked up problems with a building and pest inspection and it gives you the power to negotiate based on the cost of repair.
Gather several quotes and identify the cause of the issue, then show your findings to the seller.
Structural Issues
A home is supposed to be a safe environment; if there is an issue with the structural integrity of the property you are buying, you may be able to cut thousands from the asking price by highlighting its impact on the property value.
Damaged roofs, cracked walls, and illegal alterations can cost you a small fortune to repair. If there have been any illegal alterations, you could end up having to knock down structures or undertake major work to correct the completed work. If any of these are identified during an inspection, you most definitely have the power to make strong negotiations.
If you negotiate based on the costs of the repairs, you will have a strong case and have the money to complete the work you need to.
Asbestos
It’s estimated that one-third of Australian homes built before 1987 have some form of asbestos, it can be found in anything from the ceiling to the bathroom tiles. If you find this during a building inspection, you should look at the law in your state here. www.asbestossafety.gov.au.
Involving a knowledgeable real estate agent can facilitate discussions, provide guidance on inspection reports, and enhance the overall negotiation process. Then you should find the correct information and the cost of removing the asbestos. Show your findings to the seller and negotiate based on the costs.
Preparing for Renegotiation
Before renegotiating the price of a property, buyers should prepare by gathering all relevant information and documentation. This may include:
- The building inspection report
- Quotes for repairs or maintenance
- Evidence of comparable sales in the area
- A clear understanding of the property’s market value
Buyers should also be prepared to negotiate and be flexible. This may involve being open to different options, such as a repair credit or a price reduction.
Handling Seller Objections
When handling seller objections, buyers should remain calm and professional. It’s essential to listen to the seller’s concerns and address them in a clear and concise manner.
Buyers should also be prepared to provide evidence to support their request for repairs or price concessions. This may involve providing a copy of the building inspection report or quotes from licensed contractors.
By being prepared and professional, buyers can effectively handle seller objections and negotiate a fair price for the property.
Tips to help you negotiate
If you’ve come across a property with some perks and pitfalls, here are some strategies you can put in place to drive down the purchase price and secure price reductions using inspection findings.
- Obtain quotes to rectify the issue at hand. You can do this by asking the inspector how much it might cost to repair or complete upgrades or you can go as far as to obtain quotes from trade specialists.
If you are buying a property, it is important to make sure you conduct a building and pest inspection. Victor Legal can help. Get in touch today.
