Far above all else, failing to carry out due diligence is the number one reason that home buyers run into issues. When you purchase a home you are making a huge investment. For many home buyers that means living in the same property for the rest of their lives.
When you buy a property that is riddled with defects, it is usually you who ends up footing the bill for repairs. Once the purchase agreement is signed it is too late to start negotiating on price. Pre-purchase inspections help create a level playing field for home buyers, allowing you to make more informed decisions and putting you in the best position to negotiate the asking price.
Homes in Victoria are often sold at auction. If you think you’ve found your dream home and it’s going to auction, a Pre-Auction Inspection may assist with negotiating an offer price and it being accepted prior to the auction date. This can be an incentive to vendors for reducing selling costs or if they’re seeking a quick sale. Even better, if the property is passed-in at auction, our report can help you negotiate a great price afterwards.
Remember, any Building or Timber Pest damage that you discover after your purchase will not be covered by your insurance company. Insurance companies do not pay for any damage that existed before you bought the property! Our Pre-Auction Building and Pest Inspection reports will give you peace of mind before the auction.
Personal inspections serve a useful purpose as not all home buyers are working from the same checklist. This is your opportunity to view properties for sale and make sure that they meet your personal needs.
During a viewing you can check for obvious defects by testing doors, windows, brick work, running water, water pressure, etc. It also gives you a chance to evaluate the orientation of the property, where it is located, and noise levels in the area.
Carrying out personal inspections will help you significantly narrow your search, leaving you with only those properties that show the greatest potential. However, it is not enough to end your due diligence with personal inspections. You might see problems but may not know the cause and what repairs are needed.
Professional Pre-Purchase Inspection
While most home-buyers will have a fair idea what to look for in a property, many buyers fall into the trap of missing the cover up. There are plenty of ways and means of covering up damage with cosmetic work. Only an experienced eye will see through the facade to the defects lying below the surface.
There is a good reason that Houspect uses only qualified builders as our building inspectors. A qualified builder has fundamental knowledge of a building’s structural requirements and can recognize the tell-tale signs of cosmetic patch jobs. A pre-purchase inspection could potentially save you a great amount of time and money. Home buyers expect to pay more for a property that is in demand. If that property has serious defects, you will end up paying even more for repairs.
Every property will have some kind of defect. There is not an architect or builder who can claim to have designed or constructed the perfect property. At the very least you can use any defects found in a pre-purchase inspection to help you negotiate on price.
If there are significant defects to the property and you cannot afford the renovation costs, you will lose out when it comes time to sell the property. Home buyers are increasingly seeing the benefits of pre-purchase inspections, so buyers in this situation will likely have the upper hand in price negotiations.
As of 1 July, 2017, changes to the First Home Owner Grant and Stamp Duty took effect. That means that homes up to the value of $600,000 dollars are exempt from the new home buyers stamp duty. If the value of the home is between $600,001 and $750,000, the stamp duty is calculated on a sliding scale. Additionally, the first home owner grant has increased to from $10,000 to $20,000 for homes with a value up to $750,000, although with Melbourne’s median house price in excess of $800,000, so this may not be applicable for many buyers – all the more important to be sure about what you are actually buying.
A pre-purchase inspection can realistically help you reduce the asking price on a property so that you can benefit from changes to the Stamp Duty levees and First Home Owner Grant for new buyers.