Hi, I’m Kristal Everingham, and I’m a buyer’s agent here at Pumped on Property. In today’s video, I’m going to be talking about all things building and pest inspections. Should you, as a property investor, get a building and pest inspection done on your investment property? The simple answer is yes. Let’s go to the beginning and start at what is a building and pest inspection? We’ll also touch on when you should get one done, and why they’re important.
So what is a building and pest inspection? A building and pest inspection is exactly as it sounds. So it’s a building inspection and a pest inspection carried out by a licensed builder on your investment property or property of choice. So a building and pest inspection will look at the condition of the property and categorise any issues associated with that property into major issues, typical issues or minor issues, from our experience. So the company that we use, uses that terminology, obviously other companies may use other terminology, but still the same thing, identifying the bigger issues with the property, medium issues with the property and minor issues with the property and pointing out what those issues are.
When should you get a building and pest inspection? I guess the simple answer is getting it done before the property is officially yours. So here in Queensland, we’re lucky enough that we actually have a clause in every contract that is a building and pest clause. So basically, it’s a condition in the contract of anywhere from 7 days, 10 days or 14 days, however long that you need, to actually give yourself that time, as part of the contract, to get the inspection done, get the results of that inspection and go from there on whether or not you want to continue with the purchase.
So the building and pest inspection is done in Queensland before what’s called unconditional period. In other states, like New South Wales, you’d want to be getting the building and pest inspection done prior to the property being yours, so that is prior to cooling off. So anytime between having a verbal offer accepted, contract’s being exchanged and the cooling off period, you want to be getting that inspection done, just so that as an investor, you’re in a position that you’ve got the results of that building and pest inspection prior to the property becoming yours and you’ve got the option of making a decision on whether or not you want to take on the risk of that property, if the issue’s are bad, or whether or not you want to continue with the property and the issues may just be minor. So it’s really important to get one done prior to that.
Why is a building and pest inspection so important? Here at Pumped on Property, we do not purchase any property for any clients of ours, as buyers agents, unless we’ve had a building and pest inspection done on that property. Like I said, we’ve got the luxury in Queensland of having it as a condition of a contract, but still, it’s so important to have one done. These reasons are, it highlights any issues associated with that property. So the licensed builder comes through your property, breaks down that property, they’ll look at every single thing including the roof, the gutters, the stairs, the fences, internally, where there’s moisture damage. They will look at absolutely everything associated with the condition of the property and highlight whether or not there are issues there. This is really, really important.
The second reason why you’d want to get a building and pest inspection is as an investor, you want to minimise costs when you buy that property. So by highlighting the issues associated with the property, you can then understand the costs of holding that property in terms of maintenance. You can understand the costs when it comes to settlement, what you may be up for that needs fixing. If the building and pest guys have categorised it as minor, typical and major, you’re then in a position to go, “What do I need to be doing straight away? What am I up for cost wise? What do I need to be putting out of my pocket from day one”. And what are the minor issues that can hold off for a few more years until I do a more major renovation? So understanding the issues associated with the property will help you understand the costs associated with the maintenance and holding costs associated with that property.
Another reason we like to get building and pest inspections done is to use it as a bit of a negotiation tool. So here in Queensland, we’ve got the luxury of using the building and pest inspection to our advantage, because the contract’s already been signed, a condition of the contract is the building and pest, we can then negotiate on the contract using the building and pest clause. So we could be asking the seller to fix some of the issues that have been identified by the licensed builder in that inspection. Your solicitor can help you try and negotiate a price reduction off that particular property based on some of the issues that were identified. So not only does it help you understand what’s wrong with the property, how much those issues are going to cost down the track, it can help you negotiate a little bit off the price, if you use it to your advantage and in the right way and use your solicitor to your advantage.
So just going back on what we’ve talked about today. Should you get a building and pest inspection on your property? The answer is yes. You should be getting that done prior to the property being yours and being officially handed over whether that’s your colling off period or your unconditional period. Why is it important? Because you as an investor really need to understand the costs involved with holding that property, the issues associated with that property, the breakdown of those issues into major, typical or minor and whether or not you can use those issues to your advantage to negotiate on the contract at hand.
Thank you so much for listening. I’m Kristal Everingham from Pumped on Property, and I’ll see you next time.