In my experience, few contracts fall over on finance conditions, but there are frequently issues that need to be negotiated between buyer and seller that relate to matters raised in the building inspection. Many buyers forget that they are buying a second-hand home that has been lived in and will have maintenance issues, even if small, from the time of moving in. As a result, inspection reports are often received with unrealistic expectations about what should be fixed and what should be accepted. So, what are these issues, and how are they best addressed by property vendors before they jeopardise a sale contract?
The Inspector’s Role
Many of the problems with inspectors stem from a misunderstanding of the role of the inspector and the scope of his/her report. The building inspector is not an expert in specifics about structures, electrical, plumbing or pest control and is not able to offer expert opinion. He/she is only able to provide general comments upon the condition of the building, within a limited time of inspection (about 1 hour) and recommend where issues are raised that an expert opinion be sought.
The Inspector’s Report
It is important to understand that the majority of the building inspector’s report uses wording approved by their solicitors or insurance company, because in the past buyers have sued building inspectors for damages when their report has failed to identify a problem or has failed to be explicit enough about its impact. As a result, building reports will often:
- Exclude anything in areas that the inspector cannot access (ie roof spaces, under carpet, behind furniture). Inspectors don’t comment on what they cannot see.
- Exclude testing of appliances, air conditioner, water tank, hot water system, pumps, swimming pool.
- Recommend specialist inspections by experts in areas that have been inspected – for example, if cracks are found the report will often include a recommendation that a structural engineer be engaged to check the cracking. Other specialist inspections might include – roof plumber to check roof, air conditioning technician to check that, electrician to check on electrical appliances and safety
- Include disclaimers on report results, rendering them generalised interpretations rather than an expert finding.
What are matters that are often noted in building inspections?
- Water and moisture – if there are areas outside that rainwater accumulates or are subject to moisture from leaks, inspectors will note these as they are potentially attractants to termites. Home owners should ensure there are no areas around the house that have excessive moisture or water retention before selling.
- Cornice Cracks – quite often there will be small cracks in the corners of cornice work. They are not usually structural problems, but all houses move and this is where cracks will often first appear. Solution: Pollyfilla and paint.
- Other Cracks – repair any cracks anywhere on the interior and exterior. If you can’t do a decent job, pay a handyman or painter. It will be worth it.
- Cracked tiles – replace any cracked tiles if possible as these are bound to be commented on by the inspector. Cracked tiles can be only cosmetic but they are a significant negative for buyers.
- Drummy tiles – inspectors love to run their tap tool over tiles and find some that sound a little “drummy”. This doesn’t necessary mean there is a problem, but it could suggest future cracking or moisture ingress.
- Sliding doors – often sliding doors are sticky or do not work properly. Before putting the house on the market have all sliding doors fixed so they are sliding well. Fix any windows that are not opening properly.
- Insect screens broken – pets will often cause tears in insect screens and doors. It is a minor issue, but is something buyers will notice. These should be fixed before sale.
- Downpipes and drains – leaking or cracked plastic downpipes and external drains. These are not difficult to replace or fix, and if you can’t do it, a handyman can.
- Roof – cracked tiles, missing roof capping cement, gutters that have signs of possible leaks. It is almost impossible for inspectors to be certain about leaking roofs, unless there are very obvious signs such as water damaged ceilings.
- Vegetation too close to the house – a common risk that can hide termites gaining access to the house. Ensure that you have at least 15cm clearance from the house to enable inspection of walls for signs of termite entry, regardless of any termite system you have installed.
- Signs of rust – inspectors will usually note even minor rust, for example on light fittings, metal hinges and fixtures.
- Loose wiring – any loose wiring should be fixed and enclosed by a licensed electrician as it looks terrible and can be a significant safety issue.
- Moisture in bathrooms – moisture behind walls and under tiles in bathrooms can be signs of significant problems and cause of contracts crashing under negotiation. Any evidence of moisture problems in bathrooms should be fixed before the sale
- Air conditioner water outlet not connected to drain – sometimes installers of air conditioners don’t bother to duct the water safety outlet to a drain. This is a simple fix that should be done before the property goes to market.
- Loose toilet seats – if toilet seats are so old that they are loose, then I would suggest they should be replaced before sale.
- Loose fences – if fences are loose when pulled by hand this is a sign of potentially wood rot to the fence posts.
- Uneven ceilings – using a torch, the inspector will check the ceilings in each room and if they are uneven, a comment will be made.
- Evidence of termites or of wood rot – it should be self-evident that evidence of termites will be a significant deterrent to buyers. Any evidence of termites should be repaired before sale. Any wood rot should be removed and replaced. I recommend that all vendors have a pest inspection (and pest treatment) before selling, just in case. Ensure the house has been sprayed for cockroaches and spiders. It can be the best preventive action you can take.
Ideally, I would recommend that vendors have a building inspection done before listing the property on the market. You can be sure that some issues will be found that could impact on a sale contract, and it is better to address these before the property goes to market rather than when a buyer gives an unsatisfactory verdict through their solicitor.