Terminating house sale under a pest and building condition

In Queensland, it is standard for contracts of sale of a home to include a pest and building condition via an inspection. This condition allows a Buyer to engage a licensed pest and building inspector to carry out an inspection and assess the condition of a property.

Under an REIQ (Real Estate Institue of QLD) contract, the Buyer has until 5.00 PM on the Pest and Building Inspection date completed to advise the Seller whether they are satisfied with the report or not. If no notice is provided by the deadline, the Seller has a right to terminate the contract and the potential sale of the property.

If you receive your building and pest inspection report and have concerns about the property assessment, we recommend you discuss this with us as soon as possible.

You may then decide to try and negotiate with the Seller to arrange for the Seller to fix any items listed in the report or reduce the purchase price. Buyers should be aware that Sellers are not obliged to agree to fix any issues or reduce the purchase price. In addition, not every issue raised in the pest and building report will automatically give rise to a right of termination of the sale.

In order to terminate the contract under a standard REIQ pest and building condition, the Buyer must act reasonably with the report’s findings.

What is reasonable?

What is reasonable includes items such as:

• The age of the property.
• The amount and severity of the issues found in the report.
• If the issues were obvious at the time of inspection and when the price was negotiated, the first inspection of the home.

Safeguarding under the inspection

There are a number of steps you can take to safeguard the inspection process and purchase of the property, these include:

• Before signing the contract, you make sure the real estate agent has not limited the scope of the pest and building condition to ‘structural issues only’ or something similar.
• You personally arrange for the inspection to be carried out well ahead of time to allow time for the inspector to prepare the report and negotiations to take place following the findings.
• You seek an extension of the pest and building condition if you need additional time to arrange for further inspections or quotations for repairs as a second opinion.
• You speak to your inspector directly (or attend the inspection) so they can give you as much information as possible about the property.

It’s important to be realistic about a property as well. It is reasonable to expect that there will be some minor repair or maintenance matters to attend to on any established home no matter how well it presents visually.

Arrange a building and pest inspection

If you are in the process of buying a home, you can arrange one of our trained inspectors to undertake the inspection for you and provide a detailed written report to help you negotiate the sale price. Contact us today.

Certified Home inspections offer one of the most thorough inspections on the market.

Call us on 0732008585