Building & Pest Inspections When Buying A House

Imagine buying a home, settling in and making it your own, only to realise three months down the road that the foundation was crumbling and there was an existing termite infestation the whole time. That’s one quick way to turn your dream home into a nightmare. 

A building and pest inspection for your home is a simple yet effective way to safeguard your most valuable and expensive investment. Without this inspection, you could end up buying a dodgy home.

In this article, we take you through the basics of building and pest inspection, from what it is to what you should do afterwards.  

What is a building and pest inspection? 

A building and pest inspection is used to identify underlying issues, structural or otherwise, with the property you may have missed in your initial walkthrough. This helps you as a buyer because it tells you everything you need to know about the condition of the property. No nasty surprises once you’ve moved in. 

The inspection can be divided into two parts: scanning the building and examining for pests. The building inspection determines the physical condition of the house which includes safety hazards and defects. Meanwhile, the pest inspection examines the house for any evidence of active termites or other pest infestations. 

How much does a building and pest inspection cost? 

The cost for a building and pest inspection depends on your location, the size of the property, and the type of inspection package you choose. On average, a building inspection can cost around $300 to $1,200. Smaller homes tend to be cheaper costing around $200 to $300 while bigger homes or homes in metropolitan areas can cost upwards of $800. 

Should you get a building and pest inspection when buying a house? 

It’s recommended but not legally required. A building and pest inspection when purchasing a property is important as it identifies the following:  

• Structural issues with the building. 

• Any evidence of termite infestations/other pest infestations e.g. rodents, cockroaches. 

• Holes or cracks in the roof or walls that are not visible to the naked eye. 

• Any mould, rust, stains, dampness, leaks, corrosion, rotting timber, or any other kind of damage to the property. 

• Doors, windows, or any other feature of the home not working correctly. 

Not doing a building and pest inspection is like buying a car without getting an RACQ check or mechanical vehicle inspection. You won’t know if there’s anything wrong with it until one day you’re stuck on the highway and the car won’t turn back on. 

Now, you might be wondering if the advice still stands on newly built homes. The answer to that is yes. Even recently constructed homes can have structural or pest issues. It’s best to err on the side of caution when it comes to these things.

What is covered by a building and pest inspection? 

A building and pest inspection will typically cover the following areas: 

• Interiors (e.g., walls, floor, ceiling, windows, doors, bathrooms, laundry area, stairs) 

• Exteriors (e.g., roof, foundation, garage, external finishes, gutters, down pipes, eaves, decking, fencing, retaining walls, paths, driveways, and surface drainage) 

• Attics and basements 

The building and pest inspection report will cover any faults, issues, and defects of the property. It will detail the damages to the property's structure or if there is any evidence of pests. 

What isn’t covered by a building and pest inspection? 

A good rule of thumb is that if it’s not part of the property's structure, then it likely won’t be part of a building and pest inspection. Building and pest inspections generally don’t include: 

• Electrical wirings, drainage systems, plumbing, and paint 

• Home appliances (e.g., refrigerator, television, oven) 

• Home accessories (e.g., sprinkler system, smoke detectors, security system) 

If your property has a pool or fireplace, you may need a special-purpose inspection for it. A typical building and pest inspection also won’t check whether a building is up to code or abiding by zoning rules. 

The report won’t have recommendations or possible costs of repairs either. Typically, inspectors only include defects that need substantial repairs or urgent attention. 

When should a building and pest inspection be carried out? 

Usually, a building inspection is performed before finalising a property purchase. A clean building and pest inspection report is often a condition in a purchase contract.  

You can have the inspection before or after the offer. However, it’s more common to have a building and pest inspection after an offer than after one.

What does ‘subject to building and pest inspection’ mean? 

When you see the phrase ‘subject to building and pest inspection’ in a purchase contract, that means the sale of the home depends on the results of the building and pest inspection. The seller must meet the conditions of the contract until it is deemed satisfactory. 

What happens if a fault is found in a building inspection? 

Unfortunately, not all inspections will return with a green tick of approval. If major issues are identified, it can provide homebuyers with more negotiating power. A buyer could go back to the agent or solicitor and request the owner fix the issue at their own cost with proof they have done so. Homebuyers can also renegotiate the purchase price to account for the repairs or withdraw from the sale entirely.  

What to do when withdrawing an offer after a building inspection? 

If your purchase contract includes a condition pending the results of the building and pest inspection, you can choose to withdraw your offer if the inspection report reveals unsatisfactory results. 

Before rescinding your offer, review the terms and conditions of your contract carefully. Ensure there are clauses in place that allow withdrawal of the offer based on the results of the report. You may lose the initial deposit or incur fees if you decide to withdraw your offer but this isn’t always the case. 

Also, make sure that the reasons for taking back the offer are valid. Finding major structural problems or pest infestation can justify rescinding the offer while minor issues like chipped paint or other cosmetic defects may not. 

If you decide to withdraw the offer, talk to your real estate agent or solicitor immediately so they can get in touch with the seller’s representatives. State the reasons why you won’t move forward with the sale and provide the full inspection report. Doing so will help avoid miscommunication and future disputes. 

What are the benefits of having a building and pest inspection? 

Identifying problems early on can save homebuyers a considerable amount of money in repair costs down the line. It also provides an opportunity to renegotiate the purchase price or withdraw from the sale if the issues are severe enough. 

A building and pest inspection can provide peace of mind. Knowing that the property has been thoroughly inspected by qualified professionals can assure that the investment is a sound one. Even if no major issues are identified, having a report that confirms the property's condition can provide homebuyers with confidence in their decision to sign on the dotted line. 

To chat about home loans, your borrowing power, or to get started on your home ownership journey, talk to one of our friendly lending specialists today. 

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