Buying property
Do you need a pest and building inspection?
Nobody will make you get one. But a few hundred dollars spent before you exchange can save you from a repair bill that lands after settlement, when it is entirely yours.
Clients ask us about this on almost every purchase. A pest and building inspection is not compulsory in NSW. No law requires it, no lender insists on it for an established home, and the agent will not stop the sale if you skip it. It is still the cheapest insurance you will ever buy on a property purchase, and the window to use it is shorter than most buyers expect.
At a glance
- A pest and building inspection is optional in NSW, but the cost is small against the purchase price and the report is yours to act on.
- The inspector is a separate expert you pay directly. Your conveyancer does not attend the property and does not review the report.
- Book it the day your offer is accepted. The 5 business day cooling-off period is your window to read it and decide.
- At auction there is no cooling-off period, so the inspection has to happen before you bid.
- Reports are visual and non invasive. They record what can be seen on the day, not what is hidden inside a wall.
The short answer
Yes, get one. For several hundred dollars on a purchase worth several hundred thousand, you are buying information you cannot get any other way. You are also buying the right to change your mind with a reason, rather than a feeling.
You are free to choose any inspector you want. If you are confident doing the walk through yourself, you are allowed to do that too. Our free home inspection checklist for buyers covers what to test in each room. What you are not allowed to do is undo the purchase after settlement because something turned up that a report would have found.
In plain English
Once contracts are exchanged and the cooling-off period has passed, the property is yours in substance. You buy it in the condition it is in on the day. There is no warranty from the seller that the roof is sound or that the deck is free of termites.
Building inspection and pest inspection: two different things
Most local inspectors sell them together and produce a combined report, but they look for different problems.
A building inspection is a visual assessment of the whole property, inside and out. It records structural faults, movement in walls and floors, roof and gutter condition, dampness and drainage, and the minor defects, maintenance items and safety hazards that add up. It usually covers additions too, such as decks, retaining walls, sheds and carports.
A pest inspection looks for timber pests, termites above all. A good report separates three things that buyers often blur together: live termite activity, past damage, and conditions that make a future infestation likely, such as timber stacked against the house or garden beds built up over the weep holes.
The Hunter and Lake Macquarie have plenty of older timber framed homes and plenty of termite pressure. Do not treat the pest half as the optional half.
Your conveyancer does not review the report
This one surprises people, so it is worth being blunt about it. The inspector is engaged and paid by you, separately from your legal fees. We have not walked through the house and we are not qualified to interpret roof framing or moisture readings, so we do not review the report and we do not advise you on whether the defects are acceptable.
What we do is act on your decision. If the report changes what you want to pay, or whether you want to proceed at all, tell us and we will handle the contract side: negotiating a price reduction with the agent and the seller’s conveyancer, adding a special condition, or rescinding during the cooling-off period.
Book the inspection the day your offer is accepted, not the day after you exchange.
When to get it done
Timing is where this goes wrong far more often than quality of inspection. There are three sensible points, and one of them is not available at auction.
Before you exchange, if the seller will wait
The cleanest option. You know the condition before you are committed to anything and before any deposit is at risk. The catch is that sellers and agents rarely hold a property for a week while a buyer arranges an inspection, and in a competitive market waiting can cost you the house.
During the cooling-off period, which is the usual way
Most buyers exchange with a 5 business day cooling-off period and use it to get the inspection done and the report read. It works, but it is tight. Book before you exchange, not after, because inspectors in the Hunter are often several days out.
If the report is bad enough that you walk away, you rescind during the cooling-off period and forfeit 0.25% of the purchase price. On a $800,000 purchase that is $2,000. Expensive, and far cheaper than a restumping job.
Before auction day, because there is no cooling-off period
Buy at auction and you exchange on the fall of the hammer with no cooling-off period and no way out. Every inspection you want has to be done and read before you raise your hand. Budget for the possibility of paying for reports on a property you do not win. See our guide to buying property at auction in NSW.
What it costs and who pays
Expect a combined pest and building report to run to several hundred dollars for a standard house, with the price moving depending on the size of the property, its age, and how far the inspector has to travel. You pay the inspector directly. It is not part of your conveyancing fee and it is not a disbursement we collect.
Ask what the quote includes before you book. Some inspectors charge extra for a separate strata report, a thermal camera, a pool area, or a second dwelling on the block.
What to do when the report finds something
It will find something. Every report on an established home lists defects, and a long list is not automatically a reason to walk. Read the summary, look at what the inspector has flagged as major or urgent, and ignore the noise about scuffed skirting boards.
From there you have four realistic options:
- Proceed anyway. The defects are minor or expected for the age of the house and you have priced them in.
- Negotiate the price. Get a quote for the repair and put it to the agent. This is far more persuasive with a written quote attached than with a gut feel number.
- Ask for the work to be done before settlement. Possible, but it needs a special condition in the contract, and the standard of work becomes an argument later. Usually a price reduction is cleaner.
- Rescind during the cooling-off period. You forfeit 0.25% of the price and walk. That is what the cooling-off period is for.
Whichever way you go, talk to us before you talk to the agent. The contract usually gives us more room to work with than a phone call does.
Every report finds something. The question is not whether there are defects, it is whether you knew about them before you were committed.
Buying a unit or townhouse?
A building inspection of a strata lot only covers the inside of your lot and what the inspector can see of the common property. It will not tell you that the owners corporation has a failing waterproofing membrane, a special levy coming, or no money in the capital works fund. For that you need a strata report, and on a strata purchase the strata report is the more important of the two.
Four mistakes we see
Relying on the seller’s report. If the agent hands you an inspection report, someone else commissioned it, for their purposes, at a date that may not be recent. Read it, then get your own.
Accepting a verbal summary. A phone call saying it is all fine is worth nothing if you need to negotiate or rescind. Insist on the written report.
Booking after exchange. By the time the inspector has a slot and the report is written, half your cooling-off period is gone.
Assuming a newer home is exempt. Recent renovations are exactly where unapproved or poorly built work shows up. If you find any, read our guide on unapproved building works for what it means to the buyer.
How to choose an inspector
- Check they are licensed and carry professional indemnity insurance.
- Ask whether the report is prepared to the Australian Standard for pre-purchase inspections.
- Ask for a sample report. The difference between a good inspector and a bad one is visible in ten seconds.
- Check what is excluded. Every report lists areas the inspector could not access, and that list matters as much as the findings.
- Attend the inspection if you can. Fifteen minutes walking the property with the inspector is worth more than the report itself.
Inspectors our clients use
These are local contacts our clients have used and been happy with. We receive nothing for passing them on, and you are free to use anyone you choose.
- East Coast Building & Pest Services
- Town & Country Building & Pest Inspections
- Aaron Riordan, 0413 545 348
- John Hassett, 0411 032 256
Buying in the Hunter or Lake Macquarie?
Send us the contract before you sign anything. Justin, Julie, Amanda or Nicole will read it with you and act on whatever your inspection report leads you to decide.
