Building and Pest Inspection Advice

Hi everyone,

I am currently in the market to purchase an investment property in Newcastle. The properties we are looking at are old and require renovations (some in very run down condition).

Is there a specific inspection, I should be getting to ensure I don't end up buying a lemon. I want to stay from anything that involves structural work.

Are all B&P inspections standard or some more extensive than others.

Thanks in advance for your valuable advice.

 

Hi mayjong,
I had a b&p done for a property about 18 months ago by the local president of the master builders association. He missed a structurally unsound verandah, told me that a 2 metre termites nest in the back yard was inactive (it wasn't - it was 39 degrees!) And that there was no evidence of past termite treatment (there was pink arsenic under the house). He also missed active termites under the house. I was a bit suspicious of crumbling coming from the ceiling (house about 100 years old) so got a second pest inspection and they found the termites. A handyman used by my property manager picked up that the verandah wasn't structurally sound so I had to get an engineers report before the original p&b builder would fix it. My understanding was that I was pretty lucky for him to have fixed it because my solicitor said it was a matter of taking him to fair trading or suing him. I would suggest asking property managers who they use for their pest inspections and who they recommend as builders. They tend to sort the good ones from the bad. I use Leah jay at hamilton for my property in Newcastle and they are fabulous.

 

By the way that p&b inspection wasn't in Newcastle - don't want to sully the name of the Newcastle president of master builders association!

 

Thanks for the detailed reply. My friend once told me that you can also request an inspection where they come with some special scanners that can pick up defects behind the wall / roof etc..does that sound right?

Are you able to give me leah Jay's number / details? How much do they charge?

 

I used Jims Building & pest inspection they charged $440

 

Thanks..

Would you rely upon a report done by Vendor or would you always order your own.

 

Hi mayjong,
Leah jay's number is 49653153. They charge about 8 percent I think but I have found them to be worth it. (I think you might get a reduced rate if you have multiple properties with them but I only have one in Newcastle). They have won NSW property manager of the year multiple times as they only do property management, no sales. They take a tough approach in some respect (start eviction proceedings if 2 weeks in arrears for example) but do it because the eviction process can take so long so they view it as looking after the land lords. Luckily I've only ever had the same tenant.
I've had the thermal imaging done before as well but there is still a disclaimer with that too. I guess you can never be completely sure but I definitely wouldn't go with any report that the vendor provides. B&p won't move anything out of the way for their inspections so it would be very easy for vendors to cover cracks etc with furnishings and the inspector wouldn't be able to see them. It is abit tricky and I have wondered if they are actually worth it. Might be better just to get a builder through to quote you on what needs doing...

 

Personally would never trust any report supplied by the vendor or their agent. I've had a report done through a private company, another supplied by the vendor, and an agent which were all different, in the end no property is going to be sound/perfect. Just gotta go with what your gut says IMO.

 

@Mayjong

You can go for standard B&P.

If report comes back with structural issues, consult a builder and get structural engineer's report!

 

Thank You

 

I should correct my cost... Jims building inspection cost me $495 including GST... Next time i will shop around !!!

 

Always get your own inspection done by an I dependant inspector. You will be right with just a building and pest inspection. If the inspector does his job properly than he should pick up every visual defect. Some inspectors use thermal imaging which can pick up if there is an moisture in the walls.

I will be using thermal imaging once I start my inspection business.

 

The problem is .. If you buy in a small Regional town .. There chances are the BI knows the Real Estate agent or even the Vendors.

 

Yes, but Newcastle is not a small regional town. There are multiple P&B inspectors to choose from.

 

@Propertunity what's your view about houses in Jesmond that rents out to students? High Yield but will CG improve over the long term? I'm not talking about those houses where owners modified it to become 10 rooms but say a townhouse that has 4 rooms and rent out to 4 students. It's interesting to note there are different markets in Newcastle alone.

 

Personally, I would not be buying there at the present time:

1. Canada (apparently) has poached some of the foreign students we used to get coming here
2. Last year, for the very first time, NSW introduced boarding house legislation with fire safety requirements and audits from local council
3. Uni construction has taken some students out of the private market
4. There are lots of “for lease” signs (high vacancy) in the private market and lots of investors looking to unload their student accom properties.

Jesmond being further out has always had (s)lower CG than suburbs closer in towards the CBD. But that is true of almost anyplace you can think of. I see no reason why that might be changing in the foreseeable future.

 

It makes sense. It does sound like Jesmond is a student suburb and at risk. Additional requirements for the property makes it less desirable. But what is the difference between a boarding house and a residential property that rents out rooms to students? Any technical differences? The yield will attract those who chase CF.

 

There are currently two boarding houses in Mayfield for sale if your interested.
One for 525k , they are registired/licensed with Dept of Fair Trading.

Boarding houses have strict fire codes, are insured as such , and usually receive yearly council inspections.i think they are also exempt from Land tax ?
I believe there must be a resident manager on site.
The one at Mayfield was 9 bedrooms and return according to the agent trying to sell it to me was gross $1500 a week.
It housed people with mental illnesses etc.

 

In theory they should be to a similar standard, but as with anything, they're going to differ based on competence/experience.
Going on a recommendation couldn't hurt.

 

Hi Darlinghurst Boy, with the building inspection industry now deregulated in Australia it is crucial that you do your due diligence. Pay particular attention to exactly what is included in the inspection,the inspectors experience and the amount of time they will take to conduct the inspection.
A good inspector will return his fee to you by identifying defects that may be negotiated on,ensuring you purchase a safe house and identify maintenance items which require addressing now to save you future costly repairs or replacement. The inspectors fee should align closely with the services he is providing. The inspection cost alone is a poor way to select an inspector.