House Destroyed. What Now ?

I was reading today about a house in Kurnell that was flattened in the recent storms. According to the article this happened 24 hours after it was sold. Does anyone know what happens to the buyer and vendor if the 10% was paid but house was still in settlement and what would happened if the house had settled

Cheers

 

In NSW, the risk as to damage remains with the seller until the completion of the sale, unless a purchaser enters possession of the property prior to completion, in which case the risk passes to the purchaser. Following completion, the risk as to damage is obviously with the purchaser.

A purchaser can claim a reduction of the purchase price where the land has been damaged. Where the land has been 'substantially damaged', the purchaser is entitled to rescind the contract and obtain a refund of the deposit.

 

With all purchases it is prudent to get insurance quote during the due diligence period (subject to building inspection and finance).

You might find the area is a risk and insurance is high and can pull out. Eg Brisbane $5k insurance in some suburbs.

Because been buying interstate we always settle the insurance up before goes unconditional. Only usually 1 month so it's worth the peace of mind.

In the above case, very interesting but can mitigate.

 

These guys were on the news tonight. They had no insurance. The potential new owner has told them they won't settle unless the house is in the condition it was at the time of the auction. Doesn't look good for the owners

 

Why would someone not have insurance is beyond me! Skimp on something really important and then whinge about it.

 

Agree. I a amazed that the banks allow their properties to be uninsured.

As tradies we have to show our insurances to every real estate we do work for. Our factory lease requires we show that we have insurance in place, even our workplace HR company requires that we show insurance on the Utes that the staff drive and that their personal tools are covered.

 

They don't but they don't go around checking either. I suppose they just assume everyone has a brain. Silly banks.

 

Yeah its funny that the bank often checks you have insurance noting then on the certificate at settlement but they never check again after that. Kind of assuming everyone sells after 1 year..

 

Thanks all for the info. Hard to feel sorry for people without insurance.

 

I remember reading in one of the articles that the sellers were hoping it all still went through.
From memory, it was sold at auction.

 

Is this the one: Family home destroyed in Kurnell hours after selling at auction

 

It's a breach of the mortgage not being insured - assuming that the improvements are worth 50% of the sales price (repairs are more expensive than a new build) the bank would have been exposed on their debt.