Issues with Building Inspection? What now?

Discussion in 'The Buying & Selling Process' started by GreenTea, 23rd Jan, 2020.

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  1. GreenTea

    GreenTea Member

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    When and how do you negotiate price reduction with building issues ?

    Under Australian Standards these issues are NOT major and only minor. The property is 2 years old.

    Examples:
    1. After a rainy night a small (80x20cm) puddle of water in the yard was noticed. Clearly that area is not sloped properly. Easy to fix or not ?
    2. It seems the small door to the garage allows some water to seep inside the garage. It's not the same poorly sloped area in the yard but it clearly is from the door.
    3. Bedroom door is slightly jammed, not severe but annoying to open and close.
    4. Some windows are slightly jammed as well.
    5. Small cracks and gaps around the skirting boards.
    6. Loose towel rails and water taps.

    The house is 2 years old. What recourse action do I have? I'm still in the 3 days cooling off period.

    Thanks in advance.
     
  2. Archaon

    Archaon Well-Known Member

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    sounds like it would all fall under warranty from the builder.

    Is the builder still trading?
     
  3. Marg4000

    Marg4000 Well-Known Member

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    You have 3 options
    1 proceed
    2 withdraw from contract
    3 renegotiate. But as the issues are minor, don’t be surprised if the vendor refuses.
     
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  4. Brady

    Brady Well-Known Member

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    Sound like you're buying a 2 year old house.
    It's not a house you built.
    It's not a brand new house.
     
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  5. Brady

    Brady Well-Known Member

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    Seriously though what's the building inspector suggested, are these actually issues?
    1. It's rained, there is water.
    2. Sure it's not the wind blowing the water in
    3, 4, 5. seriously pretty minor things.

    Don't like the house pull out. But you're not buying brand new.
     
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  6. Scott No Mates

    Scott No Mates Well-Known Member

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    1. Get a bucket of soil
    2. Put a seal under the door eg a weather seal or water bar[/QUOTE]
      Get the door adjusted and repaint the edge.
    3. Run some wax up the stiles
    4. Small cracks and gaps around the skirting boards. [/QUOTE]No more gaps
    5. Handyman can tighten
    [/QUOTE]

    Should be able to put these back on the vendor.
     
    Last edited: 23rd Jan, 2020
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  7. Peter_Tersteeg

    Peter_Tersteeg Well-Known Member Business Member

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    Everything mentioned is to be expected from a 2 year old house. I wouldn't offer any discount for any of these things.
     
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  8. GreenTea

    GreenTea Member

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    1. Proceed without negotiation ?
    2. That's a bit extreme for these issues? Isn't it?
    3. When and how do I negotiate?
     
  9. The Y-man

    The Y-man Moderator Staff Member

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    Note to self: when I am selling get my agent to only ever allow B&P inspectors access on a dry day.....

    The Y-man
     
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  10. Brady

    Brady Well-Known Member

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    1. yes buy as is as these items are expected for an established property.
    2. bit extreme to expect discount for these, did you notice them or just the inspector - did you expect them to find nothing at all...
    3. before cooling off, but as stated by others I wouldn't discount based on this work.
     
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  11. The Y-man

    The Y-man Moderator Staff Member

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    Would also depend on the wording of the special condition. If it is something along the lines of "satisfactory building and pest inspection" minor issues may be considered "satisfactory". If the wording is "to the buyer's satisfaction" different meaning altogether.

    The Y-man
     
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  12. significance

    significance Well-Known Member

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    When I ran into issues that came up in the building inspection and other due diligence checks, I asked myself, "Do I still want to buy it at this price, knowing what I now know?" For the first property I'd put an offer on, the answer was "no". So I asked myself, "at what price would I still be happy to buy it?" I came up with a figure $10k below what I had originally offered and told the vendor "if you fix these issues or drop the price by $10k, I will still proceed. If not, I am out." They decided to take it back to market instead, and repay my deposit (since I had a clause in the contract allowing me to pull out if I wasn't satisfied by the due diligence checks). That was fine by me: $10k wasn't an ambit claim, but an honest assessment of what the problems were worth to me. The vendor correctly judged that if they put it back on the market, another buyer wouldn't notice or wouldn't care about the problem and they could get a slightly better price.

    The second property I put an offer on had a couple of very minor issues. Again, I asked myself "do I still want to buy the property at the agreed price now that I know about these issues?" This time, the answer was "yes." So I didn't ask for a price reduction, but simply reported the issues and gently asked if they could be fixed before settlement. A minor plumbing issue did get fixed, and another minor issue didn't get fixed, but there was no embarrassment and we were both still happy with the outcome.

    I see both results as wins.

    If you don't have a "to the buyer's satisfaction" due diligence clause in your contract, you stand to lose your deposit if you pull out. Treat the deposit as a sunk cost -- is the property worth the amount that remains to be paid? If not, then it is better to pull out and lose your deposit if the vendor won't fix the issues. If it is still worth the amount remaining to be paid, then it is not (IMO) worth losing too much sleep haggling over minor repairs.
     
  13. significance

    significance Well-Known Member

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    That's the thing -- it's your call whether withdrawing from the contract is extreme for these issues. Most would probably say it is, but it's your call. However, if it is not something that you would consider withdrawing over, you don't have any negotiating power. The vendor has no motivation to fix the issues other than good will or fear that you will withdraw.
     
  14. The Y-man

    The Y-man Moderator Staff Member

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    ...and all this is why I do my B&P before putting in an offer - just saves all the uncertainties, hassles and even if the cooling off is exercised, it still costs you the higher of $100 or 0.2% of the purchase price.

    The Y-man
     
  15. Lindsay_W

    Lindsay_W Well-Known Member

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    How much $ do you think it would cost to fix these minor maintenance items? Couple of hundred dollars?
    I'd personally start there and decide if it's even worth negotiating with the vendor, just my 2 cents.
     
  16. Paul@PFI

    [email protected] Tax Accounting + SMSF Business Plus Member

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    All property (even brand new) has minor defects. And they will continue forever...Thats why you must maintain property. You may well use condition as grounds to discuss price but frankly a half decent agent will not budge on these minor condition issues alone. However for a property that is over priced or challenging a sale it could be a clincher. I would tread carefully. You are buying the property in the condition inspected. If you want a pristine property you are being unrealistic. Selling agents may want to show you a different property with more condition issues but at a already great price and may hesitate if they think you are a time waster.
     
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