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Pest and Building inspection- negotiate a discount

Discussion in 'The Buying & Selling Process' started by Big Daddy, 16th Jul, 2015.

  1. Big Daddy

    Big Daddy Well-Known Member

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    Hi
    I purchased a 1960's house and the pest report came back with the following items to monitor. (not really an item of concern)
    1)Chemical delignification was detected in some of the tile battens in the internal roof space.
    2)Wood decay was detected in one of the exposed eaves
    3)Rear security door does not lock with snib. Recommend replacing door. hardware and retain existing cylinder

    Would you normally negotiate a discount on the purchase price for these problems or let them slide? Price was mid 500's in Perth.

    Im ignoring leaves in gutters, cracks in walls, ceilings (small), corroded drains and shower heads etc
     

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  2. HD_ACE

    HD_ACE Game-Changer Premium Member

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    Worth a try. Could ask for a discount Or offer for owner to fix. I have done similar before for a sagging ceiling. Knocked 1500 off and it only cost me 800 to do it properly since they didn't want the hassel of fixing themselves.
     
  3. wylie

    wylie Moderator Staff Member

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    I would ask yoursef if knowing those things would have stopped you from offering on the property or would you have offered less? Would you have lost out to someone else by offering less?

    I wouldn't try it but that's just me. I hated it when our buyer (long time ago now) used piddling little things in the building report to negotiate the price down. It left a bad taste.
     
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  4. Hysteria

    Hysteria Active Member

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    I did on my last purchase. The building and pest came back with the usual issues for a 60 year old house.
    Requested a 10k reduction. Ended up with a 5k reduction. Spent about 700 on fixing up the required defects.
     
  5. citystar

    citystar Well-Known Member

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    You don't have anything to lose asking for a discount which you can substantiate with the building and pest inspection report. Best to get a discount on the purchase price and fix it yourself then leave it to them to fix before settlement.
     
  6. Big Daddy

    Big Daddy Well-Known Member

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    Thanks everyone
    Probably would have bought it
    Also I offered 42k over asking price if that's worth anything
     
  7. swanqueen

    swanqueen Well-Known Member

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    We did this with one of our properties. B&P came back with water damage to window frame and rotted timber frame in decking area. We got a quote to fix these two items and negotiated with the seller to reduce the purchase price by the amount quoted to fix.
     
  8. Perp

    Perp Well-Known Member

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    I'm like wylie; I loathe it when buyers do this for things that were readily apparent, or are typical for the age and style of building. It infuriates me, not because of the $, but because I think it's highly unethical. B&P should be for other things, such as mega-$ structural damage.

    If I could legally get my lawyer to argue that by counter-offering that they'd repudiated the contract (thoughts, @Terry_w ?), I'd terminate and take their deposit and put it back on the market.
     
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  9. Jamie Moore

    Jamie Moore MORTGAGE BROKER - AUSTRALIA WIDE Business Member

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    Is there a risk the vendor could move onto another offer?
     
  10. Azazel

    Azazel Well-Known Member

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    It depends. If you've budgeted for kitchen, bathroom, painting etc... due to the age of the property, but the B&P finds cut joists under the house or a leak in an addition or evidence of termite activity or concrete cancer in a support or a rotten beam in stairs/balcony or balcony not legal height or no wet seal in the bathroom. None of these are mega $, but it all adds up. Some jobs can be bigger once you start digging around too.
     
  11. Big Daddy

    Big Daddy Well-Known Member

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    When i was selling i was screwed on the purchase price but had to sell as house was constantly getting vandalised whilst vacant. eg A rock through just one french window as $700. Then i was screwed down again by the B&P report. This seller is ahead more than 40k so i dont see this as unfair

    The agent wont repair anything except a broken lock. The response from the rotten and decayed wood rafters was "There is nothing here noted as a major structural defect. See annexure BSR". Is he correct ?

    Just the other day a colleague at work negioated a discount due to hairline cracks in the wall plaster in a 60;s house in midland. The one i am buying has a sagging ceiling and plenty of wall plaster cracks. I was just hoping to be compensated for the rotting rafters.
     
  12. Big Daddy

    Big Daddy Well-Known Member

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    Doubt they would move on to another offer. They are in a hurry to retire plus i think i overpaid by bidding against a ghost.
     
  13. jaybean

    jaybean Well-Known Member

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    I always worry if you offer for them to fix it instead of a discount they will find the cheapest quote to get it over the line. I'd rather a discount so I can choose my own tradie. That being said, one of the last properties I purchased I negotiated for the owner to have a few things fixed and it was done reasonably well.
     
  14. Perp

    Perp Well-Known Member

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    What people seem to be missing is that the vendor's under no obligation to do either.

    The B&P is an opportunity for you to withdraw or proceed with the contract; it's a condition that's either fulfilled or it's not.

    It's not an opportunity to re-open price negotiations.
     
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  15. Azazel

    Azazel Well-Known Member

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    It's an opportunity to find any defects with the property, and if you don't like the word negotiate, then come to an agreement about fixing the issues. The vendor is under no obligation to sell, but they both have signed a contract and usually want to come to a mutually beneficial outcome.
     
  16. Perp

    Perp Well-Known Member

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    Right, the buyer's signed a contract on an "as-is" basis.
     
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  17. wylie

    wylie Moderator Staff Member

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    The "but if..." repairs you have listed are a looooooong way from the seemingly minor issues found by the initial poster and around which the question was raised.

    There are things that, if found, and were not noticeable (legal height or lack thereof is pretty easy to spot, for example), would be grounds to crash a contract. But things that can easily be seen like rotten timber in a barge board, or lower than legal height, or similar are things that are seen before the contract is entered into and to try to weasel the price down is wrong in my book.

    Unless the issue found is major and would have meant not entering the contract, I think it is wrong to try to negotiate down.
     
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  18. Azazel

    Azazel Well-Known Member

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    Not quite. In my hypothetical contract there was a subject to satisfactory building and pest inspection reports condition.
     
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  19. Azazel

    Azazel Well-Known Member

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    I'm not a builder or a tradie. I'm not even that handy. I don't see my lack of expertise in this area as a setback, I outsource it to someone who is qualified. That's why I pay for a building and pest inspection. That's why I get quotes to fix anything that is picked up during the inspection.
     
  20. Greyghost

    Greyghost Well-Known Member

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    You can ask, they can say no.. Then your choice if you crash the contract over a few grand..
    Ive just done a B&P on a place and now waiting on an engineers report on a crack in the brickwork.
    Just because the B&P reveals works to be done does not mean you need to neg a discount. It is a bargaining chip. But like poker, you need to know about the vendor, other offers potentially on the table, how urgently they want to sell, settlement terms etc.. Just need to play it right. Also, not being short sighted over a few grand (if you have it that is)...
    Good luck