Introduction
You have found the home that you wish to purchase and have now decided to enter into a contract to buy the home. If you are being sensible about the purchase, the contract will be subject to certain conditions. These conditions, above and beyond normal conveyancing issues, should include both a satisfactory building inspection and pest inspection.
There is a certain amount of excitement in purchasing a home but unless certain procedures and protocols are observed, you risk moving into a home that will become uninhabitable and possibly losing many thousands of dollars that you have invested in the purchase of your new home.
These issues warrant careful consideration and meticulous care so that the decision to purchase a home does not turn into a disaster. The great Australian dream would rapidly become a nightmare!
What You Need To Know
The first thing to note is that you should always attain the independent advice from building inspectors and pest managers who are both ethical and reputable. They should be able to produce a clear and definitive report which clearly sets out problems, or potential problems, that may affect the structure of the existing home.
Real estate companies and their agents generally try to assist a simple and easy passage of the purchase by working with the people integrally involved with the sale of the home. The people that are involved in the sale include financiers, solicitors, building inspectors and pest managers who respectively provide financing, conveyancing and the inspection reports that onwardly provide a smooth transition through to a completed sale.
It is not uncommon to find business cards for financiers, solicitors, building inspectors and pest managers provided on desktops of real estate agents. A totally independent building or pest inspector is necessary to serve your best interests and needs. You should therefore avoid using any of the individuals or companies whose building and pest inspection services are either recommended by the real estate agent involved in the sale or whose business cards are placed strategically for you to find on a desk or table in the real estate office.
The real estate agents or agencies have a strong vested interest in seeing the sale through to completion as this is how they make their money. If the sale fails to proceed, then they do not receive their commission on the deal. Commission is generally only paid once the sale becomes entirely unconditional and the exchange of funds and documentation is complete.
The Problems With Vested Interests
Current affairs shows and newspaper articles attest to the many instances where people have purchased homes where building and pest reports have not provided the new homeowner with accurate evaluations of the problems and/or potential problems associated with the purchase of an existing home. This is quite a common occurrence with many home purchases ending in absolute disaster for the new owner.
Building and pest inspections can often fail to identify massive infestations of termites and the associated damage throughout the structure of the home and the resultant costs of treatment and repairs then become the responsibility of the person purchasing the home once the sale is completed. Disclaimers on the pest inspection report generally absolve the pest inspection company from any blame in the matter. Don’t bother even thinking of going to court over the matter as your chances of winning such an action are practically nil in these circumstances.
“Let the buyer beware!”
This is why you must get the sale right at the front end and not rely on the ‘good will’ of the real estate agency which generally works specifically towards its own interests, despite what you may be advised. If you do happen to purchase the home and it is full of termites, then from past experience with other homeowners I can advise that whilst all concerned parties sympathize and say how sorry they are for you, at the end of the day they are unable to assist you further.
The fact is that the sale is completed and they have their money.
“Game over!”
What You Need To Do!
As the new potential home owner, you must establish the following things about the home. Firstly, you must establish whether or not it has had previous termite attacks, or currently has termites in the structure. You then need to establish what systems or devices are in place to defend the structure against termites.
Many existing termite management systems that are generally integrated into the construction of the home are either ineffective or unable to provide an appropriate level of defence against termites.
If you are to complete the purchase, you will definitely need to know the limitations and onward maintenance requirements of the systems or devices in place to defend your home. You must be fully aware of any potential risk to the structure.
Physical termite management systems that are generally built into the lower brickwork and the cavity of the home can often provide cause for concern. It should be noted that the warranty on all these products covers only the ‘breaching’ of the system. This means that the termites must go through the system for the warranty to be invoked if it is still in force. This can be hard to detect or prove given the location of these systems.
Pest managers are unable to fully inspect these physical integrated systems because they would have to dismantle brickwork and cut through internal walls so as to be able to view the system.
It is a very common occurrence for termites to go around or over these physical systems and not through the system. This is known as ‘bridging’ of the system and absolutely no warranty is provided in this instance.
In most cases, Homeowners are generally unaware of the risk involved with ‘bridging’ by termites.
Improper Advice
Often, people are advised that they have a product that ‘protects’ their home against termites.
Any experienced pest manager would advise that this is generally a furphy. The best means by which a home can be free from the ravages of termites is through a rigorous ongoing inspection and maintenance program. There is no such thing as ‘protection’ against termites as any good pest manager would advise except for complete borate timber treatments. Termite management is about ‘risk reduction’.
Constant vigilance is required!
A properly installed chemical treated zone in an appropriate soil medium still provides the best deterrent to termite ingress. Inspection zones must be free from gardens, pathways or other impediments for ease of viewing and so that undetected access by termites does not take place.
Where a physical termite system is the only means of termite management for the home you intend to purchase, it is generally considered a wise move to factor the cost of installing a chemical perimeter treated zone into the purchase of the home.
If the home has a chemical treated zone in place, make sure that it has not been disturbed and check as to whether it requires reinstatement. This is important and it may well impact on the life of the home.
Many chemical treated zones were not properly installed when initially placed in the ground by corrupt operators. These barriers were generally either under-sprayed with too little chemical or used no chemical at all in the perimeter treatment. Often improper soil mediums were utilised that were unable to hold the chemistry.
The perimeter of the home should also be checked for inadvertent bridging of termite systems by raised garden beds, covered weep-holes, pathways, etc. A competent pest manager doing an inspection can advise of any individual circumstance(s) that may potentially provide bridging access for termites into your home.
We now have a checklist of things to do when buying an existing home.
Making A Checklist
1) Make any purchase contract ‘subject to’, or ‘conditional upon’ both a satisfactory building inspection and a satisfactory pest inspection.
2) Do not accept any business cards or offers from the real estate or their agent in relation to engaging these inspection services.
3) Engage the services of independent pest and building inspectors that are competent, ethical, professional and able to clearly set out any risks and problems in a definitive report. Make sure that they are properly insured and have the appropriate licenses.
4) Make sure you clearly understand the inspection report(s) with regard to limitations, problems or potential risks that may emanate from the findings. Ask about any disclaimers and check all clauses.
5) Question the pest and building inspectors in relation to how extensively they conducted the report. Often invasive measures, like opening up wall cavities, are required to fully determine termite activity or damage.
6) Establish what termite management systems or products are in place, if any, how effective they are, their limitations, and what is required in relation to the onward maintenance and inspection of these systems and/or products. Advice on the termite management system installed in a home is generally on a sticker placed in the electricity box on an external wall or sometimes in a cupboard under the kitchen sink.
7) Ascertain that appropriate inspection zones are in place wherever physical systems are the primary form of termite defence.
8) Check that any chemical perimeter treated zones have not been disturbed and that they have been maintained and regularly retreated as per their requirements.
9) Factor the cost of a chemical perimeter treated zone into the purchase of any ‘slab on ground’ construction home where physical termite management systems are the primary form of defence.
10) Check for signs of previous termite activity where concrete drilling or cutting has occurred so that chemical treatment could be applied, as these signs will devalue the dwelling accordingly.
Until all the applicable issues in 1) through to 10) have been satisfactorily addressed, you should not even consider completing the purchase no matter how persuasive the argument of the vendor or real estate agent.
So, forearmed and forewarned, good luck and good hunting with your purchase of an existing home.
One Comment (Leave a Reply)
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