All you need to know about Building Inspection Reports

Why a pre-purchase building inspection report?

This is one of the different types of building inspection reports you can get done. As the name says, this building inspection report is the one you get before you buy a property. Sometimes referred to as a ‘standard property report’, a pre-purchase property inspection report is a written account of the condition of a property. It will tell you about any significant building defects or problems such as rising damp, movement in the walls (cracking), safety hazards or a faulty roof to name a few. It is usually carried out before you exchange sale contracts so you can identify any problems with the property which, if left unchecked, could prove costly to repair. Throughout this web page we will refer to the report as a ‘building inspection report.

A building inspection report is different to a pest inspection report. While a building inspection report should identify any visual damage that may have been caused by termites, it usually won’t include the existence of termites or other timber destroying pests. It can be advisable to get a separate pest inspection report done before you buy a property.

Why do I need one?

There are three good reasons why you should get a building inspection report done before you buy a property:

So you’ll know in advance what the problems are
So you can use the information to try and negotiate a lower price for the property i.e. you may have to pay to repair some of the problems
So you can get specialist advice about any major problems and how they will affect the property over time.

Of course, the building inspection report will be one of many things you will need to consider before buying a property.

Who can do a building inspection?

Only building consultants licensed under the Home Building Act 1989 are permitted to carry out pre-purchase inspections of residential properties in NSW. Other inspections, e.g. pest inspections, do not require a licensed practitioner but ensure the inspector is workcover approved contractor.

What’s in a building inspection report?

The format and amount of detail in the report will depend on the type of property, its size and age, its condition and the reporting process used by the consultant or organisation preparing the report. These factors will also influence the cost of the report.

Some building inspection reports will adopt a standard format or use a comprehensive checklist while others will be individually tailored for each property. Photographs may or may not be included. The important thing is that the report complies with the Australian Standard (AS 4349.1).

A building inspection report should include enough information for you to be aware of the property’s condition and identify any significant problems.

General information

The consultant should inspect all accessible parts of the property. These include the following areas:

interior of the building
exterior of the building
roof space
under-floor space
roof exterior
site.

You may also like to ask that a particular part of the property also be inspected.

The site

The following items would normally be included in a building inspection report:

garage, carport and garden shed
separate laundry or toilet
small retaining walls (ie. non-structural)
steps
fencing
surface water drainage
stormwater run-off
paths and driveways

Make sure you specify any particular items or areas on the site that you want inspected.

Other important information

The report should also include the following information:

your name
the address of the property to be inspected
reason for the inspection
the date of inspection
the scope of the inspection
a list of any area or item that wasn’t inspected, the reasons why it wasn’t inspected and if necessary, a recommendation for further investigation
a summary of the overall condition of the property
a list of any significant problems that need fixing
if necessary, a recommendation that a further inspection or assessment be carried out by a suitably accredited specialist, e.g. pest inspector, electricity supply authority, water supply authority,
structural engineer, geotechnical engineer, surveyor or solicitor

The summary

The summary is possibly the most important part of the report. It should give you a brief summary of the major faults found in the property and its overall condition considering its age and type.

What’s not included in the report?

A building inspection report usually won’t include:

parts of the property that weren’t or couldn’t be inspected
matters outside the consultant’s expertise
an estimate of repair costs
minor defects
termite detection.

A building inspection report shouldn’t be seen as an all-encompassing report dealing with every aspect of the property. Rather it should be seen as a reasonable attempt to identify any major problems that are visible at the time of the inspection. The extent of any problem will depend to a large extent upon the age and type of property.

While the report will give you valuable expert advice, it won’t cover everything.

The consultant normally wouldn’t check things such as:

footings
concealed damp-proofing
electrical wiring and smoke detectors
plumbing
drainage (including site drainage)
gasfitting
air conditioning
garage door locks
swimming pools and pool equipment
watering systems
fireplaces and chimneys
alarm systems
intercom systems
carpet and lino
appliances such as dishwashers, insinkerators, ovens, ducted vacuum systems, hot plates and range hoods
paint coatings
hazards
every opening window
television reception.

Strata schemes and company title properties

With strata scheme and company title properties, the consultant will normally only inspect and assess the condition of the interior and immediate exterior of the unit you’re thinking of buying. If you want the consultant to inspect other common property areas you will need to request a ‘special-purpose’ property report.

You should contact the secretary of the owners’ corporation or company to enquire about the history and cost of repairs to other units and the common property. This information is important as the cost of repairs to common property can in some cases be substantial. Owners normally share the cost of these repairs.

Minor defects

Most properties will have minor defects such as blemishes, corrosion, cracking, weathering, general deterioration, and unevenness and physical damage to materials and finishes. If you want the consultant to report on minor defects and imperfections you will need to ask for a ‘special-purpose’ property report.

Factors affecting the report

There are certain conditions you should be aware of that will affect the final report. These include:

problems that are difficult to detect due to weather or other conditions such as rising damp and leaks
the information you provide to the consultant
the specific areas of the consultant’s ‘expertise’ as specified in the report
problems that may have been deliberately covered up to make an area appear problem free.

It may be difficult to detect leaks and other problems if services, such as water, haven’t been used for some time. For example, if the shower hasn’t been used recently, leaks or dampness may not be obvious.

Using the report for other purposes

This type of building inspection is carried out specifically for the information of home buyers. Its main purpose is to give you an expert’s view of the condition of the property you’re interested in buying.

It is not intended to be used as a certificate of compliance for any law, warranty or insurance policy against future problems. Nor is it intended to estimate the cost of fixing problems. If you want the consultant to estimate the costs of necessary work you will need a ‘special-purpose’ property report.

It is normally the role of your conveyancer or solicitor to deal with all law-related matters. The building inspection report can’t comment on things like the location of fencing in relation to boundaries, as this needs to be done by a registered surveyor.

In our next post we’ll discuss some tips on how on choosing a Building Consultant

Effective Building and Consultancy is the leader in building and pest inspections around Sydney, get in touch or learn more about us.