Final property inspection- what to look out for?
General condition 22 of the standard contract of sale gives buyers the right to a final property inspection. It states:
“The purchaser and/or another person authorised by the purchaser may inspect the property at any reasonable time during the 7 days preceding and including the settlement day.”
This allows buyers to conduct the final property inspection, at any reasonable time during the week, leading to, and including, the settlement date. It is advisable to conduct the final property inspection as close as possible to the settlement day.
Final property inspections can be arranged through the real estate agent. If there isn’t a real estate agent, it can be arranged by contacting the seller directly. It’s important to note some contracts of sale have special conditions requiring buyers to give a certain period of notice for a final property inspection.
While the buyer has a right to do one final property inspection, they can request the seller’s permission for further final property inspections. If there has been any concerns during a final property inspection, the seller should permit further inspections to ensure the issues have been rectified.
What is the purpose of a final property inspection?
The purpose of a final property inspection is to ensure that the property is in the same condition as when it was purchased and that any agreed-upon works or repairs have been completed. The final property inspection is typically conducted just before the settlement of the property, allowing the buyer to confirm that everything is in working condition before taking possession. It helps buyers identify any issues or discrepancies and gives them an opportunity to address these concerns with the seller before settlement. It serves as a crucial step in the home-buying process to protect the buyer’s interests and ensure a smooth transition of ownership.
What to look out for at the final property inspection?
With the exception of standard wear and tear, the buyer has the right to receive the property in the condition it was on the day the property was sold or the contract of sale was signed.
When conducting the final property inspection, common things to look out for include:
–> Ensuring the property is vacant.
–> Ensuring there has been no damage to the property since the contract of sale was signed and the date of the original inspection.
–>Checking that all appliances, fittings, electrical, plumbing and any other functions of the property are in working condition, or otherwise as originally inspected.
–>Ensuring all of the inclusions listed in the contract of sale remain in the property and have not been removed.
–>Ensuring that no waste, rubbish, building materials or bulky furniture is left in the house, or on the property, and that the house has been left in a reasonably clean state for handover.
–>Checking that the garden and landscape are in order
Notify your conveyancer in Melbourne of the outcome of your final property inspection so that they can proceed to settlement.
Concerns with the final property inspection
If you have any concerns after the final property inspection, your options are:
–>If there has been some damage to the property, this does not give you the right to delay settlement or withhold any funds at settlement. Contact your conveyancer so they can clarify whether this damage to the property is a contravention of the contract of sale. Your conveyancer may be in a position to communicate with the seller’s conveyancer, and relay your concerns to them for rectification.
–>If the damage is more than the anticipated ‘fair wear and tear’, you are only entitled to take action after the property has been settled. The buyer is not allowed to delay settlement, but may be entitled to compensation following settlement.
–>If there is substantial damage to the property, the seller is in breach of the contract and the buyer can ask the seller to fix the damage before settlement. In this situation, a seller cannot rescind or claim penalty interest if settlement is delayed.
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