Shaving one or two thousand off a property’s asking price is commonplace in the real estate business. Perhaps the air conditioning unit doesn’t work or the hot water system leaks and you want discounts for these problematic amenities. If you’re aiming for larger deductions, however, you’ll have to identify major defects, get a cost estimate if you have them fixed, and have the vendor recognise the problem. Of course, you only get the ball rolling with the aid of a building inspector.
While minor damage may be worrisome to most buyers, the seasoned investors often use these as a leverage to negotiate a price reduction from a seller.
Whether you’re new to the real estate jungle or not, you probably know that building and pest inspections are part of any property buying process. Many will find the process troublesome but most will agree that it’s completely essential, especially when the goal is getting a property that wouldn’t become a headache down the track.
In fact, most home buyers treat this service as a kind of insurance policy to ensure they don’t get the short end of the stick once the sale is complete. However, building inspections Melbourne don’t just steer you clear of expensive disasters because the prospect asset turns out to be riddled with termites or asbestos.
To get the subsequent property assessment saving you thousands off the asking price, you might want to take note of these savvy tips.
- Take note of water damage and dampness.
Once the report identifies the presence of water damage in the property in question, you can actually use this information as a means to ask for a lower price commensurate with the cost of fixing the said damage. You can even add a little financial “cushion” to the sale agreement to account for the time and effort required to arrange for the relevant repairs.
But don’t just recommend getting water damage accounted for in the property’s asking price. At the end of it all, you still have to make sure to get the appropriate fixes done so the problem won’t be a recurring issue. On that note, it’d be best to get more than one quote so you can find which contractor gives you the best value for your money.
- Be stern about structural vulnerabilities.
Rusty roofs, cracked stumps, and unauthorised building works are not only expensive to fix, but they can also result in legal issues. The same goes for faults concerning retaining walls, balconies, and even pool fence compliance. Indeed, discovering these structural issues is one sure way to slash a substantial amount off the property’s declared market value.
With the aid of a comprehensive pre purchase building inspection, you increase your chances of finding these safety hazards. Once the findings indicate such vulnerabilities, you can get the upper hand on the seller once the negotiations begin. Negotiate for the cost associated with sorting out these safety concerns and you could save up as well as get bonus renovations (if the vendor feels obliged to do so).
- Pay closer attention to bedrooms.
In some cases, the number of bedrooms in a house can have a huge impact on the property’s value. With that said, a building inspection report can help you determine if each one is legally habitable. For the most part, the size of windows, the ceiling height, and the room size are all factors to consider when assessing if a room can be legally considered a bedroom.
If one or two of these rooms aren’t deemed suitable as described in the advert, it might just be your ticket to a huge discount. You can instantly negotiate a lower price for a residential property when the inspector declares in his/her findings that one of the bedrooms just isn’t suitable for its expected function.
- Watch out for asbestos.
Many house buyers will instantly stay away from properties containing asbestos but savvy real estate investors will see such dangerous materials as a means to save money. With aid from a timely building inspection, you may help uncover if that may be the case for the prospect estate you’re planning to purchase.
Once traces of these materials are found, you may have to put in the work to ensure that this discovery can be used to your advantage on the negotiation table. For one, you have to check the law in your state regarding asbestos removal and then get quotes on the cost for removing and replacing the affected wall and roof with a non-carcinogenic alternative. Afterward, you have to present your proposed clean-up plan to the vendor and see if he or she will be motivated to appease your demands (in order to secure the sale).
While it’s sad to think that around a third of Australian homes built before 1986 have some traces of this carcinogenic fibre somewhere in the premises, you can actually make it work to your benefit with a little bit of effort on your part.
Most major issues like inadequate surface drainage or rusty roof (one that needs replacing) can be something you can use as leverage while negotiating for the property’s price. Not everything can be used for this objective, though. Problems like stiff windows, peeling paint, loose towel rails, expired termite barriers, and minor dents on the garage door can’t become subject for negotiation. The only time they can be worth considering for price reduction is when there are a great number of these minor faults detailed in the inspection report that correcting them will require a bit of renovation.
The truth is that vendors aren’t legally bound to negotiate for price reduction and their willingness to sit and discuss the matter with you will depend on a number of factors. If the seller has received multiple offers for his or her property and he/she has got a backup contract to boot, negotiations will not likely be in your favour. However, if the vendor is highly motivated to get the property off his or her hands, you may have a good chance to get a price much lower than the initial one.
If you happen to find yourself in this favourable position, get in touch and we’ll deliver you a building inspection report that might just help you shave off big bucks on your next property purchase.