Building inspections have been a routine part of the home-buying and building process for decades, and with property laws updating definitions more strictly to the demands of safe construction and maintenance in new and existing homes, the benefits of paying for inspections are crystal clear.
Have you ever wondered why people spend hundreds of dollars for one or more building inspections? It’s not only because the recent housing boom and increased property costs in Australia and many other parts of the world has meant that people need to be smarter about their investments, or that property laws are cracking down, but also because the reputations of rushed building schedules especially for larger housing developments or apartments paired with issues that continually haunt older properties mean that the risk and responsibility falling to the buyer is higher than ever.
Carrying out due-diligence to avoid problems and added costs down the track is commonplace, and it’s important to find out as much as you can about the integrity of a property in the process of building or before you buy.
Gone are the days where buyers purchase properties without thorough evaluation. Today, building inspections are performed by highly trained specialists who can pinpoint problems in a home and how they’ll affect the property over time.
The first known building inspection company was called Home Equity Loss Protection Services dba/H.E.L.P.S. and was based in Wheaton, Illinois which eventually incorporated in the early 1980s. The founders of the business, Christopher P. Nolan and Loyola Professor, were inspired to create a comprehensive and thorough system of inspecting homes. This was mostly inspired by the fact that Nolan was a keen investor in distressed real estate.
He had noticed a gap in the market for skilled professionals to inspect key areas of the home for buyers before they make what could possibly be the biggest financial transaction of their lives. To him, having homes inspected would lessen the chance of a buyer purchasing a home that would be a source of problems and financial distress down the track.
Today, the building inspection industry has expanded and diversified, especially in developed parts of the world like Australia, the UK and North America. Building inspections are now conducted throughout different phases of construction; when people are buying, when people are selling and even for just certain sections of the home.
The Australian Standards for building inspections are produced by Standards Australia and were first published as AS 4349.1-1995 In 1995. These standards were revisited and updated in 2007 to reflect industry changes and are now known as AS 4349.1-2007.
While these standards for building inspections exist, there aren’t really any nationwide legal regulations for who undertakes them, making it especially important that homeowners hire someone who is qualified, certified and experienced to be doing the job.
Home inspectors generally check building structure, plumbing, electrical, roofs, basements, heating systems, water heaters, and air-conditioning systems. They are trained to look for major defects, dodgy building practices, consistent damage over time that may lead to larger issues, things that will need to be repaired, as well as any safety issues the home presents.
Before hiring a building inspector, make sure they are focusing on the things that matter. So, not so much if a drawer is loose, but more on things that either compromise the structural integrity of the home, or that can be a big costly problem down the track.
While regulations around who can conduct home inspections are a little murky, it’s important to understand that there are laws in place that definitely highlight the need for building inspections, especially when purchasing a home.
Let us explain. In some states and territories in Australia, a home buyer is bound by a time limit in which they can report any faults or defects in a property. If a buyer uses an experienced and professional building inspector they’ll not only be able to detect such issues, but will also be able to report on time if there’s an issue and conduct legal proceedings if required.
For example, if a buyer purchases a dodgy property in the Australian Capital Territory (ACT), then they can invoke provisions of the 2003 Civil Law (Sale of Residential Property) Act against the seller or real estate agent for either a) failing to provide a building compliance inspection report, or b) supplying the buyer with false documentation.
However, if it’s proven that a seller did not misrepresent the home or partake in fraud, then they’re not liable for a defective property. Making it all the more logical to engage the services of a professional and thorough building inspector – because at the end of the day, this ACT law (like other states) is really just a case of caveat emptor – buyer beware.
In Queensland, a Contract of Sale allows time for the buyer to obtain a building and pest inspection report. If destructive pests are found in the home, the buyer doesn’t need to go ahead with the transaction.
If a property buying transaction happens in any other state or territory, the only legal proceedings a buyer could take would be to go after damages for misleading and deceptive representations about the structure of the home. This route, however, is very, very costly.
In New South Wales, buyers are receiving a bit of a leg-up with a new regulation coming into force on the 1st of July 2016. Clause 33A was added to the Property, Stock and Business Agents Act 2002. The clause states that agents must disclose any prior building inspections of the property to prospective buyers requesting a contract of sale:
However, agents don’t have to supply a building inspection if they don’t know about it or can’t reasonably obtain it. It’s no wonder that property industry professionals and experts are calling for change and reforms to better protect buyers.
Again, this highlights how crucial it is for buyers to engage their own building inspector to cover themselves in the case of misadventure.
In Australia, the main property inspection types are outlined below:
A personal inspection is an informal initial sweep of potential concerns done by the prospecting owner themselves. When considering purchasing a property, it’s important to personally inspect it with a view to hire a professional building inspector next when other purchase intention criteria are met. It’s also a good idea to have another set of eyes, so be sure to bring someone along with you. Once you’ve looked at a property yourself, you can speak to your building inspector about some areas that cause concern.
If you noticed some of the smaller issues (cosmetic problems, loose door knobs etc) then it leaves room for your building inspector to focus on the bigger issues that can really affect your bottom line.
When you go to an open home, look out for the following:
A building and pest inspection is something that’s done before buying a property and should be carried out by a licensed, insured and experienced building inspector.
A building inspection looks at common issues such as:
When a pest inspection is combined, qualified building inspectors are trained to look for and report on: active and inactive timber pests, in-wall or roof and underfloor pests, their location and the extent of damage caused.
A new home inspection is carried out in four stages to ensure the process of construction is inspected by an impartial and qualified professional. These stages include:
Investing in a new build comes at a significant cost, so ensuring that every stage of a new property is built to the right standards isn’t just a good idea – in fact, inspecting some stages of the process is actually mandatory.
Building inspections on new builds are carried out by qualified building surveyors or building inspectors. They are experts on the Building Code of Australia, as well as having a thorough understanding of building regulations in the region they operate in.
Depending on what state the building takes place in, the building surveyor or inspector may need to be accredited with the Australian Institute of Building Surveyors (AIBS) and hold an active state-issued license.
While building inspectors generally look at all accessible parts of a property, it is important to mention any specific sections of concern on the property if it conflicts with a purchase decision or has caused issues in the past.
If you have very specific requests, you’ll want to make sure that what needs to be looked at is within the realm of your building inspector’s expertise and that it fits the inspection type or package purchased.
As building inspecting has become a normal part of buying and selling homes, some of the more popular focus areas are listed below.
Some people may be concerned about plumbing in a home they are looking to buy or sell. In this case, an experienced and qualified building inspector will look at things like water pressure, watering systems, gas fitting, waterproofing, taps, spouts, mixers, gutters, downpipes, valleys, bidets, baths, showers, pipes and leaks.
A timber pest inspection looks for things like termites, carpenter ants, borers and decay on a property. These pests are often looked for first, especially termites, since they are quite prolific in many warmer areas of Australia.
Be sure to speak to your inspector about more unusual concerns such as snakes, possums, or spiders.
Specialised building inspectors can look for asbestos in older Australian homes, especially those built before 1980 when domestic building use was discontinued. If asbestos is suspected, it will often require laboratory tests to confirm their suspicions. As Asbestos was banned outright in 2003 and checked heavily in older homes, asbestos checks are usually not included in a standard building inspection report.
Swimming pool inspections are important due to Australia’s strict pool safety fencing rules and guidelines that have become more prominent in recent years to reduce the amount of child drowning incidences. So it’s a good idea to have a building inspector make sure that your fencing and pool set-up is compliant.
When an electrical inspection is carried out, the building inspector is looking for faults that could lead to injury, fire or death.
Electrical inspections generally:
With all of the above, it’s not at all surprising to wonder whether building inspections would become a mandatory part of the process. In a lot of situations you are forced to get a roadworthy certificate for your car, but this does not exist for the home you live in. Until that happens, owners will continue to educate themselves more on the different options they have before making a purchase.
Much of the future changes will also depend on the demands of the recent housing boom and how the law chooses to react to safety vs accessibility of the public to obtaining adequate housing, but we certainly expect that inspections will continue to become more specialised, diversified and that technology will play a huge part in how inspectors can track issues early on.