Markets Steam Ahead| Bendigo Gem | Dealing with Pest & Building Issues
Welcome to the October 2019 edition of the Adviseable newsletter!
The renewed positivity and optimism around residential real estate continues to roll throughout the country, and with this week’s RBA rate cut the outlook is looking even better still.
This momentum in the marketplace is creating some excellent buying conditions and emerging opportunities. To find out more about what we’re seeing day to day as we buy properties for our clients throughout the country, give us a call or come along to our next Property Investor Meeting (details towards the bottom of this newsletter).
On the topic of where to buy, some months back we’d picked South-West Sydney as one of the growth markets to keep an eye on. With all of the doom and gloom about the “Sydney property market” from the media at the time, it seemed that some investors weren’t quite ready to consider buying in Sydney just yet. Now that sentiment has flipped, we thought that this video showcasing our findings on South-West Sydney was worth revisiting:
Recently Purchased by Adviseable: 3 Saville Court North Bendigo VIC
Bendigo continues to be a popular option for our buyers and this property is a prime example of why it represents such excellent value. Purchased off-market for $392,500, this home is nestled in a highly sought after pocket of northern Bendigo within walking distance to local schools. The immaculate steel-frame brick home has 4 bedrooms, 2 bathrooms, and a double lock-up garage. With sitting tenants paying $380 per week – What more could one ask for!?
Bendigo VIC highlights:
- Victoria’s 3rd largest city & concentrated economic base
- 130km north-west of Melbourne
- Recently completed $5 billion Regional Rail Link project
- $630 million Bendigo Hospital re-development project
- Population expected to near double by 2055
- 1.7% vacancy rate (North Bendigo)
Question of the month:
Q: I’m in the process of buying a property and the pest & building inspection has revealed a few issues. What can I do to get the seller to fix them?
A: Firstly, I’m going to assume that the issues identified during the inspection are not show-stoppers such as major structural defects, a live pest infestation, or severe water penetration caused by leaking internal plumbing. However if the issues are relatively minor and not deal-breakers, I would suggest the following game plan as recourse:
1. It’s essential to understand your rights and options as a buyer as they vary in each state. Compare buying a property in NSW to VIC or QLD for example and the default stipulations around pest & building will be quite different in all three cases. So too is the timing of when to get the inspection done. And when buying at auction, or in a hot market whereby you’re expected to waive your cooling-off, the timing for inspection will be different still and your ability for recourse could potentially be non-existent.
2. When it’s an option to do so, outline your preferred terms & conditions around pest & building due-diligence during initial negotiations. Any agreement should be firmed up by inserting carefully worded “special conditions” into the contract. Your solicitor or conveyancer can help with this.
3. In the event that an issue is identified during the pest & building inspection, get a quote from a reputable professional to have the problem area fixed. This will enable you to negotiate with the seller and their agent from a well-informed position and counter any rebuttal with tangible figures and reasoning. Whilst your pest & building inspector may be able to provide ballpark figures for the repair works, your best bet here is to consult with specialist trades.
4. Admittedly as a buyer’s agent it’s my natural inclination to push my luck at every step. That said, I do believe it’s important to consider the overall ‘spirit’ of any deal when asking for something. So before putting forward your case to request that the seller fixes a bunch of issues, assess whether the full extent of this request is likely to exhaust ‘credit’ with the seller if leeway is to be required at a later date (i.e. an extension to settlement without penalty, or extraordinary access to the property prior to handover for example).
5. Ensure that any remedy works agreed upon are formalised through the appropriate legal channels. Having your solicitor or conveyancer set out the arrangement in writing ensures that nothing is conveniently overlooked or forgotten once you’re past the point of no return with the contract and you’re no longer in a position of leverage.
6. Stipulate that any remedy works paid for by the seller are to be carried out by a licensed tradesperson with receipts supplied for works completed. This not only ensures that the work will be done to an acceptable standard, but it also provides indemnity of the work should something go awry after settlement. This stipulation may sound like stating the obvious, but you’d be surprised at how common it is for sellers to try and get away with doing works themselves to save a few bucks! – Alex
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