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Understanding your rights under the Building and Pest condition

House Examiner

Understanding your rights under the Building and Pest condition


Before purchasing a new home or investment property we strongly recommended that buyers undertake building and pest inspections to ensure that there are no costly hidden problems with a property.

In Queensland it is standard for contracts of sale to include a building and pest condition. This allows buyers to engage qualified building and pest inspectors to attend the property and provide written reports.

Buyers must decide whether they are satisfied with the reports and provide notice to the seller by 5:00pm on building and pest inspection date.  If the buyer is not satisfied with the reports obtained they may have the option to terminate the contract.

It is crucial that both parties are mindful of this deadline. The seller will also have the right to terminate the contract if the buyer has not given notice on time under this condition.

So what should you do if you are concerned about the results of the inspection reports?

The reports should reveal any potential issues with the property, which may range from small defects to major structural issues. If you have concerns about the property it is best to discuss these with your building inspector first and then consult your solicitor.

Buyers should be aware that sellers are not obliged to fix all issues raised by the building or pest inspector and not every issue will automatically give buyers a right to terminate the contract.

In order to terminate under the building and pest condition buyers must act reasonably. Whether or not it is reasonable to terminate the contract will depend on a variety of factors, such as the age of the property and if the issue was obvious when the contract price was negotiated. Major structural issues or severe termite infestation are examples where it would be reasonable to terminate.

If you do not wish to terminate the contract, the building and pest reports can be a useful tool to negotiate with the seller for a reduced purchase price or to ask for defects to be remedied prior to settlement.  Any negotiations with the seller must be agreed in writing before the building and pest condition expires.

Here are some simple tips to ensure that you get the best outcome under the building and pest condition:

  1. Make sure that you arrange the inspections well before the due date to allow time for the inspector to prepare the reports as well as time for any negotiations to take place.
  2. Be present at the property while the inspections are carried out. This way the inspector can point out any potential issues and provide you with more background information than what will be included in the report.
  3. Keep your solicitor informed and provide plenty of notice if you wish them to undertake negotiations with the seller on your behalf. This ensures that you do not miss any deadlines.

For more information please contact the friendly team at Just Us Lawyers on 07 3369 7145.

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