Conveyancing: final property inspection
Written by Nagisa Takaki
Before settlement, it is important to conduct a final inspection to ensure the property is the same as when the purchaser decided to make the offer. A final inspection is an important part of the purchase process.
It is highly recommended that the purchaser should conduct the final inspection as close to settlement as possible.
The purchaser arranges the inspection with the real estate agent. The purchaser is entitled to inspect the property at any reasonable time during the week before settlement.
The standard contract of sale requires the vendor to hand over the property in the same condition as when it was sold. If during the final inspection, the purchaser may find that something is damaged or not working as it was on the day the property was sold.
The purchaser has a right to receive the property in the condition it was in on the day you signed the contract, fair wear and tear excepted, so we suggest the purchaser looks out for the following:
Is everything that was in working order still in working order?
Are the goods mentioned in the contract still on the property?
Has anything been damaged other than through fair wear and tear?
Is there a substantial amount of rubbish left on the property?
Have the vendors actually vacated the property (if applicable)?
NOTE: The purchaser needs to establish that this deterioration has occurred since the time that you signed the contract.
NOTE: Clean and Tidy - Any piles of rubbish or green waste should have been removed unless these piles were included in the contract. There is no obligation for the vendor to thoroughly clean the property. The vendor does not have to steam clean the carpets. Unless expressly specified in the contract chattel including furniture and rubbish are to be removed prior to settlement.
If identify problems, then there is a couple of options:
General Condition of the contract of sale of land requires the vendor must deliver the property to the purchaser at settlement in the same condition it was in on the day of sale, except for fair wear and tear. However, this does not entitle the purchaser to make a deduction at settlement, as the condition specifically states that if any goods/chattels are not in the required condition, the purchaser may claim compensation from the vendor after settlement.
If there is minor damage, this may not give the purchaser a right to withhold settlement or withhold any funds at settlement. First, a purchaser should confirm with the lawyer/conveyancer that the damage.
General Condition provides a procedure to allow an amount up to $5,000 to be held by a stakeholder to be appointed by the parties if the property is not in the condition required. The nominated amount may be deducted from the amount due to the vendor at settlement and paid to the stakeholder, but only if he purchaser also pays an amount equal to the nominated amount to the stakeholder. It is the stakeholder’s duty to pay out in accordance with resolving the dispute.
Settlement should proceed without delay and the dispute be resolved afterwards.
A final inspection is a really important aspect of the settlement purchase of property.
This information provided this article is general advice only. Should you have any queries, please do not hesitate to contact our office.