As a result of the drought, land is drying out and buildings and foundations are settling or moving. This often results in cracks and other
serious structural problems. These often first appear as only hairline cracks which do not, at first sight, seem to be serious. It is even
possible that cracks or other settlement faults may be covered by wallpaper or other furnishings or decorations.

No Warranties

Most real estate sold in Victoria is sold without any warranties or guarantees being given regarding faults in buildings on the land. Why
then do most people buy real estate without having the building properly inspected before they buy?

Building Inspection

It is not too difficult to engage a professional to inspect and report on a property before a Contract of Sale is signed or to buy subject to a purchaser receiving a report a purchaser regards as satisfactory. Generally, inspection reports can be obtained from architects, through Archicentre or other similar bodies at very short notice and for a relatively modest fee.

Most inspection reports obtained from architects on this basis are very comprehensive. If defects are discovered, a purchaser may decide
not to proceed or may even be able to negotiate a reduced price to take into account repair costs.

Given that the purchase of real estate is usually a very substantial transaction and that repair of structural defects can be very costly, the
fee paid for a professional, comprehensive defects report is sensible ‘insurance’ for a purchaser or prospective purchaser. Remember, if you only have a friend give a property the ‘once over’ for you as a favour and for free, the ‘once over’ is probably worth just what you paid for it.

Contract Conditions

In many sales it is possible to secure from a vendor agreement to make the sale subject to receipt by
a purchaser of a satisfactory architect’s report (rarely a condition included when properties are sold by
auction). When a condition of this type is sought, the purchaser should consult his or her
lawyer to make sure that the condition included is appropriate and suitable.

A purchaser should remember that an agent acts for a vendor and
therefore treats vendor’s interests as paramount. Additionally, an
agent’s skill lays in the area of selling not in the area of drafting
conditions for the protection of the interests of a purchaser.
Purchaser’s lawyers, on the other hand, make the interests
of a purchaser paramount. They have the skills in drafting
conditions to protect the interests of purchasers.

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