Should I sign a Standard contract to buy a property without first seeking advice from my Solicitor?
Definately not! A competent Solicitor is likely to make some alerations and add inclusions to a contract to ensure you have the right to proceed with a property purchase or not. Based on your needs which may allow you alone to be satisfied with the results of a building inspection report. Not give the decision making to the sellers Solicitor.
What should you know about a Standard contract.
- No clauses to protect you against illegal structures that have been built without Council approval. Illegal structures are not likely to be covered by your insurer in the event of a claim, once you own a property or possibly in the interim.
- Includes a provision that allows the seller to obtain a “full” copy of a report, that the buyer pays for, at no cost to the seller. This may allow the sellers Solicitor to dispute outcome of the report.
- Often stipulates that the buyer must “act reasonably” when making the decision whether to buy or not. This can be open for agument.
- Allows a cooling off period of 5 days at a penalty cost to the buyer.
This is why it is so important to seek the advice from an independent competent Solicitor/lawyer before you sign any contract.
Be warned about the inclusion of “Structural Soundness” in a property purchase contract!
Do not under any circumstance sign a contract that says to the “structural soundness” even if it says to your satisfaction. This clause is sometimes used to limit your chances of renegotiating or terminating a contract unless the building is falling to pieces before your eyes. A building can be deemed structurally sound yet still require a considerable amount of money for rectification of non-structural items. There is a far greater list and expense of non-structural items in a building than that of a structural nature.
A clause that will not allow you to terminate a contract even if the building has extensive termite damage!
Never sign a contract that includes a clause that stipulates the conclusion of the pest inspection to be “current infestation” this will not protect and cover you against past and extensive damage to the building!
Should I allow a contract clause that allows the seller the option of rectifying faults?
Definately not! Sellers will look for the cheapest option are highly unlikely to have items/faults rectified or replaced that would be to an acceptable standard to your satisfaction. They would repair or patch-up to achieve the sale, then when you own the house and things fall apart, they become yours to fix at your expense. Never let this happen to you!
Should I allow the agent to determine their nominated inspector on the contract?
Do not be bullied by anyone into using a building or pest control inspector they recommend also out of using someone of your choice. Agents often recommend inspectors that will give biased reports written in their favour to achieve a sale. Be realistic and consider this: if a sale falls through due to report results of inspectors, the agents recommend, do you honestly think the inspectors are going to receive future referrals from that agent, HIGHLY UNLIKELY!
Is it advisable to have my inspections carried out before signing a contract to buy?
It is preferable to obtain inspections before signing a contract so you know the true condition of the property before putting a price on it. Otherwise you are signing and agreeing to a price on something you know very little about!