Building Inspections - A new way?

[Big Will]

An oppurtunity came across today which i had thought about previously regarding building reports.

Instead of getting a building inspection done at say $400 per report/per house.

Would anyone be interested in buying a report on a property that had been already been done by an independant building inspector (a franchise group), at a discounted rate of $200 per report... This sounds a little confusing however let me give an example.

E.g. The building inspector would come through for free to the vendor and do a report, this could then be on sold to any buyers should they want it for a discounted rate of $200 per report. Also allowing the vendor a chance to fix up any issues (major or minor) with one free reassesment.

This would have a risk that it would require 2 people to buy the building report to make it back to $400, however the work would be already done and if 5 people wanted the report the inspector would make $1,000 instead of $400 if he was only chosen once or $800 if chosen twice (and charged full rate).

To me it would be something similar to a roadworthy/RACV inspection you get on a car before you sell it.

I can see a huge advantage in the auction properties, it may not be as successful in private sales.

What are your thoughts?

 

[tobe]

You would have to address the bias buyers might assume looking at a report commissioned by the vendor. if you could overcome that, it might be a good idea.

 

[Big Will]

Yeah I agree, but if the vendor wasn't paying for it that would eliminate the bias, also all building inspectors have to abide by the Australian builders code (or something). As the inspector is only being paid by the purchaser so he would want to make sure he has their best interest.

The guy also gives a guarantee that if any major fault/structural fault is not reported they will pay the first $25,000.

 

[Jacque]

Hi Big Will

Already been done to a similar extent with companies like EyeOn
http://www.eyeon.com.au/about.asp?id=7

and Rentokil, who do one report for auction properties and then onsell them cheaper or provide a rebate if unsuccessful at auction.

I think multiple B/P's are an unnecessary cost to potential purchasers too, but lots of auction vendors are already providing them to interested parties to increase their chances of bidders come auction day.

 

[Rolf Latham]

Not for my clients.......

There are enough hooks lines and sinkers already with many purchases.

So much more potential lead for some wee saving isn't worth the risk.

The idea has commercial merit simply because Australians as a rule hate paying a few bob to make money, save money or indeed manage risk.....

Ta

Rolf

 

[mumbai]

I totally agree with you Rolf. Just recently I saved 8K after getting a B&P. The report had usual things like some dampness, wood rot, etc which I was already aware of. But, after I showed it to the vendor, they agreed to sell off the property to me 8K cheaper even without asking the discount on already discounted price

Prior to this as well, I got an inspection done for a property that looked great and I was ready to pay a premium. Later came to know about the numerous issues and backed out of the deal. It was a good decision.

 

[Jtkumnick]

You would have to solve:
* Percieved bias of a report commissioned by vendor.
* Risk of no income to building inspector
* Who gets sued if the end purchaser finds a problem that wasnt mentioned?
* Trying to get money out of buyers.

 

[Big Will]

Thanks all for the input being generated, i agree with what most are saying.

I am slowly working my way through this long forum post regarding the same issue a year ago people were talking about it.

http://forums.whirlpool.net.au/archive/1798738

Seems like the perception hasnt change.

 

[Jtkumnick]

People want what they want now and they want it paid by someone else.

This is where we are at in 2012.

Have fun...

 

[Logica]

....I think multiple B/P's are an unnecessary cost to potential purchasers too, but lots of auction vendors are already providing them to interested parties to increase their chances of bidders come auction day.

Hi Jacque
Agree, cost = disincentive to participate in auctions. Which means it should be in vendor's interest to provide such reports?
Legally, is there a problem for a buyer to rely on a report prepared by an accredited independent inspector even if commissioned by the vendor? Probably not???
Any lawers reading this?
Cheers,