Buying a house is the biggest financial commitment that most of us will make. And we all know that things can go wrong. Leaky homes, earthquake damage – we all feel sorry for owners who find their dream home isn’t as much of a dream as they thought.
The truth is, there’s a lot going on when we’re trying to buy, particularly when it’s a seller’s market and there’s a massive focus on tenders. Buyers can feel that it’s not worth paying money for builders’ reports, LIM reports and legal advice before they even know the house is theirs. It can get expensive. You might end up paying about $1,000 on each property you try to buy. Is this good value when you might miss out on the house? It’s pretty tempting to put that money into the offer instead, to have a better chance of getting the property.
Take a minute to think of it from the other side, though.
Suppose your offer’s accepted and the house is suddenly yours. That $1,000 of pre-purchase advice is only 0.25% of the value of a $400,000 home, and only 0.14% of the value of a $700,000 home. Now suppose that home has defects that would have shown up on a builder’s report, or problems that a lawyer would pick up from documents like the title, the contract or the LIM report.
How much more is that going to cost you? You’ve lost the opportunity to walk away from the deal, or to put conditions into the contract to protect yourself. As it is there’s never a guarantee that all the problems will be visible or that the documents will tell the true story – but many issues do show up. We’ve had many clients who have taken one look at what we’ve found and gratefully walked away from buying a house that would have cost them misery, money and stress if they’d gone through with the purchase. Others decide to go ahead, but are able to negotiate better conditions, or at least weigh up the problems against the advantages in an informed way.
If you haven’t got pre-purchase advice you’re essentially gambling that there’s nothing wrong. Some people win that bet. Many don’t.
That’s why we believe that pre-purchase checks are incredibly important and you should never avoid them. Any problem that your builder or lawyer raises with you is one you’ll want to know about, and you’d be unwise to buy without having had that check done. So make the phone calls, get the advice and pay the money to give yourself better peace of mind.
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