When purchasing or selling a house, obtaining a builder’s report is very important. Whilst not required by law, the failure to get the building inspected prior to purchase can lead to significant headaches down the line.

What is a builders report?

A builder’s report is the result of an inspection of a property, conducted by a suitably qualified builder, that will highlight the condition of the property. Usually a builder’s report will contain a visual inspection of the property, maintenance recommendations, moisture tests, as well as a summary that provides an idea of the condition of the property as a whole.

Why should you get a builder’s report?

From the perspective of an individual selling a property, obtaining an independent builder’s report is important for a number of reasons.

Firstly, it gives any prospective buyers confidence the seller of the property is not trying to hide any defects or major structural flaws that will prevent purchasers from wanting to buy the property.

A builder’s report also has the effect of answering many of the questions that prospective buyers may have. Instead of directly receiving numerous questions regarding different aspects of the property, buyers can simply refer to the builder’s report. This will shorten the sale process, and reduce unnecessary administration for sellers.

From a buyer’s perspective, obtaining a builder’s report is arguably even more important.

Knowing the ins and outs of a property prior to purchase will inform the purchaser of the condition of the property, as well as any major defects that may need to be addressed after the purchase of the property. This will allow a purchaser to try to negotiate a price that more accurately reflects the condition of the property, and probably prevent a purchaser from buying a property with major defects.

Legally speaking, what does a builder’s report do?

Many purchasers enter into purchases of property that are conditional on getting a builder’s report completed. If this is the case, the purchaser is protected from the discovery of major defects, as upon receiving such news, the purchaser can cancel the purchase contract.

If a defect is discovered shortly after the purchase of the property but was not picked up by the builder’s report, there may be remedies available against the builder who conducted the report.

If the vendors do not obtain and provide a builder’s report prior to the house being purchased, pursuing the vendor to pay for any repairs is difficult as the purchaser did not do their due diligence. As a result of this, any unforeseen damage or maintenance required may be solely up to the purchaser to fix.

If there is confusion around the rights of buyers and sellers of property, it pays to seek advice from a professional with experience in the area.

 

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.

Alan Knowsley & Matthew Binnie

Litigation team
Wellington