Understanding your rights under the contract and its conditions is a standard obligation for all sellers and buyers. Unfortunately even the most standard special conditions in a contract can be easily misunderstood. One of these is the building or more specifically known as the Structural Inspection.
The industry standard, REIWA special condition annexure for Structural Inspection is used by the majority of Real Estate Agents in WA and is only designed to provide the buyer with the confidence the property they are purchasing has no structural issues that require immediate attention to avoid unsafe conditions or loss of utility.
More specifically only the structural elements of the property are covered in this clause and these include:
Walls
Roof frame
Stumps
Yep, that's it. As long as the house isn't seen to start falling down, this is all the clause covers. Now, although that may seem unfair or mostly benefiting the seller the problem exists with the ongoing maintenance required on a home that in most cases is not performed as often as it should be, or the unrealistic expectations of a buyer purchasing a house that could be 10, 20 or even 60 years old.
In most cases, the building inspector is required under the building code to provide you with not only a report on the structural elements but also maintenance report on the condition of the property. This often creates confusion as the inspector might add comments to these items which include their opinion on if the seller should fix them or not, without understanding the contract or its clause. The maintenance report on the non-structural items can be used by the buyer to help create a future maintenance plan.
Ultimately for a buyer doing away with specific special conditions and replacing them with a single 'due diligence' clause is the best way to protect themselves. This clause gives the buyer a limited time to complete any inspection and enquiry they wish and allows the buyer to walk away from the contract if they are not happy with the result of these inspections or enquiries. However, this type of clause give a lot of power to buyers and in a market where property is moving quickly, it's not something sellers are usually willing to entertain as it can stall their sale.
This information is not a substitute for legal advice. Always take instructions from your settlement agent and if further direction is required you should seek your own independent legal advice.
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