To pest inspection...or to not pest inspection?

When you've finally found a property which ticks all your boxes and it comes to crafting your offer to secure your new home, the question arises...should you include a clause for your offer to be subject to a building and pest inspection?

The truth is this is ultimately your choice as a buyer what conditions you include in your offer.

Making your offer subject to a building and pest inspection means that if an issue is identified with your possible new home when these inspections are completed, you as the buyer have a right to walk away from the contract.

If you don't include this clause and it turns out that there is a fundamental structural or pest issue with the property you are purchasing, there is little recourse for you.

So ultimately this clause protects the buyer in case of there being a building or pest issue allowing you to exit the contract without penalty (providing these are completed within the timeframes agreed to in the contract).

However, buyers who are competing for a property sometimes feel that the inclusion of such clauses could make their offer 'less attractive' than that of other buyers who choose not to include them.

From a seller and real estate agent's point of view, the fewer the conditions on the offer, the more likely the sale will go ahead. So you could understand why some sellers may choose the offer in it's entirety, not just the price offered.

So what should you do if you want to put your best foot forward to have your offer accepted without exposing yourself to a potential big problem?

Some buyers for properties they are seriously interested in choose to do a building and pest inspection prior to making the offer. This can be somewhat challenging as access to complete this inspection needs to be agreed to by the seller and agent. It can also be an expensive path if a home buyer makes a number of ultimately unsuccessful offers over time.

Other buyers try to craft the best offer in it's entirety by focussing on other features of their offer, other than price, which may include proposed settlement timeframe. Some sellers may preference one offer over another if the settlement timeframe is more appropriate for them.

Having your preapproval fully assessed when negotiating on a property can work in your favour. If a seller has one offer where the prospective buyer is yet to have their finance preapproved vs another buyer who has already been assessed, it can also influence which offer is successful.

Regardless of how you choose to approach your offer, what it does take is negotiation with the real estate agent. This can be a daunting prospect regardless of whether you are a first home buyer or have purchased before. It is important to try to gauge what the circumstances of the seller are and what settlement timeframe may be most attractive to them. It is also important to ensure you are considering making an offer at a realistic price that the seller might consider.

From a bank point of view, whether you choose to have a building or pest inspection does not impact upon they way they finalise your loan application. The bank just needs to receive the contract with your intention that you wish to go ahead.

This decision can only come after you have completed the building and pest inspection if you have included it in your accepted offer.

Seek the guidance of your mortgage broker in crafting your offer to best protect you from a bank point of view. The building an pest inspection is only one part of the equation.

And ultimately it will come down to your choice.