A seller’s guide to building and pest inspections - The Community Leader and Real Estate New and Views
Real Estate


Traditionally, building and pest inspections in Queensland have been commissioned by the buyer once a contract is entered into with a seller. 

However, as consumer expectations change and people become increasingly busy in a fast moving and competitive property market, we are seeing more sellers commissioning a building and pest inspection report at the time of listing. This is especially true when it comes to sellers who choose to sell their property via auction – an increasing popular method of sale in Queensland, but one that many buyers are relatively cautious about.

So why would a seller pay for a report that the buyer should pay for? It’s a good idea for three reasons.

Firstly, a building and inspection report means that a seller has an opportunity to address any issues raised in the report before listing the property. A seller may choose to address and rectify some problems before putting their property on the market. The report may also be useful when it comes to price negotiation. Buyers will often use issues raised in the building and pest report to try to negotiate the price down, arguing they will have to pay to have those issues addressed and so they want a discount on the sale price. If you’ve taken those bargaining chips off the table, you’re potentially ahead of the game.

And secondly, it conveys transparency and helps potential buyers have a level of confidence that they can trust the seller and get to know more about the property through the eyes of a third-party professional. It is particularly useful if the property is going to auction and buyers arrive on auction day without having done their due diligence – it is an opportunity to give buyers some insight into the state and condition of the property and identify any flaws or issues that the building may have in a written report format. Without this, some buyers may choose not to bid and may miss out on the property.

Lastly, a seller commissioned report may save buyers time and money. The cost of commissioning their own report can be a barrier for buyers when they need spend money on a report without knowing for sure if they will in fact be the successful buyer. It also helps take the time pressure off, when people are living busy lives and building and pest inspectors are in high demand in an increasingly rapid and competitive market where turnaround times are generally short in order to be competitive.

Although seller commissioned reports are becoming increasingly more common and can be beneficial for the reasons stated above, it is important for buyers to understand some potential risks and legal limits which may apply. If a report has been commissioned by a seller, the rules of contract law and privity apply. Generally, this means the buyer, who is not a party to that building and pest inspection contract, cannot directly rely on the report and seek compensation from the inspector for any damage or loss they may suffer if the report is defective. In some cases, to overcome this issue, inspectors may allow a buyer to pay an additional fee for the seller’s report and this ‘transfers’ the report and contractual rights to the buyer.

Buyers should understand the potential limits that come with relying on seller’s reports. In some cases, buyers may find it beneficial to review the seller commissioned report but still opt to undertake their own independent report.