Latest / That Home Loan Hub / When To Order A Builder’s Report For A Home Purchase

Transcript

When To Order A Builder’s Report For A Home Purchase · That Home Loan Hub

• 0:10
  SPEAKER_02: If you're a buyer and looking to get a builder's report, this is the episode for you.
• 0:14
  SPEAKER_02: We're going to talk about timing.
• 0:15
  SPEAKER_02: Hello, Evan.
• 0:16
  SPEAKER_00: Hi, how's it going?
• 0:17
  SPEAKER_02: Good.
• 0:18
  SPEAKER_02: At what point should people get a builder's report?
• 0:20
  SPEAKER_00: Hopefully before they go unconditional.
• 0:23
  SPEAKER_01: I hope so too.
• 0:25
  SPEAKER_01: Makes the both of us.
• 0:27
  SPEAKER_00: Yeah, I guess it depends on, you know, what the house is like.
• 0:34
  SPEAKER_00: If there's any risk areas, if you're potentially buying a lemon, or you know, there's there's so many different factors, but the sooner the better.
• 0:46
  SPEAKER_00: Even if you engage us or any building inspector, I'm not, you know, you don't have to get a building inspection with me, just please get a building inspection.
• 0:57
  SPEAKER_00: It doesn't matter when it happens, but the earlier the better, because once you get the builder's report and you talk through you talk through the report with the person that has done the inspection you get a good understanding of what you're buying.
• 1:15
  SPEAKER_00: If there's issues that come up in the report that gives you more more than enough time to negotiate.
• 1:41
  SPEAKER_00: Leaving it late gives you less time to think about what's going on.
• 1:50
  SPEAKER_00: Yeah, I guess at the end of the day, then you're under pressure.
• 1:54
  SPEAKER_02: Yep.
• 1:55
  SPEAKER_02: And when people are under pressure, they don't make really good decisions, I find.
• 1:59
  SPEAKER_02: Because the brain just shuts off that logical brain that you have.
• 2:03
  SPEAKER_00: That's the hard part with buying a house, because buying a house should be a logical decision, and people put emotion into it far too much, and usually emotion wins out.
• 2:16
  SPEAKER_00: Obviously, you have to like the house that you live in, otherwise you're probably gonna have a bit of a miserable time.
• 2:23
  SPEAKER_00: But if you, for instance, over-offer because you love the house, and then all of a sudden there's a whole bunch of maintenance issues, or maybe the house is fine, but the long-term maintenance is gonna cost quite a bit.
• 2:38
  SPEAKER_00: EG two-story houses.
• 2:41
  SPEAKER_00: And all of a sudden you're you're stressed financially because you know, maybe you did offer too much.
• 2:47
  SPEAKER_02: And and we see that, right?
• 2:48
  SPEAKER_02: Like we see a lot of those posts on Facebook at the moment where people going, I can't afford my mortgage anymore, and I bought a house at the peak, and you know, I made this emotional decision.
• 2:57
  SPEAKER_02: And if I'm selling now, I'm selling at a loss.
• 2:59
  SPEAKER_02: Yeah.
• 3:00
  SPEAKER_02: But I can't just carry on.
• 3:01
  SPEAKER_02: So yeah, so there are a lot of people that are stressed.
• 3:04
  SPEAKER_02: What we normally encourage people to do is once their offer is accepted, that's when you go and get the reports done.
• 3:10
  SPEAKER_02: Because a lot of people under it's sort of a chicken and egg for some people because they think, oh, maybe I should get the builder's report first and then put an offer, if I want to put an offer.
• 3:22
  SPEAKER_00: Yeah.
• 3:23
  SPEAKER_02: But and correct me if I'm wrong, but my logic was that process is you put an offer you go and spend money on builder's report, and then you want to put an offer, but they may not accept your offer.
• 3:34
  SPEAKER_02: So you've just spent money for nothing.
• 3:37
  SPEAKER_00: Yeah, I I agree with that.
• 3:39
  SPEAKER_00: However, I've also seen where people have got builders' reports done prior to an offer, but then they're not wasting money on lawyers.
• 3:48
  SPEAKER_00: That's because I mean, lawyers are going to be more expensive than me.
• 3:51
  SPEAKER_00: So if they're if they like the house but they're unsure whether or not there is you know long-term maintenance or anything like that, getting a report for 700 bucks is usually cheaper than you know, fifteen hundred, two thousand dollars for a lawyer, and then you have to still get a builder's report.
• 4:09
  SPEAKER_00: So in the long run, it may save you money, but you don't see that very often.
• 4:14
  SPEAKER_00: It's it's usually after the offer has been made.
• 4:17
  SPEAKER_00: Yeah.
• 4:17
  SPEAKER_00: I mean, I've got I think about three inspections next week.
• 4:21
  SPEAKER_00: That's just TBC to my calendar because they're either putting an offer in either today or yesterday, and they're just waiting for confirmation that it's been accepted, and then we'll organize access with the agent and then we'll go in and and that secures their inspection.
• 4:38
  SPEAKER_02: And that's my next question to you as well, because a lot of the time clients are confused at what happens.
• 4:42
  SPEAKER_02: So they contact you, they book a building report, and then do you contact the agent?
• 4:47
  SPEAKER_02: Yeah.
• 4:47
  SPEAKER_02: How do you organize the visit?
• 4:48
  SPEAKER_02: Do you want to talk a little bit about that?
• 4:50
  SPEAKER_00: So yeah, we get we get engaged, they want a builder's report, whether it's a pre-sale, pre-purchase, maintenance, whatever inspection they want.
• 4:59
  SPEAKER_00: And then if it's a pre-purchase, then I'll message or call the agent for access, and then we'll organise a time that suits their condition period.
• 5:11
  SPEAKER_00: So if they've got a 10-day clause, building building report clause, then that gives me more than enough time to get to the property.
• 5:22
  SPEAKER_00: Uh, I think one of my ones, I think my one on Monday, there they put an offer in yesterday, hasn't been accepted yet, but that will give me until next Wednesday.
• 5:33
  SPEAKER_00: So I'm booked up for the rest of the week.
• 5:35
  SPEAKER_00: This week, but I've booked penciled them in for Monday, and then I'll either get out to them Monday night or Tuesday morning, and then that should hopefully give them a day or two to really like think about what's in the report, if there is anything.
• 5:50
  SPEAKER_00: It's a pretty new build, so I'd be surprised.
• 5:53
  SPEAKER_02: A bit of a controversial question here for you is do the agents get a copy of the report?
• 5:59
  SPEAKER_00: Unless the so pre-sale, typically, yeah.
• 6:05
  SPEAKER_00: I know some agents don't want to see the report because then they can claim ignorance.
• 6:11
  SPEAKER_00: I don't know, I haven't seen a bills report.
• 6:13
  SPEAKER_00: When it's a pre-purchase, if there are any issues, then my clients can take out excerpts out of the report.
• 6:21
  SPEAKER_00: Usually it's like a summary page, and then if there are issues, they'll go down and take out the specific pages that they want to address.
• 6:30
  SPEAKER_00: And that will come down to you know, if they want a price reduction or the vendor to fix it or whatever.
• 6:38
  SPEAKER_00: So yeah, they agents will see partial reports of ours, typically.
• 6:45
  SPEAKER_00: Uh it's it's few and far between that they'll see the entire report unless you know it gets shared with them in its entirety, but yeah.
• 6:56
  SPEAKER_00: Terms and conditions, they shouldn't really be doing that.
• 6:58
  SPEAKER_00: Okay.
• 6:59
  SPEAKER_00: I mean, we're not hiding anything, it's just that's just part of it.
• 7:03
  SPEAKER_00: Because if the agent, and this is not happened to me personally, but it's happened to people in the industry.
• 7:11
  SPEAKER_00: Yeah, where an agent has received the builder's report, and then they've passed so it was a pre-purchase, the agent got it and then started passing it on to other buyers, and then the other buyers have called us up asking us questions.
• 7:26
  SPEAKER_00: I'm like, Who are you?
• 7:28
  SPEAKER_00: How did how'd you get the report?
• 7:29
  SPEAKER_00: Oh, the agent gave it to us, and it's like, excuse me?
• 7:32
  SPEAKER_00: Yeah, no, then they're not meant to.
• 7:36
  SPEAKER_00: Yeah.
• 7:37
  SPEAKER_00: Sorry, I can't answer any of your questions because you know, client confidentiality and and you aren't a client of ours.
• 7:45
  SPEAKER_00: Yeah, yeah, it does get a little bit tricky sometimes.
• 7:48
  SPEAKER_02: Because often clients would ring me and they go, We've done the report.
• 7:51
  SPEAKER_02: Do we need to give it to the agent?
• 7:53
  SPEAKER_02: The agent is asking us for it.
• 7:55
  SPEAKER_00: Yeah.
• 7:56
  SPEAKER_02: Which I don't know.
• 7:57
  SPEAKER_02: To me, sometimes it can be cheeky because then it gives the power to the agents a little bit as well, before the clients have the chance to go back to the lawyers and negotiate with their lawyers.
• 8:07
  SPEAKER_00: Yeah.
• 8:08
  SPEAKER_00: I mean, the best the best way to do it is just to keep the real estate agent out of it entirely, and you can absolutely share the entire report with your lawyer, and then the lawyer can choose what to share with the other person's lawyer.
• 8:25
  SPEAKER_00: And so you've got professionals working together, knowing what they're talking about, and they don't have to share the entire report with the other lawyer, but they can share what matters.
• 8:36
  SPEAKER_00: Yes.
• 8:36
  SPEAKER_00: To try and get the sale over the line.
• 8:38
  SPEAKER_02: Yeah.
• 8:39
  SPEAKER_00: Exactly.
• 8:40
  SPEAKER_02: Now awesome.
• 8:40
  SPEAKER_02: Thank you so much, Evan.
• 8:41
  SPEAKER_02: Anything else to add?
• 8:42
  SPEAKER_00: No.
• 8:43
  SPEAKER_02: No.
• 8:43
  SPEAKER_02: So remember, guys, if you are looking to buy a house, there are two courses of actions.
• 8:48
  SPEAKER_02: You can either get the report before you put an offer or you can put an offer first and then go for the reports.
• 8:54
  SPEAKER_02: Thank you.
• 8:54
  SPEAKER_00: Cheers.