Frustrated home-buyers have been promised relief from out-of-pocket costs as a state embarks on a major rethink of real estate due diligence.<\/p>\n
The burden of pre-sale building and pest inspections would shift from prospective buyers to sellers under legislation the Victorian Labor government plans to introduce to parliament in 2027, if it wins re-election in November.<\/p>\n
Under the proposal, sellers would be required to organise and pay for the reports before putting a property on the market and make them available to all potential buyers.<\/p>\n
Must buyers currently arrange and pay for their own inspections while competing for the same property, and costs can snowball if they miss out at auction or negotiations fall through.<\/p>\n
Premier Jacinta Allan compared the mandate to the requirement for motorists to organise a roadworthy certificate before selling their vehicle.<\/p>\n
“The same approach needs to be taken for interested buyers looking at buying a home,” she told reporters on Thursday.<\/p>\n
“Many people are having to purchase multiple building and pest inspections that can add up to thousands and thousands of dollars.”<\/p>\n
Building and pest inspection reports can cost between $500 and $600 combined, according to research from the Consumer Policy Research Centre cited by the state government.<\/p>\n
About half of all buyers pay for multiple inspections before buying a home, while one in six pay for seven or more at a cost of up to $4200, the research found.<\/p>\n
Inspections can be pivotal in purchasing decisions, with 11 per cent of buyers having decided not to place an offer after viewing a report.<\/p>\n
The government plans to consult with industry stakeholders and its counterpart in the ACT, the only Australian jurisdiction where owners are required to pay for inspections reports.<\/p>\n
Vendors in the capital territory must arrange pest and building inspection reports three months before a sale, except for certain kinds of properties including new builds.<\/p>\n
The reports must meet certain standards and vendors can recover the costs from a successful purchaser after a contract is signed.<\/p>\n
It is yet to be decided if certain buildings will be exempt from the Victorian scheme or if sellers will be reimbursed.<\/p>\n
Real Estate Institute of Victoria chief executive Toby Balazs backed the policy but suggested it must be accompanied by broader reforms to strike a balance between the interests of prospective buyers and vendors.<\/p>\n
“This means government avoiding a heavy-handed approach that places an excessive regulatory burden on vendors, while not adequately protecting their fundamental right to achieve the best possible sale price,” he said.<\/p>\n
The government has promised safeguards to prevent low-quality or biased reports.<\/p>\n
Buyers can still commission their own reports if hold concerns about conflict of interest or independence.<\/p>\n
Opposition Leader Jess Wilson said the coalition would wait for more detail before deciding whether it would support the “big promise”.<\/p>\n
“I don’t understand why the government is holding this up as a big cost-of-living relief exercise if they’re not intending to implement it for Victorians now,” she said.<\/p>\n","protected":false},"excerpt":{"rendered":"
Frustrated home-buyers have been promised relief from out-of-pocket costs as a state embarks on a major rethink of real estate due diligence. The burden of pre-sale building and pest inspections would shift from prospective buyers to sellers under legislation the Victorian Labor government plans to introduce to parliament in 2027, if it wins re-election in […]<\/p>\n