Pre-offer property inspection as part of the house buying process gives clarity to proceed for making an offer, selecting the right due diligence clause and starting offer. For doing so you must not be an expert, take the summary as guideline.
House Buying Process
Pre-offer Property Inspection
Pre-offer Property Inspection—your chance
When choosing a property to purchase the asking price can be misguiding. By taking a broader view the asking price does not necessarily reflect the market value. However market prices are largely hinged on the supply and demand and might not appear as value for money.
For the willing buyer is the “sentimental value” the starting point for making an offer. Again, the sentimental value differs for the same property when purchased as investment property. Instead of buyer’s sentiment investments are evaluated by the potential to produce income (ROI - return on investment).
For these reasons pre-offer viewings (inspections) are important to find “the price” that matches the scope, the numbers and for entering the negotiations with the seller. It is similar when setting a price/threshold for an action. If you stick to your numbers you have to be prepared to let it go or take the risk getting “low value for money”.
What to check when viewing a property?
Everybody can do that. You need to make an appointment with the agent, a ladder, torch and your check list. Having a closer look at the house gives you some ideas how far you possibly would negotiate.
It is not a building inspection. It is just for you getting an impression about the general state of repair and maintenance, what is attached to the house and needs to be further investigated if the vendor accepts your offer (planning the due diligence).
Floors, Walls and Ceilings
I use to roll a little marble to check the floor is leveled. A slant floor indicates problems with the house foundation, piling or ground movements. Rotten timber and borer holes are serious damage that could point in direction moisture damage, leaks or condensation. Be suspicious about fresh painted walls and ceilings that might cover-up moisture damage, mould or cracks.
Doors and windows
Check do they open without sticking, that handles and locks work (and have keys). Sticking or crooked windows and doors can mean the house is moving. Check woodwork for rotten timber and borer. Especially check rubber seals on aluminium windows are not perished and joining timber is not rotten.
Smell, day light and ventilation
Entering a house that is smelly lacks of natural light and air-flow will tell you about healthy living conditions.
Electrical fittings, power points, switches
Are fittings, switches and sockets in a state of good repair? Are there enough power points and lights in each room? What is the condition of switchboard, fuses and cabling?
Wood-burner with black stains mean it is not working well. Check out local regulations regarding emissions control and restrictions. Is the chimney old or cracked?
Ask yourself, what will your future heating be such as central heat-pump, gas-heating, under-floor heating etc and what will it costs you to run.
Check the hot water pressure, taps and fittings. Look for water marks in kitchen, laundry and bath.
Depending on the number of people in your household is there plenty of hot water? Check the size of the hot water cylinder (for more than 2 people it should be larger than 135L).
Chattels and appliances
Note everything that is attached to the house like carpets, light fittings, heaters and appliances.
Roof and roof cavity
Check the roof for rust, holes, cracked tiles, signs of leaks and attachments like SKY TV dish. Get a glimpse of the roof cavity— smell, insulation, signs of water damage?
Droppings from pests tell you more than you want to know!
Spouting/gutters and flashings
What are the conditions of pipes and gutters? Are all doors and windows flashed and sealed to prevent leaking? Check storm water drains.
A place becomes your home and traffic noise, trains, planes, neighbors, etc will affect your life. Nearby main roads, railway, local businesses, waterways, landfill and so on can impact the value of your property.
After your pre-offer inspection you will be able to customize your DD Check List, plan your next move if you want to become the owner of that property and finalize your starting offer.
Next Step — Paperwork, how to prepare your starting offer?
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