When buyers make an offer on a property, they must fill out an Offer and Acceptance form. The O&A determines all the specifics of the sale – the sale price, the parties involved, and any special conditions – so it’s important to get it right.
But not everyone does, and when a vital detail is left off, the purchase might not go as planned. Worse still, the missing detail might cost a purchaser lots of money.
Here are three essential, but often forgotten, clauses to include on the Offer and Acceptance that will help protect your interests:
1. Property Inclusions
Any item which is on the property but not actually part of it – such as a dishwasher, above-ground pool, swingset, or light fitting – is a chattel, and you need to include them on the O&A if you want them to stay with the property.
Consider this scenario: you’re inspecting a great property and are keen to make an offer. You make an offer, the seller accepts, and you proceed to settlement. Just before settlement, you realise the dishwasher you’d loved is missing! Unfortunately, that dishwasher was a chattel, so the seller was entirely within their rights to take it.
We have seen similar scenarios countless times.
The only way to ensure that chattels remain with the property is to include them as part of your purchase on the Offer and Acceptance.
2. The Correct Property Address
Including Title particulars is the only sure-fire way to ensure that everyone involved can correctly identify the property. In the past, contracts lacking Title particulars have resulted in the wrong property being transferred from the buyer and the seller – this is a complicated and expensive mistake to correct! Unfortunately, contracts with only the street address and seller’s name regularly come through our office.
You can avoid a major mix-up by including these Title particulars:
- The Lot number
- Volume and folio number
- The strata plan or number, if your property is part of strata.
Your agents will know these details and should make sure they’re included, but it doesn’t hurt to double-check.
3. Vendor Warranty
The Offer and Acceptance contracts allow for special conditions that protect the buyer’s interests – for example, a condition that the sale will only go through if the property is found to be free of termites.
One special condition that is often left off is a vendor warranty. Including a clause like:
“The Vendor warrants that all gas, electrical, and plumbing appliances, including reticulation and pool filtration equipment (if applicable) shall be in good working order at settlement.”
will give you some degree of protection against faulty appliances. Although this warranty can’t delay settlement it gives you the option to hold the owner liable for rectifying any problems that may surface.
Don’t risk a botched buying experience – ensure you protect your interests by including the relevant clauses on the Offer and Acceptance.
Pre-purchase inspections are a common, and necessary, part of the property settlement in Perth process.
They’re designed to check specific aspects of a home and show you exactly what you’re buying – very useful in uncovering nasty surprises like extensions that aren’t council approved!
Here’s 6 types of inspections buyers often choose to include on the Offer and Acceptance:
A structural inspection examines those elements of the home that might affect the structural integrity of the property. A structural report usually ignores maintenance items such as flaking paintwork and leaking gutters.
Maintenance inspections cover those items that require ongoing attention. They might include loose fittings, gutters that require replacement and paintwork that might soon require a touch-up.
These usually comment on the serviceability of the wiring, power points and light fittings. Because it’s hidden from view, faulty wiring is easy to overlook – so an electrical inspection is a wise investment.
As with electrical appliances, plumbing is often hidden and can produce some nasty surprises! Unlike wiring, though, plumbing is harder to test and detect any potential problems. That said, a qualified plumber will be able to tell you how old the plumbing is and how long you could expect it to last.
5. Comprehensive building
These reports contain observations about both structural and maintenance elements. In some cases the company providing the report will have access to qualified plumbers and electricians and therefore can include these aspects on their report. These reports are popular with homebuyers because they take less time to organise and arrange.
6. Timber pest
Each year termites cause millions of dollars worth of damage to homes across Australia. And they’re not alone in their quest to destroy! Other pests are also at work attempting to destroy foundations, roof timbers and bathroom cabinets. Most timber pest inspections today also include a visual check for termites, wood decay fungi, and wood borers.
Keep in mind that timber pest inspections can only be made on what is visible. For areas that are out of sight, such as sub-floor areas, trapdoors may need to be cut and this could be an issue with the seller.
In summary, decide which of these inspections are essential for you, and be sure to include them as special conditions on the Offer and Acceptance.
Once the Offer is accepted and settlement begins, you’ll need to have these inspections carried out by qualified professionals. When they’re done, and finance has been approved, settlement will commence in earnest!
Image by Wannaoreo via Flickr.