New property not immune from building defects
By John Dowling Australian Building Inspection Services www.abis.com.au
As the 'Australian Dream' (4 bedroom, 2 bathroom, 2 garage, 800m block) home disappears into the financial stratosphere, the high rise unit is becoming the focus of attention for many home buyers, particularly as an 'entry level' purchase.
We've noticed that some buyers are saying "we don't need a building and pest inspection because it's a solid building and besides, the apartment is on the 5th floor". Well, there is just as much need for an inspection of a high rise apartment as there is for a 'stand alone' home. In fact a buyer probably needs to exercise much more diligence because there are far more issues to consider.
In a stand-alone home, various faults and deficiencies can often be accommodated because the buyer sees high value in the land. However, similar flaws in a high rise apartment could be seen as far more significant as the component value of the land is not nearly as important and these could impact on future capital gains.
Further, a fault found in one apartment could be common to all, for example, inadequate waterproofing in the bathroom. In such a scenario the problem could be more extensive, affecting 'common property' in the high rise, leading to major repairs and impacting heavily on the building sinking fund. We have seen cases where this runs into tens of thousands of dollars.
In a recent case, the buyers rushed into the sale without an inspection. After moving in, the new owners discovered that while the view from the lounge was fantastic, the glass windows and sliding doors were deficient when it came to keeping out the road noise from the constant stream of traffic from the road below. They sold and moved on, losing $30k along the way. Don't let that happen to you.
A building inspection, viewed in conjunction with a strata search can often uncover matters of concern. On the other hand, they can confirm that the high rise apartment you're looking to buy is a sound and very worthwhile investment.
Over the next few months, we will shine the spotlight on various aspects of high rise apartment inspections. In the meantime, if you're considering buying an apartment, make sure you get a building and pest inspection and a thorough strata title search.