Are you buying an investment property? Or do you own an investment property?
The chances are that your investment property, or the investment property you intend to buy is in an area where termites are common. Termites are most common in mainland Australia within 100km of the coast. If your investment property or target investment property is in Tasmania then you have nothing to worry about – there are no termites in Tasmania.
Active termites or previous termite damage can alter the value of a property. Not only could you be paying too much, but it may cost you thousands having them removed and any repairs undertaken.
If you are intending to bid at auction
If you are intending to bid then you are hoping to buy. If you win the auction then the contract to buy the property is binding. If there’s a termite infestation are you didn’t get an inspection then there’s nothing you can do about it. If there’s past termite damage you could be paying too much.
It is absolutely critical to get a termite inspection before you attend the auction.
If you are buying through private treaty
Private treaty is when you buy a house through a private negotiation between yourself and the seller, usually through a real estate agent. This is the most common method in Australia.
In Queensland you generally make an offer using an REIQ Contracts for Houses and Residential Land contract. On the contract there is a section called “Special Conditions”. In this you should put “Offer subject to satisfactory pest inspection”. This allows you to not have to pay for a pest inspection until an offer is accepted. When you’re looking for an investment property you don’t often get an acceptance on the first property you make offers on. It makes sense to only pay for a pest inspection on the property that has accepted your offer. Of course if you are bidding at auction then you should get one on every property you bid on.
What do I do if there are termites?
It depends. Is it past damage? Is there a current infestation? As a general rule, if there is a current infestation then back out. Either don’t attend the auction or use the clause you put in the offer contract to back out. You may not know how extensive the damage is and how much it will cost to fix. An investment property shouldn’t be an emotional decision so there are other less risky opportunities. If there’s past damage then it’s up to you.
What if I already own an investment property? How can I protect it?
You have 3 options;
- Cross fingers and do nothing.
- We don’t recommend this. A termite inspection or termite barrier is like a car insurance policy. We’d prefer not to crash our car and have it stolen but the cost of an insurance policy covers us from a much larger potential loss. Generally people are lot less anxious about the cost of an insurance policy than not having one and having that potential financial loss hanging over their head
- Annual termite inspection
- Every year you get an inspection to check for termites. If you have an infestation then you get it treated. It’s not ideal to have a termite infestation at all, but if you do, you want to identify and treat it early. Termites can chew through someone’s house for years before they are aware. If the damage is structural then i will be very costly. Click here for more information on an Annual Termite Inspection
- Termite barrier (termite protection)
- A termite barrier is a pre-emptive barrier made around the perimeter of your home. There’s an upfront cost to install the barrier along with an annual cost to refill the treatment. It will guarantee that you do not get an infection. Click here for more information on an Termite Protection
Now that you are aware of the ins and outs of termite inspections and protection for investment properties you are in a better position to decide what your needs are. To have an obligation free discussion about your situation you can call us now, or for a no-obligation quote please click here to fill out our quote form.