In today’s age of information, consumers are demanding more data and transparency when it comes to big decisions. Buying a property – whether it be that first apartment, or another investment in the portfolio, will always be a big decision. Buyers are both hungry for knowledge and also cautious to commit – opening the paper and reading a real estate horror story every other week.
As a conveyancer, you are the trusted advisor for your client and they look to you to guide them through their property purchase, ticking off all the statutory requirements and helping them to seal the deal. In other states, a Strata Inspection Report is a natural step in the process for anyone buying into a strata plan – giving transparency and peace of mind. Although not mandatory in Victoria, Owners Corporation Search Reports are gaining popularity, with more Conveyancers recommending their clients consider a report to truly know what they are buying into.
So why should you encourage your clients to complete an independent report?
- Due diligence for the purchaser (Buyer Beware)
The research carried out by leading academics and industry experts has shown that the information that is provided within your Contract of Sale (the OC Certificate included) is just not sufficient. A purchaser needs to have a thorough understanding of what has been going on within the OC and also what is upcoming in the future to give a true picture of how it is being managed.
This is the purchaser’s responsibility, but often they are not aware that they have an opportunity to find out more than what is provided with their Contract of Sale. As a result they can pass blame back onto their conveyancer at a later date when they find themselves in a position of dissatisfaction and feel they were not fully informed at the time of purchase of their options to carry out due diligence.
- Negotiate the best price
The Report gives your client the opportunity to view the good and the bad, and consider in light of this information what leverage they may have. This could potentially save them thousands, with the opportunity to negotiate a better deal based on the facts presented to them.
- Due Diligence for Your Practice
We can help mitigate the risk for conveyancers such as yourself, with an Owners Corporation Search Report being a living example that you have carried out due diligence by advising the client that they have an option and right to inspect the books and records. This is especially valuable if there is an issue found after settlement that has sizeable ramifications, and your client seeks compensation.
- Straightforward and Timely
It may appear difficult for you to obtain authority from the vendor for an inspection of the books and records to be carried out – but in fact as soon as a purchaser signs the contract of sale here in Victoria they are a purchaser and have the authority to arrange an inspection without the vendor’s assistance. This means the process is not only straightforward but also we can complete it in a timely manner – without unnecessary delays to the sale.
As an amendment to the contract of sale, your purchaser can include a special condition which has been legally approved to confirm the purchase of the property is “subject to an inspection of records”. It can be entered at the preparation stage or as an amendment at a later date if agreed by both parties. This is no different to your other amendments such as “subject to finance approval” or “subject to building inspection”.
We make it easy for you to provide your clients with an Owners Corporation Search Report, as we have seen firsthand how things can escalate without one. When things go wrong, as we know they sometimes do, having recommended that a report be carried out helps protect you from exposure and your interests as you can be confident that your clients were aware that they could obtain further information before their purchase.
We value our conveyancer partnerships and would welcome the opportunity to talk to you and support you and your firm with your client’s needs. Contact us today to talk more about your needs.