Property Inspections Will Save You Money When Investing In Real Estate
For many thinking of taking control of their financial future, real estate investing is a great means to move ahead, build wealth and be successful. To be successful with property investing, however, one really should invest in their property investing education. Having the knowledge behind you will indeed put you at an advantage going into any area of the real estate investing process.
It's not enough, however, to build on your own education and trust that you know enough about every property deal to make it a successful deal. In order to make sure each property is a winner, you must apply your knowledge by thoroughly researching the property and the transaction before proceeding. One way to help you gain a good knowledge of a property and any inherent risk in the transaction is to ensure that you obtain professional property inspections prior to purchasing a property.
Many companies offer services to inspect your potential property purchase before you lay out any money toward the property. In fact it is advisable to include clauses related to the satisfactory outcome of a property inspection in the initial contract of sale.
There are several types of inspections and reports that you may wish to consider. Each has a cost associated, however, the amount of money they can save you make then certainly worth your consideration.
Building inspection – a thorough inspection and report of all building faults / defects or potential areas for concern.
Pest inspection – an inspection and report indicating any evidence of current or past insect activity within a home or surrounding.
Property valuation – a formal report indicating the value of the property. This report will help you determine whether the price you are paying for the property is fair and reasonable in the current market circumstances.
Body corporate report – report indicative the status of the body corporate finances and indications of any works planned. This will help you assess if there are likely to be any unexpected costs soon after purchase.
As stated earlier in this article it is advisable to include clauses related to the satisfactory outcome of your property inspections in the initial contract of sale. Beware with the wording of clauses provided by real estate agents as these will often not be in your favor. For example many real estate agents provide a contract clause related to a building inspection that states word to the effect of 'no major faults or defects' found. A better case would state the inspection should be 'to the satisfaction of the purchaser'. It is advisable to consult your legal representation to ensure your best interests are being looked after here!
So once you have your inspections completed, what next? Well, the outcomes will provide you with valuable information on which you can make one of three decisions:
– Proceed with the sale as planned
– Do not proceed with the sale
– Use any negative or potentially expensive options to negotiate on purchase price.
So when you're serious about a property, make sure you get the right people to inspect it and use the data obtained to your advantage. Property inspections will give you peace of mind and save you money.