Bank valuations establish value in a home not its defects

News > news - 14 Feb 2008
Times are tough for many homeowners, and that makes proper home inspection even more important for homebuyers.

“Home maintenance is starting to slip as homeowners battle to pay home loan instalments that are 25% higher than 18 months ago,“ says Martin Schultheiss, CEO of the giant Homenet estate agency group.

“Consequently, homebuyers need to be especially vigilant about the condition of any property that they are thinking of buying and go back to view it as many times as necessary to inspect it thoroughly.”

The four main things to look out for, he says, are:

• Poor site drainage or clay conditions, which can cause foundations to swell or crack;
• Roof problems such as rust, loose or missing tiles, leaks and rotted timbers;
• Electrical hazards and deficiencies, including amateur wiring jobs, and old distribution boards; and
• Water leakage from interior sources such as bath / toilet surrounds or pipe-joints in the walls.

Schultheiss notes that prospective buyers should never rely on the fact that the home will be “inspected” by a bank valuator as part of the home loan application process.

“Bank valuations are performed to see whether there is sufficient value in the property to secure a home loan, and not to identify possible defects on behalf of the buyer.

“The specific purpose of a home inspection, on the other hand, is to protect the potential buyer against the high cost of repairing unforeseen or unknown problems.

“Such inspections are particularly important for elderly buyers living on fixed incomes, parents with young children, and inexperienced buyers, and they should seriously consider hiring a professional inspector to go through any home they are interested in so they can make a properly informed decision.”
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