How can I find out about unapproved alterations or additions?
This is a common question asked by purchasers and in reality not such an easy one to answer. The real estate agent should inform you of any information relating to additions and alterations that have been provided to them by the vendor.
Even if any alterations have been disclosed to you it is still important to check if they have been approved by council. Many properties will have had some form of renovation done such as a pergola, shed, verandah, swimming pool, or other building projects. It is a requirement to have the appropriate approval from council before constructing any of these. Most building approvals will show up in the council search that is usually provided with the Form 1 or acquired by your conveyancer as part of the settlement process.
What if there is no approval noted in the council search?
It is quite common to find that the council search does not show the approval for the addition or alteration that you know has been done by the vendor. If this is known and has been disclosed to you prior to signing the contract then it would be wise to have the vendor obtain the appropriate approvals prior to settlement. Your conveyancer can recommend an appropriate clause to put in the contract to suit this. If it is discovered after the contract has been signed then it may mean you will be need to renegotiate with the vendor as once the property has settled the risk will be all yours.
However often the vendor does not know whether the approvals were obtained as the addition was already there when they bought the property. To protect yourself as a purchaser enquiries can be made at the council to find out if they have any records of the approvals. In some cases the council have records about approvals but because all the conditions have been satisfied, they have not included the information in their search. In other cases the approval may have been too long ago and the council records are lost or no longer available and of course there is also the possibility that the construction may not ever have been approved at all.
A swimming pool also needs to be compliant and this can be checked by a swimming pool inspector prior to settlement and a certificate can be provided by the vendor for this if required. It is in your best interests to make sure that this requirement is noted as a special condition in the contract.
A building inspection should also pick up whether any alterations or additions have been constructed to an appropriate standard. If this is done during the cooling off period then you can always cool off and not go ahead with the purchase or you could also renegotiate the purchase price to compensate for this. Just remember once settled anything not right or unapproved is your risk and problem!
To protect your interest as a buyer where you do not know whether the construction was or was not approved you can take out insurance called Title Insurance which will cover this type of situation. Title Insurance is available for both unknown risks or known risks and covers other items such as boundary disputes, illegal or incorrectly built structures, fraud and other items. You can discuss this insurance with your conveyancer who can arrange for cover to be taken out if you wish. The insurance fee is a once off fee and will safeguard you for the lifetime of you owning the property.
Remember it is in your best interest to consult a conveyancer before you sign or at least in the cooling off period. That way any issues you are concerned about can be discussed and a contract can be amended or withdrawn during the cooling off period.Back