Do I need a pest and building report when purchasing

NSW Government guidance describes a building inspection as a pre-purchase check that gives you a written account of the property’s condition, and notes that engaging a professional inspector can help you identify issues that may be costly to repair.

What a building inspection report covers

A building inspection report is typically a written account of the property’s condition. NSW Government guidance says it will include significant building defects or problems such as rising damp, movement in the walls including cracking, safety hazards, or a faulty roof.

The same guidance explains why buyers obtain one before exchange, including to know problems in advance, use the information to negotiate a lower price, and get specialist advice on major issues and how they may affect the property over time.

It also sets expectations on scope. Inspectors should check accessible parts of the property, which may include the interior and exterior, roof space, under-floor space, roof exterior, and elements of the site such as drainage, paths and driveways.

What it usually does not cover

It is just as important to understand what a standard building inspection report generally will not do.

NSW Government guidance states that a building inspection report does not deal with every aspect of the property and is focused on major problems visible at the time. It also notes that it will not generally include an estimate of repair costs, minor defects, or termite detection.

The same guidance provides examples of items a building inspector would not normally check, such as footings, concealed damp-proofing, electrical wiring, plumbing and gasfitting, air conditioning, swimming pools and equipment, and appliances.

Finally, NSW Government guidance is explicit that a building inspection report should not be used as a certificate of compliance for any law, warranty or insurance policy against future problems.

Why a pest report is still relevant

Even if you commission a building report, it does not replace a pest inspection. NSW Government guidance explains that while a building report should identify any visual damage caused by termites, it will not confirm whether termites and other timber-destroying pests are still present. It recommends getting a pest inspection as well, particularly where termites are a known problem.

The financial stakes can be meaningful. In a 2025 media release (updated July 2025), Archicentre Australia cites a 2012 industry study commissioned by the Australian Environmental Pest Managers Association (AEPMA) that estimated the average cost of treatment and repair of termite damage at around $10,000 per house, and stated that the average cost of termites to the housing industry is almost $4 billion per year.

These figures are not presented as NSW-specific, and they are based on older research, but they are a useful reminder that pest risk can translate into real post-settlement costs.

Timing in NSW and why it matters

Where possible, the simplest approach is to organise inspections early, before you exchange contracts. NSW Government guidance notes that many consultants need a minimum of 2 to 3 days’ notice to do a building inspection, and encourages getting the vendor’s permission as early as possible in negotiations.

If you exchange first and rely on the cooling-off period, you need a plan. NSW Government guidance states that in NSW you generally have a 5 business day cooling-off period after exchange, ending at 5pm on the fifth business day. It also states that if you withdraw during cooling-off, you must pay the vendor 0.25% of the purchase price. That means inspections, report delivery, and your decision-making all need to happen quickly.

Auctions are different. NSW Government guidance states that a cooling-off period does not apply if you buy at auction, or exchange contracts on the same day as the auction after it is passed in.

If you are bidding at auction, treat building and pest reports as pre-bid due diligence, not something you can easily “sort out later”.

Apartments and strata properties need extra thought

If you are buying a unit in a strata scheme, a building inspection can still help, but its scope may be limited. NSW Government guidance states that for strata scheme and company title properties, the building inspector will normally only inspect and assess the condition of the interior and immediate exterior of the unit. If you want other common property areas inspected, you may need to request a special-purpose property report.

There is also a strong case for reviewing strata records and building history as part of your due diligence. Building Commission NSW research (updated March 2025) reports that 53% of buildings in its strata defects survey had serious defects in common property, and notes waterproofing and fire safety systems as the most prevalent defect types reported in the survey results. That does not mean every building is risky, but it does support taking building condition and common property seriously before you commit.

Using the reports to make a better decision

A “good” report is not necessarily one with no issues. Most properties have some level of wear and tear. The point is to identify major defects, active pest risk, and red flags that change your risk profile.

In practical terms, reports can help you:

• renegotiate price where major defects or pest activity increase your likely cost
• negotiate repairs or clarifications prior to exchange, where feasible
• decide to walk away during cooling-off, understanding the 0.25% cost of doing so
• bid at auction with clearer eyes about what you are taking on

Talk to our conveyancing team

Purchasing is a legal and financial commitment, and the timing of inspections matters just as much as the results. At Greenhills Conveyancing, our team can review the contract, explain your cooling-off position, and help you structure your due diligence so you can make an informed decision before you are locked in. Contact us to discuss your purchase and the most sensible inspection pathway for your property type.

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