How to Handle Inspection Issues Before Settlement

A building inspector finds rising damp beneath a bathroom vanity. A termite inspector flags old timber damage in the roof space. The buyer sees a lengthy report and assumes the deal is in trouble. This is the point where knowing how to handle inspection issues matters. Not with panic, vague promises or rushed discounts, but with facts, priorities and a clear negotiation position.

Inspection issues are common. A report is designed to identify risk, including minor maintenance items that may look more alarming on paper than they are in practice. The goal is not to pretend a property is perfect. The goal is to separate genuine deal risks from ordinary ownership realities, then respond in a way that protects your position and keeps the transaction moving.

Start with the contract, not the emotions

The first question is not, “How much will this cost?” It is, “What does the contract allow?” Inspection negotiations depend on the special conditions agreed before the contract was signed. These conditions set out the inspection timeframe, the type of reports permitted, what qualifies as a major defect, and how notice must be given.

In Western Australia, contract terms and deadlines matter. A buyer may have rights to raise concerns under a building, timber pest or other inspection condition, but those rights are not unlimited. Equally, a seller is not automatically required to agree to every request that follows an inspection report.

Read the notice carefully. Check that it was issued on time, identifies the relevant issue and follows the agreed process. Your selling agent and conveyancer can help you understand the practical implications, but legal interpretation should come from your conveyancer or solicitor. Do not make admissions or agree to works before you know where you stand.

Read the report in context

Inspection reports often contain pages of observations. Some are useful warnings. Others are standard recommendations to monitor, maintain or obtain further advice. Treating every line as a deal-breaking defect is how good negotiations unravel.

Ask for the full report, not a verbal summary or a cropped screenshot. Then look at each issue through three filters: safety, structural impact and likely cost. A loose door handle, worn sealant and ageing tapware may be valid maintenance items, but they are not in the same category as active termite damage, significant movement, unsafe electrical work or water ingress affecting the building.

Pay close attention to the wording. “Recommend further investigation” does not mean a defect has been confirmed. “Evidence of previous damage” is different from active damage. “Unable to inspect” may simply mean the inspector could not access an area, not that a problem exists there.

If the report raises a material concern, get an appropriately qualified tradesperson or specialist to assess it. A roofer can clarify a roofing issue. A plumber can locate the cause of moisture. A pest technician can determine whether termite activity is current, historical or absent. A second opinion costs money, but it can prevent a much larger and unnecessary concession.

How to handle inspection issues as a seller

Sellers need to remain responsive without becoming reactive. Once an issue is verified, there are generally three workable paths: complete the repair, offer a price adjustment, or hold your position where the issue is minor, disclosed or already reflected in the agreed price.

Repairing the issue can be the cleanest option when the work is straightforward, urgent and likely to affect another buyer if the current contract falls over. It may also preserve the sale price. The trade-off is timing. Repairs must be done properly, documented and completed without creating a settlement delay.

A price adjustment can be more practical when the buyer wants to choose their own contractor, the work cannot reasonably be completed before settlement, or the issue is not urgent. The adjustment should be based on credible quotes, not an inflated estimate designed to reopen the whole deal. A request for $20,000 off because of a $3,000 repair is not a reasonable compromise. It is a renegotiation attempt.

Holding firm may be appropriate when the report identifies normal wear and tear in an older property, cosmetic maintenance, or issues the buyer could reasonably have observed during inspections. Price, property age and condition all matter. A buyer purchasing an original 1980s home cannot reasonably expect it to perform like a new build.

Whatever path you choose, put the agreement in writing. Specify the work, who will complete it, the deadline, evidence required and what happens if access or timing becomes an issue. Loose verbal arrangements create disputes. Clear written terms create control.

Avoid the open-ended repair promise

“Seller to fix all inspection items” is a poor agreement. It is broad, subjective and almost guaranteed to cause an argument later. The buyer may expect a full upgrade. The seller may intend a basic repair. Neither side has a clear standard.

A better agreement identifies the exact issue and outcome. For example, repair the identified roof leak by a licensed contractor and provide the paid invoice before settlement. Specificity protects both sides.

How to handle inspection issues as a buyer

For buyers, a report is leverage only when it identifies a genuine, material concern. Use it to make an informed decision, not to chase every minor imperfection in the hope of reducing the price.

Start by ranking issues. Is there a safety risk? Could it become expensive quickly? Does it affect your ability to insure, finance or occupy the property? Is it likely that you would have paid differently had you known about it? Focus your response there.

If you want a repair or adjustment, make a measured request backed by evidence. Include the relevant report section and, where possible, a quote or specialist advice. This is more credible than sending a broad list of maintenance items and demanding that the seller resolve all of them.

Be realistic about the property you agreed to buy. Older homes have quirks. Coastal properties around Mandurah may show weathering, corrosion or moisture exposure that requires ongoing maintenance. That does not automatically mean the property is a bad purchase. It means you need to understand the future cost of ownership and decide whether the agreed price still makes sense.

If the issue is substantial, do not rely on guesswork. Obtain expert advice quickly and speak with your conveyancer about your contractual options before the inspection deadline expires. Waiting until the final day reduces your choices and puts pressure on everyone involved.

Keep the negotiation focused

Inspection negotiations can become emotional because both sides feel exposed. Sellers may feel a buyer is trying to chip away at the price. Buyers may worry they are inheriting a costly problem. Neither reaction helps unless it is anchored to evidence.

Keep the discussion centred on four points:

• What is the confirmed issue?
• How serious is it?
• What is a reasonable cost to address it?
• What outcome allows the sale to proceed fairly?

This approach prevents the inspection from becoming a second round of price negotiations disguised as maintenance concerns. It also gives each party room to make a sensible decision. Sometimes a modest credit is the right answer. Sometimes a repair is justified. Sometimes the right answer is no change at all.

Strong representation matters here. The role of the agent is not to make the problem disappear or pressure either party into an unclear agreement. It is to keep communication direct, obtain the right information and drive a resolution that can withstand scrutiny. Beshay Realty approaches inspection negotiations with that discipline: facts first, clear options, no being left in the dark.

Protect settlement once an agreement is reached

A resolved inspection issue still needs follow-through. If repairs are agreed, organise access, trades and paperwork promptly. Keep invoices, warranties, photographs and compliance documents where relevant. The buyer should have reasonable evidence that the agreed work has been completed, while the seller should avoid allowing new or unrelated demands to emerge at the final inspection.

Buyers should conduct their final inspection close to settlement and focus on the agreed items, inclusions and the property’s general condition. Sellers should leave the property in the condition required by the contract, remove rubbish and ensure agreed fixtures and fittings remain. Small oversights at this stage can create avoidable tension just when the transaction should be closing cleanly.

The best inspection outcome is rarely about winning every point. It is about making a clear-eyed decision, documenting the result and moving forward without uncertainty. A well-managed issue does not have to derail a good property deal. It can show that both sides are dealing properly when it counts.