Try Before you Buy, not necessarily Renovate before you Buy

This article in the SMH rightly raised concerns about the practice of some purchasers beginning to renovate a property before settlement.

There are many issues associated with obtaining access to a property prior to settlement to do some 'work' on the property:

• Insurance and Liability - who is liable for accidental damage to the property from the works?
• OHS Issues - who is liable for OHS breaches and issues?
• Council approvals - does the work require approval from Council?
• Does the early access constitute early possession? 
• Commercial risks associated with the sale not proceeding, having to make good and other insurance issues.

If you are buyer and are interested in doing some work before settlement, you should raise this with your lawyer before exchanging the Contract. Amendments to the Contract may need to be drafted to protect your interests and appropriately apportion liability for the risks involved.

Similarly, if you are a vendor and your purchaser asks you for permission to begin work, you must get the right advice to ensure that your renovator's delight doesn't become your renovator's nightmare!

Jonathan Marquet
Emil Ford Lawyers