You've exchanged contracts, navigated the settlement period and are now just days away from collecting (or handing over) the keys. There is, however, one final and crucial step before settlement is complete: the pre-settlement inspection.
Whether you're a buyer preparing to move in or a seller getting ready to vacate, understanding what a settlement inspection involves, and what to expect, can help ensure a smooth, stress-free handover.
What Is a Pre-Settlement Inspection?
A pre-settlement inspection, also known as a final inspection, is the purchaser's opportunity to revisit the property shortly before settlement. Its purpose is simple but critical: to confirm that the property is in the same condition as when contracts were exchanged.
This includes ensuring:
- The property has not been damaged
- All agreed inclusions remain in place
- Any negotiated repairs have been completed
- The home is clean and ready for handover
In practical terms, a buyer is entitled to check that the pool hasn't turned green, the carpets are still intact and the overall condition of the home has been maintained. It is not about expecting improvements, only that nothing has worsened.
For sellers, this inspection is equally important. It provides an opportunity to demonstrate that all contractual obligations have been met, helping avoid last-minute disputes or delays.
Why Are Pre-Settlement Inspections Important?
Settlement periods typically range from 30 to 90 days, although they can be shorter or longer depending on the contract. During this time, a property's condition can change—particularly if it remains occupied.
A pre-settlement inspection acts as a safeguard by ensuring:
- The property condition matches what was agreed upon
- Fixtures, fittings and appliances are in working order
- The home has been properly vacated
- No new damage has occurred
Without this step, buyers risk taking possession of a property with unexpected issues, while sellers risk delays if concerns are raised too late.
Ultimately, it protects both parties and helps ensure a fair and transparent transaction.
When Does the Inspection Take Place?
The inspection is usually conducted in the final week before settlement, often a few days prior. Timing is important:
- Too early, and issues may arise again before settlement
- Too late, and there may not be enough time to resolve problems
Your real estate agent will typically coordinate a suitable time between buyer and seller.
Who Arranges the Inspection?
In most cases, the selling agent organises the pre-settlement inspection. It usually runs for around 20–30 minutes, so preparation is key.
If the sale is private, the buyer and seller will arrange a mutually convenient time.
For buyers, attending alongside the agent (and sometimes the seller) can be beneficial, particularly if you want to ask practical questions about the property, such as how systems or appliances operate.
What Should Buyers Check?
Buyers should approach the inspection methodically, referring back to the contract of sale and inclusion list. This is your final opportunity to ensure everything is as agreed.
Key areas to check include:
Fixtures and Electricals
Test all light switches, ceiling fans, exhaust fans, garage doors and intercoms. Ensure everything included in the contract is present and functional.
Appliances
Turn on and test all fixed appliances, including:
- Oven and stovetop
- Dishwasher
- Rangehood
- Air conditioning and heating systems
Plumbing and Water
Check all taps, toilets and showers for proper function. Look for leaks under sinks and ensure hot water is working.
Doors and Windows
Open and close every door and window. Confirm locks are functioning and handles are secure.
Flooring and Walls
Inspect for any new damage such as stains, cracks or holes that were not present at contract exchange.
Outdoor Areas
Ensure gardens, lawns and outdoor spaces have been reasonably maintained. Check taps, irrigation systems and any included outdoor features.
Inclusions and Exclusions
Cross-check that all included items remain and excluded items have been removed. This may include:
- Curtains or blinds
- Light fittings
- Furniture (if specified in the contract)
Cleanliness and Vacant Possession
The property should be:
- Free of rubbish
- Reasonably clean
Keys and Access
Confirm that all keys, remotes, alarm codes and access devices will be handed over at settlement.
What Should Sellers Do to Prepare?
For sellers, preparation is just as important. A smooth pre-settlement inspection can prevent delays and ensure settlement proceeds as planned.
Here's what sellers should focus on:
Maintain the Property's Condition
The property must remain in the same condition as when it was sold. Avoid any neglect during the settlement period.
Complete Agreed Repairs
If repairs were negotiated during the sale, ensure they are completed before the inspection. Where possible, keep receipts or documentation.
Remove All Belongings
Ensure all personal items and rubbish are cleared from:
- Inside the home
- Garage and storage areas
- Outdoor spaces
Leave the Property Clean
While professional cleaning is not always required, the property should be left in a tidy and presentable condition.
Check Inclusions
Double-check that all items included in the contract remain in place.
Prepare Keys and Access Devices
Have all keys, remotes and access tools ready for handover.
What Happens If There's an Issue?
If a buyer identifies a problem during the inspection, it should be raised immediately with their conveyancer or solicitor—not directly with the seller.
Common issues might include:
- New damage (e.g. broken windows or holes in walls)
- Missing inclusions
- Uncompleted repairs
In most cases, the following outcomes may occur:
- The seller agrees to fix the issue before settlement
- A financial adjustment is made to cover repair costs
- Settlement is delayed until the issue is resolved
It's important to note that general wear and tear is usually not considered a breach of contract.
Can Buyers Negotiate After the Inspection?
Only under specific circumstances. Buyers cannot request upgrades or improvements that were not part of the original agreement.
However, if the property is in a worse condition than at exchange, buyers may:
- Request repairs
- Seek compensation through a price adjustment
Any claims must be supported by evidence and align with the contract terms.
How Many Inspections Are Allowed?
Typically:
- One pre-settlement inspection is standard
- A second inspection may be permitted if repairs need to be verified
The second inspection is strictly to confirm rectification, not to raise new concerns.
Final Tips for a Smooth Inspection
For both buyers and sellers, a calm and organised approach makes all the difference.
- Review the contract carefully beforehand
- Allow enough time before settlement for any fixes
- Communicate through agents and conveyancers
- Stay objective and focus on contractual obligations
A pre-settlement inspection is not just a formality, it's your final checkpoint before ownership changes hands.
Ready to Make Your Move?
If you've been thinking about selling, don't wait until the market is flooded with listings. Take advantage of the current demand and maximise your property's value.
Contact Century 21 Novocastrian today for a free, no-obligation appraisal and let's set your property up for success!
EMAIL | newcastle.com.au">hello@c21newcastle.com.au
PHONE | 02 4943 6333
160 Pacific Highway
Charlestown NSW 2290