How to Protect Yourself with a Building & Pest Condition

 
 

When buying a house in Victoria, a building and pest condition is one of your most powerful tools to avoid unexpected surprises. But not all clauses are equal. A poorly worded condition can leave you stuck with a lemon — or unable to get out of the contract even when serious issues are found. Here's how to do it properly.

What Is a Building & Pest Condition? It’s a clause in the contract that makes your purchase subject to satisfactory building and pest inspection reports. If those reports reveal major defects or infestations, the condition lets you cancel the contract and walk away — but only if the wording is clear and the steps are followed precisely.

Standard vs Custom Clauses Many agents use the standard REIV condition (GC 21 for building, GC 22 for pest), but these are not always buyer-friendly:

  • You must use a registered builder or licensed pest operator — or the report may not be valid.

  • The defect must be major — and many conditions don’t define what that means.

  • You must act promptly and reasonably, and notify the vendor in writing.

If you rely on an unlicensed inspector, or send vague or late notices, you could lose your right to cancel the contract.

How We Improve It At Victorian Property Settlements, we’ve developed a unified building & pest condition that:

  • Gives 14 days for both reports

  • Defines major structural defect as requiring over $5,000 in repairs

  • Defines active infestation as live timber pests requiring treatment over $5,000

  • Allows the purchaser to rescind or renegotiate

  • Ensures the clause survives until settlement

  • Requires vendor to allow access for inspections

This gives real protection and sets clear expectations for all parties.

What Happens If You Find a Problem? If the reports reveal serious issues, you must:

  • Notify the vendor in writing before the condition deadline

  • Include a copy of the report

  • Clearly state whether you are rescinding or seeking to renegotiate

We help clients word these notices properly and ensure they’re delivered on time, so their rights are preserved.

When It’s Too Late If the condition deadline passes without you raising concerns, the contract becomes unconditional — even if major issues are later discovered. That’s why timing is everything.

What If There’s No Clause in the Contract? If the contract doesn’t already include a building and pest clause, it can often be inserted before signing. We’ll handle the negotiation and make sure the clause actually protects you.

Once a contract is signed, it’s very hard to add the condition — especially for private sales.

Need a Contract Reviewed or Condition Added? Click here to request a contract review and we’ll make sure your building and pest condition is watertight.

Victorian Property Settlements – Trusted for over 25 years by Victorian buyers and sellers. Visit: www.victorianpropertysettlements.com.au