Negotiating After a Building Inspection
Use the inspection report's executive summary and major defect list to drive negotiation. Three paths: (1) price reduction equal to the remediation cost of major defects, (2) request the seller remediate before settlement, (3) rescind in cooling-off if defects are deal-breakers. Make the request in writing through your conveyancer, attaching the report. Most reasonable sellers accept some negotiation; some refuse - then you decide if the price as-stands is acceptable.
Three negotiation paths
Price reduction: the cleanest option. You offer to proceed at a reduced price reflecting the cost of remediating the major defects. The seller does no work; the buyer absorbs remediation responsibility.
Remediation by seller: the seller fixes specified defects before settlement. Works best when the seller has the contractors or time to do the work, and when the defects are well-defined.
Rescission in cooling-off: if the defects are too significant or the seller is unreasonable, you exit the contract. Small forfeit applies (see /guides/cooling-off-period-sa).
How to use the inspection report in negotiation
Lead with the executive summary. It's the inspector's plain-English assessment, easier for the seller to engage with than a 40-page report.
Cite specific photographs and defect numbers from the report. Specificity makes the case stronger than 'the inspection identified issues'.
Attach indicative remediation costs from a tradie quote (separate from the inspector). If you can put a number on it, the seller can respond to the number.
Go through your conveyancer. Buyer-to-seller direct negotiation can become emotional; conveyancer-to-conveyancer keeps it professional.
What a reasonable negotiation looks like
Major structural defects (footing movement, roof structure issues): typically negotiate the remediation cost as a price reduction, often $5,000-$30,000 range depending on severity.
Major weatherproofing failures (roof, wet areas, salt damp): similar negotiation, often $3,000-$20,000.
Minor defects and maintenance items: typically not worth negotiating individually. Bundle them as 'general maintenance allowance' if there are many.
Specialist concerns (asbestos, electrical, plumbing): negotiate on the basis of likely specialist remediation cost.
How sellers typically respond
Engaged seller: accepts some negotiation, often around 50-70% of the buyer's initial requested reduction. Common middle-ground outcome.
Unreasonable seller: refuses any reduction and threatens to relist. Your call - is the price as-stands acceptable given the defects?
Surprised seller: didn't know about the defects (or claims not to). Education-led negotiation works here - the report becomes a teaching tool.
Distressed seller: needs to sell urgently, accepts substantial reduction. Lucky for buyer.
When to walk away
Major structural defects with unclear cost - footing movement requiring underpinning is the classic example. Cost can run $30,000-$80,000+. Walking is usually the right call.
Multiple major defects compounding - if the inspector identifies 3+ major issues, the total remediation cost can exceed the buyer's contingency.
Seller refuses any negotiation and the report identifies clear major defects. The seller's signalling that they won't fix issues post-settlement either.
Heritage or specialist properties where remediation cost is unknowable without specialist quotes you don't have time to arrange.
The buyer's mindset
Don't be emotionally invested. Sellers can read panic; it weakens your position.
Have a maximum walk-away price calculated. If the seller won't move to that price, rescind.
Remember: there are other properties. The Adelaide market has options. Walking from one bad deal preserves capital for the next.