What happens if the property you’re buying has had a granny flat added or a deck built, but these changes weren’t approved by the council? Why would a seller leave out this information in the first place? And how can this omission impact you? This article covers reasons why some property contracts skip renovation details, the potential consequences, and how you can protect yourself.
Key points covered
- Common unapproved renovations
- Legal obligations for sellers
- How unapproved renos can impact you
- How to protect yourself as a buyer
Common Unapproved Renovations
Unapproved renovations are more common than you might think, and many buyers don’t realise the potential risks they’re taking on. Here are a few examples of unapproved works that often fly under the radar:
- Patios
- Decks
- Converted garages
- Granny flats
- Sheds
- Garages
- Additional rooms
Legal Obligations for Sellers
As a seller, you have a legal responsibility to disclose any known unapproved renovations. Even if you didn’t carry out the work yourself, the obligation still falls on you to be honest about the condition of the property.
Sellers must disclose any unapproved works they know about. Whether it’s a deck, a granny flat, or an extension, if it wasn’t approved, you need to let the buyer know. There’s no expiration date on illegal structures. Even if renovations were done decades ago, they’re still considered non-compliant unless they’ve been approved.
If you fail to disclose these details, you could face serious consequences like contract termination, legal disputes, and in some cases, significant fines.
Why Do Sellers Omit Renovation Details?
There are a few reasons sellers omit renovation details, and they’re not always malicious.
- Some homeowners don’t realise they need approval for certain renovations, especially if the work was done by a previous owner. They might not even be aware that the deck, shed, or extension wasn’t approved.
- Some sellers worry that disclosing unapproved works could reduce the property’s value or make it harder to sell. They might hope that by leaving out this information, they can push through the sale without issue.
- Often, unapproved renovations are carried out by a previous owner, and the current owner may not even know that certain structures aren’t compliant.
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How Unapproved Renovations Can Affect Buyers
If you’re buying a property with unapproved renovations, it can lead to some serious complications, both financial and legal.
- Once the sale goes through, the responsibility to fix unapproved works falls on the new owner. This might mean paying for costly repairs, obtaining retroactive approval, or even demolishing the structure altogether.
- Unapproved renovations might not meet building standards, which could pose safety risks. If the council finds out, they might issue an order to rectify the situation, which could involve significant legal trouble.
- Insurance companies may refuse to cover unapproved structures, which leaves you vulnerable if something goes wrong. Plus, if you want to make further improvements, you could run into roadblocks when trying to get approval for future work.
How It Affects Sellers
Omitting renovation details from the contract can have serious repercussions for sellers as well. If the buyer discovers unapproved works, they could back out of the sale or demand a price reduction. Even if the deal goes through, the omission could later lead to legal disputes.
Failing to disclose unapproved renovations can result in lawsuits and fines, especially if the buyer faces significant costs to bring the property up to code. And, if the unapproved works are uncovered during the sale process, the seller might need to bear the cost of fixing or legalising the renovations before the sale can go through.
How to Protect Yourself as a Buyer
Dealing with property contracts can be complicated, especially when renovations are involved. This is where having a good conveyancer in your corner can make all the difference. Conveyancers are property experts and can help ensure everything is legally in order and that you’re not caught out by any unapproved works.
- Checking for Approval: A conveyancer can dig into council records to confirm whether all the renovations and structures on the property have been properly approved. If anything’s missing, they can bring it to your attention before you sign the contract.
- Adding Clauses for Protection: They’ll make sure the contract includes clauses that require the seller to disclose any unapproved works. This helps protect you from surprises after the deal is done.
- Helping Sellers Stay Compliant: If you’re selling, a conveyancer can guide you through your legal responsibilities, making sure you disclose everything you need to, so you can avoid issues or disputes later.
- Minimising Risk: Conveyancers can help you understand any risks around unapproved renovations and advise you on how to proceed, whether that means negotiating better terms or requesting repairs or approvals before the sale goes through.
Choose the Experts at Settled
With Settled’s conveyancing experts in your corner, you’ll have a dedicated team looking out for your best interests throughout the property process. We’ll verify that all renovations are approved, include essential clauses to protect you from any hidden issues, and provide expert guidance every step of the way. With Settled, you can move forward confidently, knowing your property purchase is secure. Contact us today and let us help make your property journey smooth and stress-free.
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