Posts Tagged ‘House Maintenance’

There is a Problem With the Building Inspection! What Should I Do?

The first thing you need to do when your building inspection identifies a problem is to work out how serious the problem is – a good person to question initially is the person who did your building inspection – you need to make sure that you fully understand the problem that they have identified.

Building Inspection Problem? Get a Specialist Building Advice

A building inspector is not an expert in all aspects of building so if a particular problem has been identified and the building inspector has indicated that they cannot tell you the extent of the problem or the cost to fix - it is best to speak to, or get quotes from, an expert in the area.

Say the piles are a problem – speak to a replier – they will be able to assess the extent of the problem and give you a quote for the remedial work.

Now you are in a position to start making decisions depending on your situation...

I Have a Signed Sale and Purchase Agreement

You may have gotten the building inspection as part of working through the conditions on a sale and purchase agreement. If you are not happy with the building inspection:

  • You are now legally entitled to cancel the agreement. To do this you tell your lawyer, and usually the real estate agent that you are not going unconditional based on an unsatisfactory building inspection. This can be a very hard decision to make as by this stage you have invested time, money, and emotion in the house, but in many cases it is the best decision.
  • You can re-negotiation the price of the house with the vendor. Go into negotiations with quotes for remedial work in hand – and bargain hard! Don't forget, it always pays to budget for some extras!
  • You can ask the vendor to fix what is wrong before you buy the house. Especially if the problem is fairly easy to fix i.e. a few hours work by a plumber or electrician this is often a good solution. If the problem is major – the vendor will rarely agree to fix it.
  • You may still be happy to proceed with purchasing the house at the agreed price - and you still can. Perhaps none of what was identified in the building inspection is a surprise, or you now know why the house was a reasonable price from the beginning! Before proceeding double check your numbers, make sure you are happy with the amount you are going to have to pay in repairs and renovation, and add a contingency of at least 10%.

If you and the vendor come to an agreement that involves the vendor having to complete work, or the price changes, or anything else at all, this needs to be formalised in the sale and purchase agreement by your lawyer.

Even if the work agreed is small (i.e. rubbish removal or repairing flashing) and seems insignificant to include – the reality is that it will not be done unless the vendor commits to it via the sale and purchase agreement.

I Haven’t Started Price Negotiations

If you have obtained this building inspection before even beginning negotiations on a house that you are interested in you have similar options:

  • You can walk away – the house is not suitable anymore – move on!
  • You can start price negotiations fully armed with exactly what is going on with the house. This is a much stronger bargaining position then if a price had already been agreed and a reduction was being negotiated. It is hard for people to comprehend that seemly overnight their house price has decreased significantly.
  • You can start negotiations from the beginning with a condition that lists things for the vendor to fix before you will settle on the house – again, if the problems are extensive - this can be a very short negotiation!

Sometimes the extent of the remedial work needed to fix a problem identified by a building inspection can not be worked out exactly by a ‘surface only’ examination by a building inspector or tradesman i.e. extent of rot given evidence of rotten weatherboards.

In these situations you will only be able to get an estimate of the cost of fixing – as a lot will depend on the extent of the problem and this will only be known when the remedial work starts.

It is up to you here to make a decision based on how much of a risk you want to take! In these cases, if you are not comfortable with what can potentially be an unknown, and large, expense it is best to walk away.

Building Inspection Problem - What To Do

The Propertytoolbox Home Buyers Guide

The information you have just read about building inspection problems has been added to the Propertytoolbox house buying guide - An essential resource for house buyers in New Zealand. Find out more about house buying in New Zealand here.

House Maintenance Budget? Costs of Home Ownership…

Before you buy a home you need to know the full cost - and we are not just talking about mortgage repayments here! Yes, the mortgage is the most obvious and high profile cost of home ownership and usually is by far the largest one. But don't forget about rates, insurances, water, repairs and maintenance!  So just how much is this all going to cost?

The mortgage is usually the first figure calculated - and often dictates what the house buying budget is for many people. The biggest thing to consider here is the potential effect of an interest rate change. Currently interest rates are low, this almost certainly means that in the future your mortgage repayments are going to be higher. A good way to see the effect a change in interest rate has on your mortgage repayment is to have a play with a mortgage calculator - put in a variety of interest rates and see the effects. Here are some statistics for average bank 2 year fixed home loan interest rates that give you some numbers to play with:

Current 2 year fixed home loan rate = 7.1%

Average home loan interest rate for last 5 years = 8.0%

Home loan interest rate mid 1998 = 10%

Home loan interest rate April 2008 = 9.6% 

Home loan interest rate May 2003 = 6.7% 

With costs such as rates, insurance, and water you will be able to find out the exact amount these will be for the first year at least. These will go up year on year, sometimes by an amount far exceeding inflation, so factor this in. If you budget for an increase of 10% every year for these bills you are unlikely to be caught short.

As a bare minimum you should allow $1,500 or better yet 0.3 - 0.5% of the value of your house per year for maintenance. This does vary widely depending on the age, size and condition of your house and the building materials used. You may not use all of this maintenance money one year, and then have major expenses the next! But it will average out over time. Maintenance cannot be avoided, so budget for it!

Something you may not have thought about is all those extra bits and pieces that you are going to need to buy for your new home - new furniture, new appliances, what about plants for the garden? And are you planning any renovations?

How much you want to spend on renovation and new things for your house and grounds is up to you, but there is no doubting you will want to spend money, so establish a budget.

So when you work out how much you can afford to pay for a house, remember to add on all those extra expenses! A good rule is to add another 20-30% to your mortgage repayments to cover rates, insurance, water, small improvements, new stuff, and repairs and maintenance.

Ultimately you will have to come up with the money for all these extra things from somewhere - so take this into account when you are working out how much you can afford in repayments.

This information is part of the Propertytoolbox mortgage & money guide - This guide contains heaps of good info about the money part of home buying. Read more here.

Does The House Need Repiling? Repiling NZ Style…

What are Piles?

Piles are wooden or concrete posts under a house that form the foundations and are what many New Zealand houses sit on. The job of the piles is to distribute the weight of the house evenly across the soil underneath, and the house construction distributes the house weight as evenly as possible over the piles, ensuring the house stands straight and square.

Over time piles can rot away, causing them to fail, uneven distribution of house weight over piles can cause uneven settling, or movement of the ground under and around piles can cause piles to move.

Repiling a house NZ Style - Not a Firm Foundation

Not a Firm Foundation

Repiling a house NZ Style - 100+ Year Old Totara Piles

100+ Year Old Totara Piles

Has the house been repiled?

If the house was built in an era that used totara piles, an a examination of the piles under the house will soon determine if repiling has happened. New piles are either concrete or tanalised (H5) pine and are easy to spot.

Make sure to check out that all the piles have been replaced. It is quite common to see that only a few piles are new, often these are the piles around the edge of the house.

Why repile?

Sometimes all the piles move, but more often different piles move to different extents. This causes the house to twist, bow, and crack, resulting in damage. The piles may have stopped moving, or may be continuing to move - this all depends on the cause of the movement. To halt ongoing damage, re-piling is necessary. If you are planning renovations, it pays to start with firm foundations or you are going to end up with an inferior result.

About repiling

Repiling involves digging new piles down to a firm base and attempting to re-align the house on this new foundation. Sometimes it is obvious that repiling work is necessary. You may find yourself walking up hill and down around a house! Usually it is a lot more subtle.

To establish if the piles are a problem and to what extent, you will need to ask the experts. A house inspector is a good start. Make sure you get a good idea as to what is caused the need for repiling – it this likely to be an ongoing issue? i.e. poor soil, ongoing subsidence, risk of landslide. Can the cause be fixed? i.e. leaking pipe, drainage issues causing water to run under the house.

Repiling - The process

Repiling is a major job and different repilers repile use different methods - some cut holes in the floor to access under the house and some lift the entire house up. The technique used depends on a variety of factors with access being a big deciding factor and personal preference and tools and equipment available to the repiler having an influence too.

Repiling a house NZ Style - Lifting up the House

Lifting up the house

Repiling a house NZ Style - Cutting the Floor to Place House Raising Jacks

Cutting up the floor to place jacks

I am repiling - What else can I do?

Repiling opens a lot of opportunities to do other things to a house, it can be moved, lifted up and another level added underneath, or shifted somewhere else completely! The access that is gained under the house is also an opportunity to do things underneath that in usual circumstances are quite difficult - like underfloor insulation and working with the plumbing and electrical systems.

Repiling a house NZ Style - Access Under the House During Repiling

Access under the house during repiling

Repiling a house NZ Style - Moving a house during repiling

This house was moved across 1m during repiling

Repiling requires a building permit - other additions and changes to the house can be added to the same permit so it pays to plan in advance exactly what you want to do with a house before you repile so all your permissions can be gained at the same time - saving money - and also allowing you to organise access under the house for other works while the repiling is happening.

How much for a repile?

If you need to repile get a repiler in for a quote. Re-piling costs vary hugely and depend on many. Repiling costs start at around $12,000 - 15,000 (for a very small house, on the flat with fantastic access) and quickly climb when you start getting into soft soils, erosion problems and difficult access.