Buyer Beware! Illegally erected dwellings
Buyer beware illegally erected dwellings can be a major problem.
Recently we conducted research on a property being promoted by the selling agent as a habitable 5 bedroom property, In fact there were two bedroom and a study in the original house at the front of the property and two more bedrooms in a fully detached dwelling to the rear of the property.
After making enquiries with the local council, it was found that no building permit was ever issued for the construction of the rear dwelling. So, council could issue a retrospective demand for the dwelling to comply with requirements for a building permit to be issued. If the property could not meet those standards, the future purchaser would need to either spend money and upgrade the property to standards required for the building permit to be issued, or, if that was not possible, the property may have a demolition order issued.
So, buyer beware, you could be paying for a property and then be asked to demolish it.
If you are an investor and had a lease in place with a tenant on this illegal dwelling, what happens to the tenant if you need to do major works on the property and/or demolish it?
Despite the potential for a higher yield from two potential sources of income, we have not purchased this property and continue to hunt for a safer, less risky option for our investor client.
As professional property buyers we cannot stress how important it is to thoroughly research your target property before you commit or hire a reputable, REIV and REBAA accredited Buyers Agent to do it for you.
For independent advice on buying, leasing or selling real estate, contact Buyer Solutions +61 3 9816 8555 or email jspencer@buyersolutions.com.au
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