Top tips to inspect a property as a first home buyer

What to Focus on Before You Walk Through the Door

Before you step inside, check the external building condition and the surrounding site.

Start with the roof line. Look for sagging or uneven sections that might suggest structural movement. In Baldivis, where clay-reactive soils are common across newer estates, subsidence can show up as cracking in external render or brick courses near ground level. Walk the perimeter and check whether doors and windows sit square in their frames. If they look twisted or gaps appear uneven, the slab may have shifted.

Look at stormwater drainage around the property. Water pooling near the foundation or staining on external walls can point to poor site drainage. Baldivis sits on coastal plain, and some blocks have minimal fall. If the block drains toward the house rather than away, that creates ongoing risk.

Check fencing condition and boundaries if they're visible. Leaning or damaged fences are not always cosmetic. They can indicate soil movement, and replacement costs add up quickly if you're already stretching your deposit.

How Building Condition Affects Your Home Loan Application

Lenders assess the property as security, and visible defects can reduce the property's valuation or trigger additional conditions on your loan approval.

Consider a buyer working with a 5% deposit under the Australian Government 5% Deposit Scheme. The property must meet the lender's valuation standards, and any structural issues flagged during a bank valuation can delay or reduce the approved loan amount. If the valuer notes cracking, roof damage, or drainage concerns, the lender may require a building inspection report or pest inspection before proceeding. In some cases, the lender may reduce the valuation below the purchase price, leaving the buyer to cover the shortfall or renegotiate.

This matters more when your deposit is small. With a 10% deposit, you have slightly more room to absorb a lower valuation or negotiate repairs. With 5%, the margin is thin. Every dollar counts, and any reduction in the property's assessed value can push you outside your borrowing limit or require additional savings to settle.

If you're relying on a low deposit option, treat the inspection as a financial checkpoint, not just a physical one. What you find during the inspection directly affects whether the lender will support the purchase at the agreed price.

What to Check Inside the Property

Inside, focus on the condition of structural elements, wet areas, and major fixtures.

Check ceilings and internal walls for cracks. Hairline cracks in plaster are common and usually cosmetic, but wider cracks or cracks that run diagonally across walls and ceilings can indicate foundation movement. In Baldivis, this is worth noting given the soil type. Press lightly on the ceiling near any water staining. Soft or spongy areas suggest a roof leak that has not been repaired.

Inspect wet areas closely. Run taps in the kitchen, bathroom, and laundry. Check under sinks for leaks or water damage to cabinetry. Look at tile grout in showers and around baths. Missing or cracked grout lets water through, and that leads to structural timber damage over time. Lift the edge of any vinyl or laminate flooring near wet areas if possible. Staining or soft spots underneath point to leaks.

Open and close every door and window. Sticking doors can be a sign of frame movement. Check window seals and flyscreens. Replacements are not cheap, and if several windows need work, the cost adds up.

Turn on lights, exhaust fans, and air conditioning if installed. Note anything that does not work. While minor repairs might be negotiable, a full air conditioning replacement in a Baldivis summer is a significant expense if it's not factored into your budget.

Understanding Settlement Costs and Repair Buffers

Settlement costs include more than just your deposit.

You will need to cover conveyancing or legal fees, building and pest inspection fees, loan application fees if applicable, and government charges. If you're accessing the First Home Owner Grant or stamp duty concessions in Western Australia, those reduce your upfront cost but do not eliminate it. For a property purchased under the state's First Home Owner Rate of duty, you may pay no transfer duty on a home valued up to $600,000, or a reduced rate on a property valued between $600,001 and $800,000. That saves you thousands compared to a standard buyer, but it does not cover other settlement expenses.

If the property inspection reveals repairs, you need to decide whether to negotiate a price reduction, ask the seller to complete the work before settlement, or walk away. If you proceed without adjustment, those repair costs come out of your savings after settlement. That can leave you without a financial buffer in the first few months of ownership.

When you apply for a home loan, lenders assess your savings and your capacity to service the loan. They do not typically account for post-settlement repair costs unless those repairs affect the property valuation. That means if you spend your remaining savings on repairs in the first few weeks, you have no buffer for rates, insurance, or other holding costs. Plan for this during the inspection, not after you have signed the contract.

How Inspection Findings Connect to Loan Features

What you find during the inspection should influence the loan structure you choose.

If the property needs minor work after settlement, an offset account lets you park any remaining savings and reduce the interest charged on your loan while you decide how to allocate funds. If you are not sure whether you will need to access savings for repairs, a loan with redraw lets you make extra repayments and pull funds back if required, though access is not always instant and some lenders limit withdrawal frequency.

If the inspection flags larger concerns and you are waiting on a second quote or further assessment, a longer pre-approval period gives you time to resolve those questions before committing. Most pre-approvals last 90 days, but some lenders offer extensions if your circumstances have not changed. Knowing your loan features before you inspect helps you move quickly when you find the right property and adjust your approach when concerns arise.

Baldivis has a mix of established homes in older pockets near the town centre and newer builds in growing estates to the west and south. Established homes may show wear in kitchens, bathrooms, and roofing that requires attention within the first few years. Newer homes may still be under builder's warranty, but that does not always cover minor defects or items outside the warranty scope. Your loan structure should reflect the likely cost profile of the property you are inspecting, not just the purchase price.

Questions to Ask During the Inspection

Ask the selling agent or owner when major components were last replaced or serviced.

Ask about the age and condition of the hot water system, oven, cooktop, and air conditioning. Ask when the roof was last inspected or repaired. Ask whether there have been any insurance claims for water damage, fire, or storm damage. Not all sellers will volunteer this information, but asking puts it on the record and gives you a basis to follow up during due diligence.

If the property is in a strata or community title scheme, ask for the most recent strata minutes and financial statements. Look for upcoming special levies, disputed maintenance items, or unresolved defects in common areas. These affect your holding costs and your ability to service the loan. Lenders will review strata records as part of their assessment, and any red flags in those records can delay or block your application.

If the property has solar panels, ask whether they are owned outright or subject to a lease or power purchase agreement. Some agreements transfer to the new owner and include ongoing payment obligations. If the panels are leased, that creates a financial liability that may not be reflected in the asking price.

When to Walk Away

Not every property is worth pursuing, even in a tight market.

If the inspection reveals structural damage, active pest infestation, or significant water damage that the seller is not prepared to address or adjust the price for, walking away protects your deposit and your borrowing capacity for a better opportunity. Structural repairs can run into tens of thousands of dollars, and if the property is already at the top of your budget, you will not have the funds to fix it after settlement.

If the lender's valuation comes in below the purchase price and the seller will not negotiate, proceeding means finding additional deposit funds to cover the gap. For most first home buyers working with a low deposit, that is not feasible. Walking away is not a failure. It is a financial decision that keeps your loan application and your savings intact for the next property.

If the property requires immediate work to make it habitable and you do not have savings set aside beyond your deposit and settlement costs, you are setting yourself up for financial stress in the first months of ownership. In our experience, buyers who proceed despite clear warning signs during the inspection often return within six months looking to refinance or access additional funds, and by then their options are limited.

Arranging Your Loan Around What You Find

Once you have completed your inspection and decided to proceed, your loan application should reflect the property's condition and your immediate costs.

If you are using the Australian Government 5% Deposit Scheme, confirm that the property meets the applicable price cap. For Baldivis, the cap is $850,000 as the suburb falls within the Perth metropolitan postcode classification under Housing Australia's guidelines. If you are purchasing a new home, check your eligibility for the $10,000 First Home Owner Grant and the First Home Owner Rate of duty concessions available in Western Australia. Both reduce your upfront costs and improve your cash position at settlement.

If the property is an established home, the First Home Owner Grant does not apply, but you can still access the stamp duty concession if the property is valued within the eligible range. For a home valued up to $600,000, no transfer duty applies. For a home valued between $600,001 and $800,000, a concessional rate applies. That leaves more of your savings available for settlement costs and any post-inspection repairs you have agreed to cover.

Your mortgage broker can help structure your loan to match your situation. If you need flexibility to access funds after settlement, prioritise a loan with an offset account or redraw facility. If you want predictable repayments while you settle in, consider splitting a portion of your loan to a fixed interest rate. The right structure depends on what you found during the inspection, what you have agreed to cover, and how much financial buffer you have after settlement.

Call one of our team or book an appointment at a time that works for you. We will walk through your inspection findings, confirm your borrowing capacity, and arrange a loan structure that fits the property you are buying and the costs you are facing.

Frequently Asked Questions