"Lemon laws" should be extended to property purchases

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Australia’s consumer protection laws should be strengthened to help prevent people from making potentially disastrous decisions when buying a property.

While those who buy a car, household appliance or any other number of other everyday items are afforded some sort of protection if their purchase turns out to be faulty, the vast majority of Australia has no similar system in place for those who purchase a defective property.

Trish Mackie-Smith, general manager of building and pest inspection firm BuildingPro, believes the current situation across much of Australia needs to be changed with more protection for buyers.

“We have lemon laws for all other products and services, except for houses,” Mackie-Smith told Your Investment Property.

“There’s no consumer protection for buyers if they buy a defective property. They have no comeback, no recourse against a seller if they’ve sold them a property that has structural defects and I believe that’s wrong,” she said.

Mackie-Smith is currently petitioning the Queensland government to adopt a similar system to the ACT were sellers are required by law to notify buyers of any structural defects and finds  it confusing a decision as big as buying a property does not come with more protection.

“Buying a property as a home or investment is probably the biggest, most important purchase someone will make and the biggest asset they will buy and it isn’t right that it’s not protected,” she said.

“In the ACT they do have legislation to protect the buyer. That was introduced in 2003 and has really been working effectively for 13 year and why shouldn’t the rest of Australia follow suit.

“The Queensland Attorney-General is very keen for reform and believes the time is right. There was a review under the Newman government in 2014 and its findings showed there needs to be an improvement around seller disclosure, but nothing came of it. Hopefully with a new government we can see something done.”

While sellers may argue the current situation of buyer commissioning reports before purchasing a property provides them with sufficient information, Mackie-Smith disagrees.

“The buyer may go ahead and get all the building and pest reports done, but they’re really only visual inspections.

“There are also a number of tactics that sellers are using to conceal structural defects so they can’t be visible to the human eye. Things putting like putting heavy furniture in the way so inspectors can’t access or see parts of the house or even just preventing access to parts of the property

“With things like termites, a seller can easily have an infestation they know about but they just patch up or paint over any signs of it and you might not know until years later until the signs show up again.”

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