Can You Trust the Building Report the Agent Gives You

Treat an agent supplied building report as background, not protection, because it was usually ordered by the vendor or platform and the inspector’s duties are usually owed to that client, not to you. In a Victorian private sale, GC21 usually only helps if the building report box in the particulars is ticked and a compliant major defect report is used within 14 days from the day of sale. At auction, assume you need your own inspection before you bid, because the usual cooling off and post signing inspection safety nets generally won’t be there.

Why is the agent giving you a building report?

The agent shares a report because it keeps the sale campaign moving. One report is quicker than arranging five separate inspectors through a tight Saturday campaign, especially when the vendor wants a clean run to auction or a fast private sale.

That does not mean the report is useless. It may identify obvious issues, give you a starting point for questions, and help you decide whether the property is worth another look. Shared inspection reports can also reduce the cost for buyers who are inspecting several homes across Melbourne and getting outbid each weekend.

The catch is simple: the report was not usually ordered by you. If the vendor, agent or platform arranged it, the legal relationship may sit somewhere else. That is why the price of the report is not the main issue. The main issue is whether you can rely on it if something goes wrong.

Who does the building inspector owe duties to?

Usually, the inspector owes duties to the person or business that engaged them. A report supplied through the agent will commonly name the vendor, the inspection company, or a platform user as the client, and the fine print may say other readers should not rely on it.

That fine print matters. Many building reports are visual inspections of accessible areas only. They normally do not test plumbing, electrical systems, waterproofing behind tiles, concealed framing, subfloor areas that cannot be accessed, or defects hidden by furniture, stored items or fresh paint.

Consumer Affairs Victoria tells buyers to be wary of property inspection reports offered by an agent or seller, and to get their own report if they want it to be independent and accurate. That advice is practical. If the shared report misses rising damp, termite damage, failing stumps or a serious roof issue, you do not want to find out later that nobody clearly owed you responsibility for the report.

We’ve had clients come to us when a shared report used soft wording such as ‘monitor cracking’ or ‘further investigation recommended’, then the buyer discovered after signing that the issue was much larger than it first sounded. It is far easier to ask hard questions before you sign than to unwind a contract after the day of sale.

Can the agent’s building report let you cancel the contract?

Usually, no. In Victoria, a bad building report only gives you a clear contractual exit if your contract gives you that right and you follow the clause properly.

The standard LIV and REIV contract contains a building report condition, known as general condition 21 or GC21. Under the updated form, a buyer may be able to end the contract within 14 days from the day of sale if all required steps are met. The report must be written, prepared in line with AS 4349.1 2007, and come from a registered building surveyor, registered building inspector, registered domestic builder or architect. It must identify a current defect in a structure, and the report writer must state that it is a major defect. The buyer also needs to give the vendor the report and a written notice ending the contract, and must not be in default.

There is a bigger hurdle before all of that: GC21 only applies if the relevant box in the particulars of sale is checked. If that box is blank, the standard clause is not there to rescue you. A building inspection clause is a powerful protection, but only when it is active, properly worded, and used on time.

An agent’s report makes those steps harder. You did not choose the inspector, you may not know whether the author fits the contract wording, and the report may not describe the defect in the words the clause needs. If you are buying by private sale, ask your conveyancer to check the contract before you sign, not after the inspection result lands in your inbox.

Does the Section 32 vendor statement include a building report?

No. The Section 32 vendor statement is a disclosure document, not a building condition report.

Under the Sale of Land Act 1962, a Section 32 must disclose listed matters such as title details, mortgages and charges, easements, covenants, planning information, notices, rates, outgoings, owners corporation information where relevant, and certain building permit information. It may also need to include owner builder information in particular cases.

That does not mean the seller must give you a general pre purchase building report. For an ordinary established house or apartment, a missing building condition report will not automatically make the Section 32 defective.

This point catches buyers out. If the Section 32 leaves out a required disclosure, you may have rights before settlement depending on the facts. If a voluntary building report supplied by the agent later proves too optimistic, that is a different problem. Do not treat a glossy inspection attachment as if it has the same legal role as the vendor statement.

What changes when you buy at auction?

Auction buyers have less room to move, so the building report deserves extra care. There is no cooling off for a publicly advertised auction, and the same loss of cooling off can apply if you sign within three clear business days before or after the auction date.

You also cannot assume the contract will become subject to a building inspection after the hammer falls. At auction, you generally buy on the displayed contract. If you are the highest accepted bidder, you sign then and there, with the conditions already set.

That makes a building inspection before an auction the safer path if you are serious about bidding. Yes, it can sting to pay for a report on a Preston unit or a Yarraville weatherboard you do not win. It is still cheaper than winning and later learning that the stumps, roof or subfloor needed major work that the shared report only hinted at.

What should you do before you sign or bid?

Use the agent’s report as a lead, not as your shield. Read it carefully, then decide what extra checks you need before you commit.

A sensible Melbourne buyer’s checklist looks like this:

Order your own building inspection if you are serious about the property. Choose the inspector yourself and ask whether they carry professional indemnity insurance.
Ask whether the report will be prepared in line with AS 4349.1 2007, especially if you may need to rely on GC21 in a private sale contract.
Get a separate pest inspection, because termites and other timber pests may not be fully covered in a standard building report.
Send the contract and Section 32 to your conveyancer before signing. Ask whether the building report condition is active, whether the pest report condition is active, and whether any special condition changes your rights.
Treat vague wording as a warning light. Phrases such as ‘further investigation recommended’, ‘limited access’ or ‘monitor movement’ should lead to questions, not comfort.
Check the official due diligence checklist themes as well, including owners corporation issues, flood or fire risk, permits, services and insurance for recent works.

The aim is not to make every property perfect. Older Melbourne homes often have wear, movement, damp patches or maintenance needs. The aim is to know what you are taking on, what it may cost, and whether the contract lets you walk away if the issue is serious enough.

Are vendor paid building reports becoming law in Victoria?

Not yet. In March 2026, the Victorian Government announced a plan to develop a mandatory pre sale building and pest inspection scheme, with vendors arranging reports and making them available before sale.

The proposal is expected to be developed with industry consultation and legislation introduced in 2027. The government has also said buyers would still be able to organise their own separate inspections.

That last point matters. Even if vendor paid reports become part of Victorian property sales, the safest report is still one ordered for you, by an inspector you choose, with duties and insurance clearly connected to you. For now, treat the agent’s report as information that may help you ask better questions. Your own report is the one that should guide your decision to sign or bid.

Frequently asked questions

Can I rely on a building report from the real estate agent?

Treat a building report from the real estate agent as background information, not full protection. It was usually commissioned by the vendor or a report sharing platform, and the report terms may say only the named client can rely on it. If you want an independent report prepared for your benefit, order your own inspection before you sign or bid.

Does the agent’s building report give me the right to cancel the contract?

Generally, no. In Victoria, the standard building report condition only helps if the relevant box in the particulars of sale is ticked and the report meets the contract requirements, including the 14 day timeframe and major defect wording. An agent supplied report is unlikely to be enough by itself, and auction purchases usually do not give you a post auction inspection escape.

Does a Section 32 have to include a building inspection report?

No. A Section 32 vendor statement must disclose the matters required by the Sale of Land Act 1962, but a general building condition report is not usually one of them. Building permit information and owner builder documents can matter in particular cases, but buyers should not expect a full pre purchase building report to be included.

Should I get my own building inspection before an auction?

Yes, if you are serious about bidding. Auction contracts in Victoria are usually unconditional, and there is no cooling off at a publicly advertised auction or within three clear business days before or after it. Your own pre auction inspection is the building check that can guide whether you bid, how high you go, or whether you walk away.

How much does a building and pest inspection cost in Melbourne?

A combined building and pest inspection in Melbourne commonly costs a few hundred dollars, with larger, older or more complex properties costing more. A shared report may be cheaper upfront because several interested buyers can access the same report. The cheaper option is not always the safer one if you cannot clearly rely on it.

What if the agent’s building report missed a serious defect?

Your options depend on the report terms, the contract, the conduct of the parties, and when the defect was discovered. Platform terms and inspector disclaimers may limit who can rely on the report, and visual inspections usually exclude hidden defects. In serious cases, misleading conduct or other legal issues may need to be considered promptly, so get tailored advice before settlement if possible.

About the Pearson Chambers Conveyancing team

Pearson Chambers Conveyancing is a Melbourne focused conveyancing team helping Victorian buyers review contracts and Section 32 vendor statements before they sign. We work with first home buyers, investors and home movers across private sales, auctions, units, townhouses and established homes. Building report questions come up in our day to day contract reviews because buyers need to know whether the protection they think they have is really in the paperwork.

Sources we consulted

Talk to Pearson Chambers before you sign

Been handed a building report by the agent and not sure where you really stand? Send us the contract and Section 32 first. Pearson Chambers Conveyancing offers a complimentary Section 32 contract review, and we’ll explain whether the inspection protections you are counting on are actually in the contract.

Email contact@pearsonchambers.com.au.

General information only, current as at the date of publication. Victorian conveyancing rules and legislation change frequently. Please contact the Pearson Chambers Conveyancing team for advice on your specific contract.