Couple made an offer to buy their first home. Then they learnt the building report had been doctored
The first sign that something might be wrong with the house Estelle Forrest agreed to buy in May was the phone number of the inspector who prepared the construction report given to her by the real estate agent. One number had been changed.
The young mother and her husband Josh had told the agent they would make an offer on the Mooroolbark townhouse, subject to financing and a building and pest report to check for defects.
But their agent at Okas Real Estate told them via text message that the seller had “already prepared a building and pest inspection report and was seeking offers, ideally with minimum terms.” He said the April 2026 report was prepared by an independent, licensed building inspector.
The representative texted that he would be “happy to share the report when you make an offer.” The Forrests were told it had been commissioned by a previous potential buyer whose financing had fallen through.
The couple agreed to remove the zoning report requirement in their offer for the house, which they thought was built around 2020, and they were sent a 72-page document.
Some real estate experts have suggested that the state government’s cost-saving scheme for potential buyers under which sellers have to submit construction reports could put home buyers at risk.
The plan would require sellers to issue inspection reports, pay for them and provide them to all potential buyers, saving up to thousands of dollars.
In the research conducted by the non-profit Consumer Policy Research Center in 2022, some Victorians are paying for seven such reportsThey believe they absolutely need these before bidding at auction, often only to discover that they have wasted their money due to excessively low bidding.
“We were looking for [for a home] Estelle Forrest, who works in tourism services, said: “I have had to use the Help to Buy scheme since the beginning of this year as there was no other way to buy a house.”
“Our daughter is eight months old and we needed to find somewhere we could afford and that would take care of us as a young family. We found this property and what really drew us here was that we thought it would be low maintenance and wouldn’t require major repairs.”
On the fifth page of the report they sent, under the summary of major defects and safety hazards, it was written: “CONCLUSION: No major defects found.”
“The seller accepted our offer,” Forrest said. “A few weeks later… I tried calling the builder who had prepared the report.”
When the inspector found the correct phone number, he explained that he did not have the full report. Original detailed major flaws. He bought the book from her for $395 and it “showed that pages were missing”.
Major defects highlighted in the original include excessive moisture in the building’s subgrade, which “has the potential to cause major structural defects… which can lead to fungal rot, mold and foundation problems,” as seen in this byline.
The inspector originally concluded: “The incidence of major defects in this residential building is HIGH compared to similar buildings.”
In the document forwarded by the representative, both the summary of defects and hazards and photographs and details of the subfloor were removed. The horrified couple tried to cancel the sale, but the seller’s lawyer threatened them with penalty interest and a rescheduling fee if they delayed.
Vishal Safi, director of Okas Real Estate, accepted this credential He said the reports didn’t match but he had no idea what happened. After the questions on Friday AgeHe intervened to end the contract and return the Forrests’ deposits and apologized in writing to the couple on Saturday.
He said he would appoint an auditor to review how the original 75-page report was altered.
Leading buyer advocate and Australian Property Investment Professionals executive director Cate Bakos said it showed risks she was aware of from agents in the ACT, where sellers are already required to submit building reports.
“I’ve talked to sales reps who say they’re going to hang around until they get a building inspection report that looks a little more palatable. They can get as many reports as they want,” he said. “You can always find a building inspector who is a little more laid-back.”
Bakos, a former president of the Australian Association of Property Buyers’ Agents, said: “I am extremely opposed to this new process” and said the government should focus on eliminating underpricing.
“Investigators and agents will get closer to each other. Agents will be the source of their work, and agents will say: [to vendors]’Let’s do this’ [finding a building inspector] It’s part of our process.”
Such familiarity can lead, for example, to reduce major defects to minor defects: “If a dodgy agent knows a building inspector who tends to be a little more lax, he will recommend him.”Age It does not suggest that Okas Gayrimenkul or Safi used a lax or overly privileged construction inspector in this case.
“Low pricing creates a disadvantage for buyers who invest in the process,” Bakos said. “The government thinks it’s removing the $800 barrier to bidding, but instead it’s creating a false sense of security. Good guys [agents] “They are very worried about this.”
Jacob Caine, president of the Real Estate Institute of Victoria (REIV), said the Forrests case “demonstrates the observations and analysis we have put to the government” about the protections needed under the proposed plan: because it will become law In 2027.
The group made 13 recommendations to the government to “try to clean up and make the auction system more transparent and reliable in buying and selling property in Victoria”, including what is required in the new construction reporting programme.
He said the legislation should include additional licensing and certifications and penalties for construction inspectors “to deter these abusive, unethical and illegal practices.”
No home buyer should have the biggest purchase of their life ruined by deceptive and illegal behavior, a Victorian government spokesman said.
“Our reforms will make sellers responsible for inspections to save buyers time and money, and provide safeguards and strong penalties for those who break the law,” the spokesman said.
Under the Sale of Land Act, sellers and agents are prohibited from making or publishing any statement that they know to be misleading or deceptive, or knowingly concealing any material fact, such as awareness that a previous test or investigation has revealed a defect or pest infestation. Violations carry a maximum penalty of more than $48,000 or up to 12 months in prison.
Professional conduct obligations apply to estate agents when providing information to buyers, and engaging in misleading or deceptive conduct is an offense and subject to severe penalties under Australian consumer law.
REIV has previously recommended to the Victorian government that the provision of a building and pest inspection report by an authorized registered inspector be included in the Section 32 seller declaration, with the cost to be borne by the ultimate buyer. It had suggested exemptions, including for properties less than seven years old.
But Jacob Caine, while doing live interviews about the proposed plan, said he was concerned about receiving feedback calls from building inspectors who said some in their industry were unreliable and warned of “shabby operators.”
“The building inspection industry itself has identified that it has a problem; they need to address it as an industry, just as the real estate industry needs to address the parts of it that are underpricing,” he said.
Erin Turner, executive director of the Consumer Research Policy Center, said the new plan will benefit buyers; 17 percent of them think they can’t afford or don’t have time to get a construction report, and another 17 percent pay for reports on seven or more properties.
He said it was often first home buyers who were affected by poor practices in the property industry and the proposed scheme would make such an important purchase safer.
“This [mandated building reports] What is currently missing is really important protection; “We know this will particularly help first home buyers,” he said, but clear consequences need to be included as well as strong protections against fraud.
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Wendy Tuohy is a senior writer who focuses on social issues and issues affecting women and girls.Connect with: X or email.
