A Queensland residential property contract contains a building and pest inspection condition. The inspection report reveals significant termite damage. Under the standard REIQ contract, the buyer may:

Q: What is the correct answer to: A Queensland residential property contract contains a building and pest inspection condition. The inspection report reveals significant termite damage. Under the standard REIQ contract, the buyer may:

The correct answer is Terminate the contract by giving written notice within the condition period if the defects are not reasonably acceptable. Under the REIQ building and pest condition, if the inspection reveals matters not reasonably acceptable to the buyer, they can terminate the contract by giving written notice within the condition period. The buyer does not automatically receive a price reduction or have the right to demand repairs.

Q: What background knowledge is needed for this Contracts Conveyancing question?

The REIQ building and pest condition allows the buyer to arrange inspections within a specified period. If results are unsatisfactory, the buyer can terminate. In practice, buyers often negotiate price reductions, but this is done by mutual agreement — not as an automatic right under the condition.

Q: What is a good way to remember the answer to this Contracts Conveyancing question?

Building and Pest condition gives two choices: BAIL (terminate) or PROCEED (accept as-is). No automatic price cut or repair demand. Inspection found problems? The buyer can bail out or proceed — they cannot force repairs or price reductions.

Q: What exam tip applies to this Contracts Conveyancing question?

The building and pest condition is a termination right, not a negotiation right. Any price adjustment is by separate agreement.

Q: How does this Contracts Conveyancing concept apply in Australian real estate practice?

A buyer's building inspection reveals extensive termite damage costing $40,000 to repair. The buyer gives written notice terminating the contract within the condition period. They could alternatively negotiate a lower price, but that requires the seller's agreement.

Question

Contracts ConveyancingQLDHARD

A Queensland residential property contract contains a building and pest inspection condition. The inspection report reveals significant termite damage. Under the standard REIQ contract, the buyer may:

Answer Options

A

Automatically receive a price reduction equal to the repair cost

B

Terminate the contract by giving written notice within the condition period if the defects are not reasonably acceptable

C

Demand the seller fix all defects before settlement

D

Extend the settlement date by 6 months without the seller's consent