It promises to be the Uber-X of the property market – sharing the costs of building inspection reports – and now companies are jostling to be the ones providing the reports ahead of a NSW government review of the issue. Some inspection firms already have systems in place to share reports, for a discount, among prospective buyers while an increasing number of real estate agents are now also getting in on the action. Michael Ferrier, founder of Eyeon, a web-based report-sharing service, says he wants the state government to back a sharing system so that consumers can have confidence in reports originating from any source, including vendors. “We recognised there’s a problem in having potential buyers all having to commission, and pay for, building, pest and strata reports, whether or not they’re successful in buying,” he says. “So we’ve taken a business direction of designing a model and investing in a platform to host shared reports to make it much fairer in the marketplace.” Under Eyeon’s system, the vendor pays a discounted fee to have all necessary reports done, which are then put on the company’s website for potential buyers to buy at a rate about 20 per cent of the normal cost – $99 for house building and pest reports, and $69 for strata reports. Alternatively, all buyers pay the full price for the same report where the vendor hasn’t contributed to the cost, but then the ones who don’t succeed in buying receive a rebate. As revealed exclusively in Domain this week, Minister for Innovation and Better Regulation Victor Dominello​ had floated the idea of multiple prospective buyers accessing one authoritative inspection report, saving on unnecessary costs. “When you go to an auction, there may be a dozen bidders, especially in a hot market, but only one winner,” Mr Dominello told Domain. “The people who didn’t win then have to do it all over again on the next property they bid for.” Many firms are, however, rushing to institute their own systems of sharing reports. One major supplier of building inspection reports in Australia, Jim’s Building Inspections, keeps an eye on properties being put up for sale and then often does its own reports which it sells for half price online to anyone interested in buying that property. “Generally, it averages out that we sell about 2.5 reports for every property,” managing director Paul Commerford​ says. “It works in Sydney the best as people seem to be very open to it. Our record has been selling one report 12 times but, then again, sometimes we might have no buyers at all for some property reports.” In addition, real estate agencies are beginning, more and more, to commission their own reports to help buyers – and their vendors – to seal deals. Most sell the reports for less than the price of commissioning them, in the hope of multiple report sales. Agency BresicWhitney, however, commissions reports from independent inspectors and then supplies them for free to all potential buyers through its website. “We decided to do it as a service to our buyers to make it much easier for them,” director Nicholas McEvoy says. “The reports are independent so they know they can be trusted – the owners often don’t even see them – and it can save buyers thousands of dollars if they keep getting inspections done then missing out on properties. Buyers love the system; it’s brilliant.” There have been other attempts to share building reports among purchasers but many buyers are understandably wary about the source and therefore the reliability of any building reports they get. “It is hard to distribute reports to potential buyers as the system has to rely on real estate agents,” says Ged Gillmore, who launched ReportShare in 2014. “Sometimes trust became an issue among clients.” Eyeon’s Ferrier recognises the concern but says his company’s reports are completely independent and, once the credibility of report-sharing is established, like the rise of Uber as an alternative taxi service and Airbnb for holiday rentals, report-sharing will become the norm, rather than merely a cheap alternative. “We guarantee the independence of our reports [building, pest and strata] and all reports are accessed directly from our website,” he explains. “This service isn’t just about the report. It’s also about follow-up support for buyers.” In the ACT, vendors are required to provide potential buyers with inspection reports which the ultimate purchaser later pays for. If they find out later that the report failed to reveal a problem that costs them time and inconvenience, whoever prepared the report has to pay compensation. However, Ferrier believes that puts the onus back on the buyer to prove the report was inadequate after the event, while others have questioned the level of qualifications of some of the property inspectors there. Dominello’s department is said to be considering a scheme whereby one person commissions a report but, through a separate agency, other potential buyers can buy a copy of it, lowering the cost for all parties. “We want something that is independent and works in the purchasers’ interests,” he said. The principle of report-sharing has already gained support from the real estate industry. “Exactly how it should be structured is a secondary issue,” NSW Real Estate Institute chief executive Tim McKibbin says. “But the institute supports the information being provided in a shared way to make sure everyone can make informed decisions about property buying.”
There is new competition in the Australian property market among platforms who provide building inspection reports for potential property buyers, thus helping people share the costs of reports. Michael Ferrier, Founder of Eyeon, a web-based report-sharing service, wants the government to support this sharing system to help give consumers more confidence in the system. The report will be made available on www.myhome.vic.gov.au and can also be downloaded from the website at http://bit.ly/1kq7mHG. Ferrier believes that once the credibility of report-sharing is accepted, report-sharing has the potential to rise like Uber and Airbnb to become the norm.