HoldwellProperty
Guide · Updated October 2026

Due diligence on an established house: the complete checklist

Most bad purchases weren't unlucky. Something was knowable before exchange and nobody looked. This is the checklist we work through on every established house, in the order it happens.

By Nick Khzouz · 12 minute read

Stage 1: Before you inspect

Half the work happens at a desk, before anyone drives out. If a house fails here, you've saved a Saturday and a building inspection fee.

Check Where to look What you're looking for
Sales history Listing portals, CoreLogic or HTAG property reports What it last sold for, when, and how often it changes hands. Frequent resales can mean a problem owners keep discovering.
Comparable sales Sold results within the last 6 to 12 months, same pocket, similar land, size and condition The price range the market has actually paid. This is the basis for a walk-away price.
Rental appraisal Two or three local property managers, plus recent leased listings A realistic weekly rent, not the optimistic number in the brochure.
Zoning and overlays The state planning portal: NSW Planning Portal Spatial Viewer, VicPlan in Victoria, PlanSA in South Australia, and the council planning scheme in Queensland Heritage, flood, bushfire, vegetation, road widening or other overlays that limit use, renovation or insurance.
Easements and covenants A title search (your conveyancer can order one early) Sewer or drainage easements under the house, rights of way, or covenants that restrict building.
Council DA history The council's development application tracker Approvals for extensions, decks and granny flats. Also any refused or current applications next door.
Flood and bushfire Council flood studies, state flood portals, bushfire prone land maps Whether the lot is affected, and whether insurance will be available and affordable. Ask an insurer for a quote before you offer.
Aircraft noise ANEF contour maps published by each major airport Whether the house sits under a flight path or inside a noise contour.
Mine subsidence (NSW) The NSW Planning Portal Spatial Viewer shows Mine Subsidence Districts If it's in a district, building work needs Subsidence Advisory NSW approval. Your conveyancer can check that existing structures had it.
Nearby developments State major projects registers, council DA trackers, infrastructure announcements Rezonings, high-density proposals, new roads or rail that change the street for better or worse.
Crime and demographics State crime statistics, ABS Census data, HTAG demographic layers Owner-occupier share, public housing share, income levels and trend, not a single snapshot.

None of these is a verdict on its own. A flood overlay on the back corner of a large lot might be fine. A sewer main under the kitchen probably isn't.

Stage 2: At the inspection

Our inspection checklist is built to use on your phone while you walk through. It covers the street at different times of day, the roof line, cracking, water damage, the switchboard, drainage, and the questions to ask the agent.

Three things to add while you're there:

  • Photograph anything you're unsure about. Your building inspector can then check it specifically.
  • Ask for the contract on the spot. In most states the agent should have it, or be able to send it the same day.
  • Note what's been recently painted, tiled or patched. Fresh work isn't a problem by itself. Fresh work in a wet area or over a ceiling is worth a closer look.

Stage 3: The contract and vendor disclosure

Every state requires the seller to disclose certain things before you're bound. What's disclosed, and what you can do if it's wrong, differs by state. Have a solicitor or conveyancer review the contract before you sign or bid. Rules as at October 2026:

State Main disclosure document What it includes
NSW Contract for sale with prescribed documents attached Title documents, a drainage and sewerage diagram, a section 10.7 planning certificate from council, and pool registration and compliance documents if there's a pool.
VIC Vendor's statement (Section 32) Mortgages, easements and other restrictions, improvements, planning controls, and rates and taxes. Must be given before the buyer signs.
QLD Seller disclosure statement (Form 2) under the Property Law Act 2023, in force from 1 August 2025 Title and registered plan, encumbrances, zoning, heritage, rates, whether there's a pool, and certain government notices. Must be given before the buyer signs. If it's missing or materially wrong, the buyer can generally end the contract before settlement.
SA Vendor's statement (Form 1) Title details, mortgages, easements and encumbrances, zoning, outgoings, and building compliance matters.

Victoria is changing. From 16 October 2026, auctions and fixed-date sales need a published reserve price and a Property Price Statement. From 1 June 2027, the Section 32 must be available at least 14 days before an auction, or within 14 days of a private sale being advertised.

Cooling-off periods

State Cooling-off Cost to withdraw When it doesn't apply
NSW 5 business days from exchange 0.25% of the price At auction, on the day of a passed-in auction, or if waived with a 66W certificate
VIC 3 clear business days after signing The greater of $100 or 0.2% of the price At public auction, or within 3 clear business days before or after one; buyers that are companies or agents
QLD 5 business days from receiving the contract signed by both parties Up to 0.25% of the price At auction, and some private contracts just after a passed-in auction
SA 2 clear business days from the later of signing and receiving the Form 1 The seller can keep up to $100; the rest of the deposit is refunded. Confirm with your conveyancer At auction, or if waived with a solicitor's certificate

The key point: there's no cooling-off at auction in any of these states. If you're bidding, every check in this guide has to be done before the hammer falls.

Stage 4: Professional reports

Report When What it tells you
Building and pest Every purchase, before exchange or within the cooling-off period Structural defects, moisture, roof condition, termite activity and damage. Read the full report, not just the summary.
Pool compliance If there's a pool or spa Whether the barrier complies. In NSW the contract must include pool documents. Fixing a non-compliant fence can be your cost after settlement.
Strata report Not relevant for freestanding houses on their own title Mentioned only because some "houses" are townhouses or villas on strata or community title. Check the title type.
Surveyor If boundaries look wrong, fences are off line, or structures sit near the boundary Whether the house, garage or extensions encroach on a neighbour, or theirs on you.
Electrical or plumbing Older homes, or if the building report flags it Cost to rewire, replace old pipes or fix drainage.
Asbestos Homes built before about 1990 with original sheeting or eaves Not always a reason to walk away, but needs to be costed before any renovation.

A building report finds problems. It doesn't price them. If it flags something significant, get a quote before you negotiate.

Stage 5: If the house is tenanted

A tenant in place can be a good thing: rent from day one. It also means you inherit someone else's lease and someone else's paperwork.

  • The lease. Start and end date, rent, any special terms, and whether it's fixed term or periodic.
  • The rent ledger. At least 12 months. Look for arrears or recent rent changes.
  • The bond. Confirm it was lodged with the state authority (NSW Fair Trading, the RTBA in Victoria, the RTA in Queensland, CBS in South Australia) and will be transferred.
  • The entry condition report. You'll rely on it at the end of the tenancy.
  • Current rent versus market. Rent well above comparables can mean the tenant is about to leave.
  • Minimum standards. Check the house meets the state's rental standards, or price in the work.

Rental laws have changed a lot and keep changing. As at October 2026: NSW ended no-grounds evictions from 19 May 2025. Queensland's minimum housing standards apply to all tenancies. South Australia's rental laws were overhauled from 1 July 2024, including minimum housing standards at the start of a tenancy. Victoria has existing minimum standards, with new energy efficiency standards (heating, cooling, hot water, ceiling insulation, draughtproofing) phasing in from 1 March 2027. A house that needs insulation or a new heater to be leased legally has a cost the brochure won't mention.

Stage 6: Finance and insurance

Formal approval, not pre-approval. Pre-approval is an indication. Formal (unconditional) approval comes after the lender has valued the property. In NSW the standard contract usually has no finance clause, so the cooling-off period is often your only window. In other states a finance clause is common, but check the date in it. A mortgage broker can tell you where you stand.

Valuation shortfall. If the bank values the house below the price you agreed, the lender lends on the lower figure and you fund the gap. A bank valuation is not a market price, and neither is any estimate on a website. If your offer is at the top of the comparable range, have a plan for a shortfall.

Insurance. When the house becomes your risk depends on the state and the contract:

State Usual position
QLD Usually the buyer's risk from 5pm on the next business day after the contract date
SA Usually the buyer's risk once both parties have signed
NSW and VIC Generally the seller's risk until settlement or possession, though many buyers insure from exchange

Your conveyancer will confirm what your contract says. When it's your risk, have building insurance in place from that moment, and landlord insurance from settlement if it's an investment.

Stage 7: The numbers

A house can pass every physical check and still be a poor purchase for you if the numbers don't hold. Before you exchange, know:

  • Total purchase cost: price, stamp duty, legal fees, inspections, lender costs.
  • Weekly holding cost after rent: interest, rates, insurance, property management, maintenance, land tax if it applies.
  • A buffer: for vacancy, a rate rise and an unexpected repair, at the same time.

As an example only: a $650,000 house with a 20% deposit, a 6.2% interest-only loan and rent of $560 a week costs about $248 a week after rent and running costs, before tax. That's a gross yield of 4.48% and a net yield of about 2.98%. Your own numbers will differ. Run them in the cashflow calculator.

Tax matters more than it used to. For established residential property acquired after 7:30pm AEST on 12 May 2026, from 1 July 2027 rental losses can only be offset against residential property income and gains, with unused losses carried forward. From 1 July 2027 the 50% CGT discount is replaced by an inflation-indexed cost base, with a 30% minimum tax rate for resident individuals (the gain taxed as the last slice of income). Assets held before 1 July 2027 are treated as sold and reacquired on that date, keeping the old discount on the gain to that date. Qualifying new builds can choose either treatment. Properties owned before 12 May 2026 keep the old loss treatment. Your accountant can tell you how it applies to you. More in the 2026 tax changes guide.

Red flags that should stop a purchase

Some problems can be priced. These usually can't, or not without more time and advice than a campaign allows:

  • Structural movement the building inspector can't explain, or recommends an engineer for.
  • Active termites or significant past damage without a treatment and repair history.
  • Unapproved structures (a granny flat, enclosed garage or extension) with no council approval and no plan to fix it.
  • An easement or sewer main under the house that limits what you could ever do with it.
  • A flood or bushfire overlay where insurance quotes come back unaffordable or declined.
  • Disclosure that's missing, late or wrong, or a seller who won't allow a building inspection.
  • Rent that only works at the top of the market, or a tenant in arrears.
  • Comparable sales that don't support the price, and an agent who can't explain the gap.
  • Pressure to waive cooling-off or exchange before reports are back.

If you find yourself explaining away the third red flag, the house has already answered the question.

How Holdwell does it

We work through these stages on the houses we put to clients, alongside your solicitor, inspector and broker. A few parts are specific to how we work:

  • The pocket check. Before a house goes to a client, we test the pocket around it: a hexagon of a few hundred homes. A good suburb can have a weak pocket (a main road, a flood-affected strip, or a high concentration of social housing that thins the resale market), and the pocket is what a future buyer actually sees. How we choose suburbs and pockets explains the method.
  • A walk-away price, set before we negotiate. It comes from comparable sales and the defects we've found, not from the asking price or how much we like the house.
  • A written limit. The client approves the property and signs a written limit before we make an offer or bid. It's one of the three decisions in our process, and it stops anyone (including us) getting carried along at an auction.

Every stage is reported in a weekly status update, so nothing is decided on a phone call you have to remember. The full process is on How we work.

This checklist doesn't replace a professional building and pest inspection, legal review of the contract by a solicitor or conveyancer, lending advice from a mortgage broker, or tax advice from an accountant.

Sources

General information only. Nothing on this site takes into account your objectives, financial situation or needs, and it is not financial, credit, tax or legal advice. Past performance is not a reliable guide to future performance.

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