Settlement day is exciting. After all the contracts, the waiting, the stress and the paperwork, you are finally about to get the keys to your new home.
But before you pop the champagne, there is one more step that a lot of buyers treat as a formality when it is actually anything but.
The final inspection.
Done properly, it protects you. Done carelessly, or skipped entirely, it can leave you holding the bill for someone else’s mess, broken appliances or unfinished business.
Here is everything you need to know, in plain English.
⚠️ Quick Note: This article is general information about the final inspection process in NSW. Every contract is different. If you are unsure about anything you find at your final inspection, call us before settlement, not after.
What Is the Final Inspection Actually For? 🔍
The final inspection is your chance, usually in the 24 to 48 hours before settlement, to walk through the property and confirm two things:
✅ The property is in the same condition as when you agreed to buy it
✅ Everything included in the sale is still there, working and the property is vacant
That is it. Those are the two jobs. Simple in theory, but there is a lot hiding in the detail.
Step 1: Test Absolutely Everything 🔌
Do not be polite about this. You are about to hand over a significant amount of money. Test every single thing you can get your hands on.
Here is your checklist:
| What to Test | Why | |
|---|---|---|
| ❄️ | Air conditioning and heating | These are expensive to repair or replace, test every unit, every mode |
| 💡 | Every light switch | Including outdoor lights, garage lights and any sensor lights |
| 🍳 | Oven, cooktop and rangehood | Turn every burner on, check the oven heats, run the rangehood on all speeds |
| 🚿 | Hot water | Run a tap until it goes hot, do not just assume |
| 🚰 | All taps and toilets | Check for drips, leaks, water pressure and that toilets flush properly |
| 🚗 | Garage door and all remotes | Test open and close, check the remotes actually work |
| 🏊 | Pool equipment | Run the pump, check the filter, test any heating or automatic cleaners |
| 🔔 | Alarm and intercom | Check you have the codes and that the system is operational |
| 🌀 | Any included appliances | Dishwasher, washing machine, dryer, if it was listed in the contract, test it |
Why Does This Actually Matter?
If something is broken and you do not raise it before settlement, the vendor can, and often will, argue that either it was already broken when you bought it, or that it is now your problem.
But if you find it before settlement, while you still have leverage, you can:
Ask for it to be repaired or replaced at the vendor’s cost
Negotiate a price adjustment with the agent
Delay settlement (with legal advice, more on that below)
Finding a broken rangehood after you have settled is an inconvenience. Finding it before is a negotiation.
Step 2: Check the Property Is Actually Empty 📦
This sounds obvious. You would be surprised.
Vendors sometimes leave things behind, intentionally or otherwise. Old furniture, boxes in the garage, building materials under the house, rubbish in the yard, a shed full of stuff they “meant to move.”
Your contract entitles you to vacant possession, meaning the property should be empty and available for you to use.
But here is where it gets a bit nuanced.
What “Vacant Possession” Actually Means in Plain English
Courts do not expect the property to be surgically clean. What they care about is whether you can actually use the property.
The legal test is whether what has been left behind creates a “substantial impediment”, which is lawyer speak for: does it seriously prevent you from using, accessing or enjoying a meaningful part of the property?
✅ Minor stuff (usually not enough to delay settlement): A few leftover timber off-cuts under the house. Some rubbish bags in the side passage. A handful of items the vendor forgot. Annoying, but courts generally treat these as inconveniences, not breaches.
❌ Major stuff (more likely to be a real problem): A basement packed so full you cannot access it. A garage completely blocked by furniture. An entire room of rubbish that makes it unusable. These are more likely to be considered a genuine breach of vacant possession.
The key questions courts ask are:
What is it, how much of it is there, and where is it?
Does it make a room, garage, cellar or other significant area actually unusable?
Is it a physical issue, or a legal one, like a tenant who refuses to leave?
If the Property Is NOT Vacant at Your Final Inspection 🚨
Stay calm. You have options. Here they are, from least to most dramatic:
| Option | What It Means | |
|---|---|---|
| 1️⃣ | Ask the vendor to remove it before settlement | Often the simplest solution, the agent calls the vendor, the stuff disappears |
| 2️⃣ | Request a holdback | An agreed amount of money is held back from the vendor’s proceeds to cover removal costs |
| 3️⃣ | Delay settlement | Only with legal advice, an unjustified delay can put YOU in breach of contract and cost you money |
| 4️⃣ | Settle and claim costs later | Sometimes an option, but slow, expensive and not guaranteed |
⚠️ Important: Do NOT decide to delay settlement on your own. An unjustified delay can trigger penalty interest or put you in breach of contract. If you are genuinely concerned about what you find at the final inspection, call us before you do anything.
Real NSW Cases – What Courts Have Actually Decided ⚖️
For the curious among you, here is how NSW courts have handled these disputes in real life:
Rubbish in a disused swimming pool (Berrell v Combines Pastoral, 2015) The vendor left rubbish and building material in an old unused pool. The court said it was not a substantial breach, the pool was not in use and the contract had a “present condition” clause. Buyer had to settle.
Concrete blocks and materials under the house (Nelson v Bellamy, 2000) Building materials were left under the house and in an alleyway. The court called it messy, but not a substantial impediment. Settlement went ahead.
Rubbish and a potential price reduction (Segal v Osborne, 2016) This case explored whether a buyer could get a purchase price reduction under the Conveyancing Act 1919 (NSW) due to rubbish left behind. The outcome highlighted how important the wording of your contract is, another reason to have a good conveyancer review it before you sign.
💡 The Pattern: Courts consistently focus on whether the issue is serious enough to prevent use, not just whether it is inconvenient or untidy. Minor mess loses. Major blockages can win.
Before You Decide to Delay Settlement, Think Through This 🤔
Delaying settlement feels like a powerful move. But it comes with real risks.
Ask yourself these questions before you do anything:
| Question | |
|---|---|
| 1 | Will it seriously affect your ability to use the property or is it just annoying? |
| 2 | What will a delay cost you? (Think: penalty interest, extended bridging finance, removalist rebooking fees) |
| 3 | If this ended up in court, is the issue serious enough to win? |
| 4 | Have you actually spoken to your conveyancer before making this call? |
If the answer to number 4 is no, that is your first call to make.
The FAQs Nobody Thinks to Ask Until It Is Too Late 🙋
Q: Can I take photos during the final inspection? Absolutely, and you should. Date-stamped photos of anything you are concerned about are useful evidence if a dispute arises later. Document everything.
Q: What if an appliance worked at the time of signing but is broken now? This is exactly the kind of thing to raise before settlement. If it was working when you signed the contract and it is broken now, the vendor has an obligation to address it. Do not assume it is your problem, call us.
Q: What if the vendor’s furniture is still there but they say they will pick it up after settlement? Get this in writing before you settle, and make sure the arrangement is formally documented. Verbal promises about “picking it up next week” can evaporate very quickly once the vendor has their money.
Q: What if a tenant is still living in the property? This is a serious issue. A tenant who has not vacated can legally prevent you from taking possession, and that is considered a breach of vacant possession regardless of how tidy the place is. Call us immediately if this is the situation.
Q: Can I refuse to settle if I find something I do not like? Maybe, but only if the issue is serious enough to legally justify it. This is not a decision to make on your own. Call us first.
The Bottom Line 💬
The final inspection is not just a box to tick on your settlement checklist. It is your last opportunity to protect yourself before ownership transfers.
Walk through slowly. Test everything. Take photos. And if something is not right, call your conveyancer before you decide what to do next.
At Milana Law, we are with you right through to the moment you pick up those keys. If something comes up at your final inspection, we want to hear from you before settlement, not after.
Talk to Milana Law, We Actually Pick Up the Phone 🤝
✅ We walk you through the final inspection process before it happens
✅ We are available when something comes up at the last minute
✅ We advise you on your options before you make any decisions
✅ Fixed fees, no surprises – Queensland and NSW
Contact Milana Law today, let us make sure settlement day goes exactly the way it should.
Milana Law | Queensland & NSW Property Law | milanalaw.com.au