Your building inspection report came back. It's 95 pages. There's termite evidence, a cracked slab edge, deteriorating mortar, and the electrical isn't to current spec. What number do you put on all that?

Most Australian buyers either don't negotiate (leaving $20–80K on the table) or pull a number out of thin air (which the vendor's agent shoots down). Here's how to do it properly.

Step 1: Classify every defect into a negotiation bucket

Your inspector's defects fall into three negotiation tiers:

Tier A — Hard negotiation items

Tier A items demand specific dollar negotiation backed by inspector evidence. Vendors expect to compensate or rectify these.

Tier B — Maintenance backlog negotiation items

Tier B items individually look small. Bundle them. Three Tier B items × $4K each = $12K of negotiation room hidden as "just maintenance."

Tier C — Vendor will push back hard

Tier C items are real but vendors will refuse to discount on them. Use them as throwaway gives — drop them in the negotiation in exchange for a bigger concession on Tier A.

Step 2: Put a dollar figure on every Tier A + Tier B item

Your inspector probably WON'T have given you costs (AS4349.1 doesn't require it). You need to do this yourself OR use a tool like Report Decoded that estimates AU repair costs by defect category.

Some rough Australian benchmarks for typical Tier A defects:

These are 2025–2026 Australian rates. Coastal properties + heritage properties typically run 1.5x–2x higher because of corrosion-grade materials + heritage-spec replacement rules.

Step 3: Build your negotiation number

Add up all Tier A items at the midpoint of each repair-cost range. Add 50% of your Tier B total (vendor will haggle you down to roughly half). This is your starting ask.

Example: $750K Yarraville cottage with deferred maintenance:

Starting ask: $62,250 off contract price. Realistic landing: $40K–$55K.

Step 4: Write the actual negotiation letter

The vendor's agent will assess your seriousness by HOW you present the negotiation. Two emails get totally different responses:

"The inspection came back with a few issues. We'd like to negotiate $50K off."

vs:

"Following the AS4349.1 inspection completed [date] by [Inspector Pty Ltd, licence #1234], the following major defects were identified on pages 12, 18, 24, 41, 52, 67, and 81 of the attached report: [bulleted list with estimated repair costs]. Total documented rectification cost is $62,250. We are formally requesting a price reduction of $50,000, bringing our offer to $700,000. We are in a position to exchange promptly if we can reach agreement."

The second one gets taken seriously. Report Decoded auto-generates this letter from your inspection PDF, including the page citations. Copy-paste-send.

Step 5: Know your walk-away number

Before you send the negotiation letter, decide: what's the LOWEST discount you'll accept and still proceed? What's the maximum rectification cost you'd swallow personally to get the property?

Most buyers fail here. They negotiate from emotion ("we love this house") without setting a walk-away. Vendor smells it and refuses. Set the line BEFORE you negotiate.

Tips that matter

What about new builds (PCI / handover)?

New-build practical completion inspections work differently. You're already in contract with the builder. You don't negotiate price down — you require the builder to rectify the defects before sign-off, using the Defects Liability Period (DLP) clause in your contract.

Report Decoded generates a Builder Rectification Letter instead of a Negotiation Letter when you select "new build / handover" at upload. It cites every defect against the relevant Australian Standard breach so the builder can't hand-wave away items.

One more thing

The single most common mistake: buyers either don't negotiate at all (leaving $20K–$80K on the table on a typical $1M+ purchase) or they negotiate too aggressively without evidence (vendor refuses, buyer either capitulates or walks).

Evidence-led negotiation almost always wins. Your inspector did the hard work — finding the defects. Your job is to translate that into a dollar number, document it, and put it in front of the vendor in a way they can't dismiss.

That's exactly what Report Decoded does in 2 minutes for $59. But even if you do it manually using this guide, the principle is the same: specific defects + specific pages + specific dollar amounts = serious negotiation.