The photograph depicts a timber rot in a joist under the bathroom, a commonly found issue when inspecting under the house.
Inadequate water proofing of wet areas carried out during construction is the main reason for these leak defects. This defect is one of the most prevalent in Victoria.
The costs to repair these defects ranges from $3000 to $10,000. Its cost depends on the extent of rot to the floor and the floor frame.
It is highly recommended to obtain a pre-purchase building inspection prior to buying a dwelling because once you have bought it, the problems are automatically becomes yours. There is absolutely no way you can oblige the previous owner to pay for repairs.