Don’t overlook your home inspection. This step of the home buying process is critical to a successful transaction. An important part of the negotiation between a homeowner, who is typically vested in selling a home quickly for the best price, and a buyer, who needs to ensure the home they’re purchasing is well-kept and is worth the asking price, is an independent inspection. A third-party examiner can look at a home objectively, giving all parties clear facts for negotiating a final purchase price and timeline.
However inspection discussions are often more complex than an initial purchase-price negotiation, and because inspections have the potential to raise new legal and heated emotional issues, they come with their own set of best practices. Here are five worth considering as you plan for an inspection on a home.
Hire a pro. If you have any concerns about a home’s integrity, especially a property that may be older to showing concerning signs of physical damage, don’t skip on the depth of your inspection. Some affordable inspections offer a more “surface” review, while others will go into more detail. Make sure you know whom you’re hiring and what the inspection deliverables will be.
Repair or credit? If your contract includes an inspection contingency, you typically have three options:
1) You can ask a seller to fix items that an inspection shows are in need of repair;
2) You can ask the seller for a credit to compensate you for future repairs; or
3) You can request a hybrid of these two options.
Typically there are a few days on each side for the buyer to make requests and for the seller to counter. Because buyers are in control of this part of the process, they can’t lose the opportunity to purchase the home if they request repairs and they can use the inspection results as a motive to terminate a purchase agreement.
Stick to the facts. There is no way around it: Home buying is an emotional, stressful process heightened by serious financial implications, intense deadlines, significant legalities, and the inevitable issue of falling in love with a home before you know its bones. The best way to protect yourself as a buyer is to stick to the facts as much as possible. Use the home inspection facts to inform decision-making and negotiations, and try to detach as much as possible from the psychological aspects of buying a home. Remember, should the inspection come back with a fatal flaw, there will always be another home. Always.
Focus on big-ticket items. Inspections often reveal a laundry list of items that need attention. However sellers can get testy if they feel “nickel and dimed” by a buyer’s requests or are asked to fix issues that they deem to be standard home-maintenance issues. When negotiating, stick to the “big ticket” items identified by the inspection, including supporting explanations and estimated repair/replacement fees. For example: “Breaker box is a recalled model and represents a fire hazard ($1,800)” or “hot water tank is 15 years old and will likely leak soon, causing water damage to interior ($800).” Stay away from smaller items such as missing smoke detectors, faulty hardware or blocked gutters.
Do it yourself. There are some cases where doing it yourself might be a better option. If an inspection reveals that there’s a significant and costly repair required to maintain the integrity of the home—foundation work, electrical wiring hazards or a roof replacement—it could be smarter to ask the seller to drop the price and complete the repair yourself. Why? Sellers are usually motivated by time. They may agree to a repair but have it done quickly, cheaply and by a substandard or unlicensed person. Another option is to request that the seller complete the repair prior to move-in, using a contractor of your choice.
Inspections are simply part are of the home buying process. The more you can keep this in mind, always looking at the bigger picture, the smoother negotiations will go and the faster you will be able to complete the transaction. Everyone wants a win-win situation, where both buyer and seller feel heard, respected and satisfied.
Of course, one of the best ways to remove the emotions from this stressful situation is to hire a professional real estate agent who can guide you through the entire inspection process. Have more concerns about a home inspection in the Salt Lake City area? A Rize HomeSource home buying pro has answers.