When representing buyers, you can use the right home inspections to renegotiate the sales price. I typically get contractor bids to justify my request for a price adjustment when representing the buyer based on inspector recommendations.
It is important to understand the different types of inspections that are available so that you can select the right inspections for the property in question. Home inspections cost money, so they are an investment in the process.
Besides aiding in maintaining a sales price or renegotiating during contingencies, home inspections are also a risk-management must. Buyers who have inspections are less likely to come back and claim an issue was not disclosed. Here are three steps you should take to prepare your clients.
1. Obtain a general home inspection
When hiring a home inspector, make sure you get the very best — the inspector who will find all the issues and accurately describe them. A great home inspector is factual, not alarmist.
I prefer to work with an inspector who is ASHI (American Society of Home Inspectors) accredited and who also trains home inspectors. When you have an excellent and thorough home inspector provide a pre-inspection, you can be pretty sure no new issues will arise should the buyer decide to get his or her own inspection.
The general home inspection should include an assessment of all the systems including the foundation, crawlspace, attic, roof, electrical, plumbing, HVAC, interiors, exterior siding, doors, windows, appliances and framing. In some circumstances, the home inspector might recommend getting a specialist to further evaluate an issue outside his or her area of expertise.
2. Conduct a structural pest inspection
This inspection is completed by a licensed contractor who is certified to perform this type of inspection. A structural pest inspection looks for actual pests such as termites, wood-boring beetles and other insects, plus mold infestations, water damage and dry rot.
Bees, mosquitos and pesky neighbors are outside the realm of the structural pest inspection. Structural pest inspections include a bid for work to repair adverse conditions and often recommendations for further inspections of areas that are inaccessible or outside the expertise of the inspector.
3. Bring out the specialists
Based on the results of the general home inspection and structural pest inspection, you will likely want to order some additional reports from specialists.
These could include inspections of the chimney, drainage, structural engineering, roof, septic, well and more. Sometimes our clients have special needs, and for them, we might need to think outside the box and obtain inspections that aren’t necessarily property-specific but client-specific, such as the paranormal home inspection (may this never happen to you).
Once you have all the inspections in hand, obtain bids from reputable contractors to help you with your pricing if you are the listing agent or with your negotiations if you are representing the buyer.
Although we should always do our best to inspect the homes we sell thoroughly, ultimately, the cost falls on our client, and it’s their prerogative to determine which inspections they want to invest in.
We must always reinforce with our clients that though we do our best to obtain as much information about the properties we sell, some conditions might not be discovered during the inspection process.
Regardless, obtaining the proper inspections is the best way to avoid any future surprises and to make sure your client gets the best possible price at the end of the day.