Nothing says “Happy New Year” better than a blog on home inspections.
Uh. Wait. That’s not really a thing, is it? But it probably got your attention.
We don’t exactly know why, but just the word “inspections” causes palms to sweat, hearts to race, and jaws to clench among buyers, sellers, and a lot of agents.
We are here to say this: in the New Year 2021, let us all resolve to embrace the home inspection process as one more educational tool in the real estate tool-box to help improve all homes on the market. Let us stop the madness and declare a moratorium on inspection paranoia.
Inspections are one of several contingencies written into most purchase agreements. Buyer and Seller negotiate how many days after acceptance of the contract the buyer has to order inspections and submit the response to inspections if the buyer wants repairs made. The purchase agreement outlines the scope of the inspection as well as whether the buyer will be inspecting for specific biological contaminants. It gives the buyer options for how identified defects will be remedied and how the seller can respond. Previously identified defects as specified in the Residential Seller’s Disclosure are not a reason to terminate an agreement, as are items of “routine maintenance and minor repairs…mentioned in any report.” Defect is even defined in the purchase agreement:
“Under Indiana law, “Defect” means a condition that would have a significant adverse effect on the value of the property, that would significantly impair the health of safety of future occupants of the property, or that if not repaired, removed, or replaced would significantly shorten or adversely affect the expected normal life of the premises.”
Inspections are meant to be educational: a way for you to learn about how the house works and what you need to be aware of when you take possession. Keep in mind that a homeowner can get a home inspection at any time Have you lived in your home for 15 years with no plans of leaving?: it is not a bad idea to get a fresh set of eyes on the hidden systems of your home to make sure you aren’t sitting on a disaster waiting to happen. Maybe you are preparing to list your home and you want to minimize buyers’ objections and budget for repairs to figure into your bottom line. These are very legitimate reasons to get an inspection from a licensed professional.
Deals have been known to fall apart over inspections, but this is definitely the exception and not the rule. With the right real estate agent by your side, sellers and buyers can both make rational decisions about inspections when they are educated right from the very beginning of the transaction process. For sellers, this means that the agents start talking about inspections even before the listing agreement is signed. Buyer’s agents should start talking to their clients about inspections as soon as they walk into their first showing. Setting expectations for all parties is key to navigating the inspection process.
There is no such thing as a perfect house. Even new construction will turn-up things on an inspection report: that is the inspector’s job and that is why we pay them. But the number one reason for getting an inspection is NOT to find out what is wrong with the house. Inspections are educational and they are the best way to LEARN about your house, how the major systems work, and how to care for it.
The number one reason that people dread inspections is because they go into them thinking that they are doing them for the sole purpose of finding all of the things that are wrong with the house; that they are going to find something (or somethings) that is going to “kill the deal” or devalue the house. Most of the time this is simply untrue. The inspection process does represent a secondary negotiation in the home buying process, but by this point, most buyers are already in love and excited about the home and most sellers are packing-up more boxes. The mortgage process and title preparations are in motion; and REALTORS® are thinking about closing gifts and thank you notes. EVERYONE wants things to go smoothly.
The great thing about hiring a licensed home inspector is that they have absolutely no skin in the game. You pay them to be an objective third party. Inspectors don’t make the repairs, so they don’t make any money off of finding things that aren’t up to code or are in a state of disrepair. It is essential, however, that the inspector you choose is appropriately trained and licensed. Qualified inspectors have a state license and should have a certification from ASHI (American Society of Home Inspectors) and/or InterNACHI (International Association of Certified Home Inspectors).
If you are a homeowner, keep up with routine maintenance and hire professionals when necessary. If you are thinking of selling, get an inspection prior to even calling a real estate agent so that you aren’t surprised by unexpected repairs when you find that perfect buyer. Also, a pre-inspected house is an attractive house. The buyers could still ask for their own independent inspection, but both parties can go into the inspection negotiations with lessened anxiety.
Buyers…concentrate on the items that have a large impact on the value, life and safety of the home. Rely on the insight and advice of your real estate agent when it comes to translating the report. Remember that your agent is your trusted advisor, and they see all types of home inspection reports every year and can help you negotiate the repairs that mean the most to you. TRUST THEM when it comes to the inspection process.
