Why a Home Seller Should Consider Having a Home Inspection Done
This month’s topic: Why a home seller should consider having a home inspection done.
We know this can be a bit of a hot button topic, since disclosure rules require any issues a home seller knows about the home be disclosed to a potential buyer. But before you turn away, take the time to read the perspective of a realtor who does more than 20 million in sales per year, and a nationally known financial expert, both of whom encourage this practice.
From a blog by George Ballantyne of Sotheby’s in Boston: The Home Inspection: The Beginning Or The End
The buyers are ecstatic about the property.
The sellers are looking forward to the next chapter in their lives. There’s been a meeting of minds on price and closing date. All that is left is the home inspection.
It begins with dripping faucets, toilets with broken seals, multiple two prong plugs, missing GFIC [ground fault interrupter circuits], incorrectly wired electric panels, doors that do not latch, windows with broken sash cords, tubs and showers in need of grout, water in the basement, sills that need replacing, a high radon reading, and ends with raccoons in the attic.
The list is overwhelming. The buyer’s dream house is slipping away. The seller’s next chapter is less certain. This is the same house the buyers fell in love with. It is the same location, architectural style, number of rooms and layout as before the home inspection.
Contractors are brought in to give estimates. Everyone has different ideas on what needs to be done. The buyer submits their list. An adjustment is proposed to the selling price. The seller feels the offer they accepted is already a significant concession. The buyer is above their maximum offer. Little movement from either side. Buyers see the sellers as inflexible. Sellers are not sure these are the right buyers. They are the same buyers and same sellers as two weeks earlier. The deal falls apart.
This could have been a sale. What if the seller had done the home inspection prior to listing? What seems overwhelming could have been a simple punch list. Easy enough to have a plumber fix the dripping faucets and toilets. An electrician could update the plugs, add GFIC and properly wire electric panels. The carpenter can take care of the broken sash cords. Radon can be mitigated. The racoons relocated. What may have been a list of 20 items is quickly reduced to five. This sets the tone for a very different negotiation. The buyer’s enthusiasm is maintained. The deal stays on course.
Why don’t sellers do pre-home inspections prior to listing?
We’ve become accustomed to having the buyer do the inspection. Few sellers want to pay for an inspection that the buyer will ultimately pay for. There’s also a bit of the Cleopatra syndrome “Queen of Denial”. From the seller’s perspective everything is in working order. Rather than making the repair, we often adapt our life around what is broken. Buyers have a different expectation. They expect everything to be in working condition. If it is not, it becomes an item for negotiation. The more variables there are in a negotiation, the greater the probability of a sale going astray.
If you’re thinking of selling, consider investing in a home inspection. It’s not a substitute for the buyer’s home inspection but it may be the difference between a sale and no sale.
See more of George’s blog at: http://www.sothebysrealty.com/eng/associate/180-a-962-4017572/george-ballantyne
And from the blog of Dave Ramsay, Financial Guru:
Home Inspection Red Flags for Sellers
According to the National Association of Realtors, even buyers looking for a bargain still pay close attention to a home’s condition before they make an offer. After working so hard to attract buyers with a move-in-ready home, the last thing you want is to lose a sale because your home inspection turns up a red flag. So what’s a savvy seller to do?
Know What You’ve Got Before You Go to Market
Surprises are great—just not when they show up on a home inspection. That’s why it’s a good idea to get your own pre-sale inspection before planting the for-sale sign out front, especially if your home is in questionable condition. A qualified inspector should perform a four-point inspection of the roof, HVAC, basic electrical and basic plumbing to avoid a lowball offer out of the gate.
If your listing agent doesn’t offer a pre-inspection option, be prepared to deal with costly repairs or to lower the price if major issues are uncovered when the buyer conducts their inspection. You may find yourself having to wait until you can afford to fix the problem areas before your home can sell at the price you need to move on.
A major fix may feel out of reach if your money is tied up in equity, but you can still bring options to the table. Why not work with your agent to gather a few professional quotes for the repair and offer cash at closing or a discount on the sales price to cover the cost? Giving the buyer a choice is always a winning approach because they like having control over the outcome. It also shows you’re willing to meet them in the middle.
KEY POINT TO REMEMBER: The home seller can benefit greatly from a home inspection, and save everyone lots of headache. Consider Perkins Home Services for your next home inspection.