Should I Have A Home Inspection?

Over the past few years we saw many buyers waive their home inspection option or have a large allowances for defects (a dollar amount of defects they’d ignore). This was due largely to the fact there was so much competition among buyers that a buyer had to make their offer more appealing to a seller who was able to take their pick of offers. I’ve heard horror stories of buyers closing on their dream house and then realizing it needed quite a few major repairs. This situation is obviously less than ideal and thankfully the market has calmed enough that most buyers are doing inspections again.

In most cases a buyer should get a home inspection. Any experienced home inspector has seen many issues over the years and will recognize a significant problem that a buyer or agent may not notice (even though we are pretty good at spotting these things after attending 100’s of inspections). Most buyers aren’t very educated on the construction processes and techniques – or home maintenance for that matter (aside from our following of engineer/architect clients). While an inspection may not catch every little flaw with your house, most inspectors will find any major costly issues. They will also help educate you on things to do to maintain your home or items that need attention with seasonal change. An inspector might also advise on long term budget items (for example, you may need a roof in 5-7 years). In many cases an inspector will find just minor items that often aren’t even worth negotiating, but we had a recent inspection that saved the buyer from some major repairs ($35,000+). A few hundred dollars for an inspection is certainly worth the cost savings, peace of mind, and education.

What if you are buying a new home? Does that really need an inspection? After all, the city inspectors have taken a look at everything (supposedly) and approved it for an occupancy permit. Yes, even on new construction we’d advise inspections. I have seen some serious issues come up in new construction. We’ve seen flashing missing in places that would have caused a water problem. We’ve seen attic insulation completely missing (forgotten). Inspectors have also found a bunch of smaller items on new construction such as gutters not pitched properly, decks not to code, reverse polarity outlets, ungrounded gas pipes, etc.  Most new homes will include a builders warranty to take care of some of these things. However, it’s a whole lot easier to get your builder to fix these before you close, once they have their money you suddenly become low priority on a builder’s to do list. Some inspectors offer a new construction discount or can do a streamlined check list rather than a full report, because these are often easier inspections, but it’s a good idea to have an inspection.

I’d be a hypocrite if I didn’t tell you, I don’t have inspections on most of the properties we buy for Badger Real Estate Investments. Why? We try to buy with cash and no contingencies to make the seller want our offer so bad that they give us a better deal. Most of these properties are fixer uppers that I plan to renovate and improve anyway. I usually have a significant budget planned for repairs and renovation. Lastly, I was formerly licensed as a home inspector and my education is in architecture and engineering. So, I feel like I’ve got a really good idea of what I’m getting into. I’m the agent walking through a showing with a buyer and pointing out things wrong with the house. I feel like I talk more buyers out of homes rather than into homes, but I certainly miss things too (especially in the timeframe of a quick showing). On a duplex we just bought, I discovered somebody had bumped a car into the garage wall which shifted a couple studs of a load bearing wall off the sill plate. Whoops! Thankfully it didn’t break the budget, but it did take time to repair. If I had taken the time to go through with an inspector, it certainly would have been caught prior to closing.

The bottom line is, I wouldn’t advise skipping the inspection for any retail buyer. Unless you are an experienced investor willing to take more risk for more profit potential, get an inspection. It’s an added measure of security and protection for a buyer that can offer them an opportunity out of their purchase contract (or at least the opportunity to negotiate a repair) if a significant issue is found. If you end up in a competitive situation, and choose to skip the inspection to have an advantage, that’s your decision, but you need to own that decision, don’t expect to come back on your agent or the seller. I would strongly advise all traditional home buyers get an inspection!

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