Pre-Home Inspections: What Every Seller Should Consider !
Chris and I are Realtors so our opinion is obviously one from that perspective. But, that perspective was pierced last year when we helped my mother sell our family home of 35+ years located in Bucks County. It was a really slow market at that time and we wanted to sell the home in a few months rather than the average 6-8 months it was taking other homes to sell. So, my perspective as "just another Realtor" faded fast since this was the home I spent my formidable years growing up in and there were many memories embedded into every square foot.
Collectively we agreed that the old house was very well maintained but it certainly needed some repairs.Therefore, we thought it would be a great idea to get a pre-inspection to get a good overview of what we might be up against when a buyer got their own independent home inspection. We did not want any surprises.
We got the inspection done and decided to repair many of the small items that popped up and adjust the price of the property to compensate for some of the items we were not interested in replacing or repairing. We decided not to use our home inspection as a marketing tool in the advertising though we could easily have done so. That was not our goal in getting the pre-inspection. We did it for our own information and for disclosure purposes.
The home went pending in 3 weeks in a slow market and settled in less than 45 days at a great price. I attribute that success story to the decision we made to get the pre-inspection. It eliminated the "fear of the unknown" regarding repairs and allowed us to confidently and intelligently price and sell the property fast.
Every seller in this Real Estate Market, whether it be in Philadelphia, Bucks County Pennsylvania, or anywhere across the country should consider doing a pre-inspection prior to selling their home. In fact, every Realtor representing a seller should consider introducing that option to their seller clients.
Pre-inspections are beneficial and should be considered by every seller because:
1) Pre-Inspections remove the fear of the unknown
2) Pre-Inspections create a platform for realistic pricing from the start
3) Pre-Inspections provide a real advantage when used to increase marketing appeal
The bottom line is information helps empower one to make informed decisions. If interested in additional information regarding selling your home, please contact The Somers at thesomersteam@yahoo.com.
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It also indicates to the Buyer that the Sellers "care" enough. Here in our TX contracts, when a request is made for repair, it has to be done by a license professional. If the pre-listing inspection is done prior, then the Seller could have saved himself some money on hiring a handy man for simpler jobs.
Good post, Steph!
We agree with you....however...this is not yet the "typical" practice in our area....soooo....it is best here at this time, not to say...the inspection has already been done by Joe.....too many people are suspicious that Joe is your Uncle, cousin, brother...but you are correct....we do this and explain what has been done to get the house ready for the market.
Absolutely, positively this is a win-win for everyone involved. !
Preinspections are the best way to get the buyer comfortable when making an offer. I have an offer on a short sale that we inspected before making an offer. Our offer came in higher as a result.
This is a great idea and as you mentioned could be used as a marketing tool as well.
It's a great idea I have done it a few times, however sometimes I find the buyers inspector then picking at those items because you know they have to find something wrong with a house to justify their fee or at least they do in Florida.
Now with the move-in certified inspections where the inspector can come back after the repairs are made and update their report. It would of been an added bonus as you could of marketed the home as move-in certified, which I've noticed homes sell faster than ones that are comparible
Loreena - Very true. There are several benefits to this strategy for sure.
Janice - Agreed. A "win-win" creates a no-brainer. I think it is even more important for those homes that have not been inspected in decades.
Kay - The more knowledge and info, the better ! As the chance for surprises are diminished.
Thank you for your post. I agree that getting the sellers to have a home inspection is a great idea. The sellers I've gotten to have one done have also been willing (almost anxious) to get most of the things taken care of. That absolutely does raise both confidence in and knowledge of the home, which is evident in the future discussions about it. Just like keeping the home clean for showings, it does show buyers that the sellers care, which is always a good thing.
Bruce
Congratulations on the feature! We moved to Tucson from the greater Philadelphia area, and gladly concede to you the cold and the snow. Of course, where are we celebrating Christmas? Snowy Prescott & Flagstaff, AZ!
Mike in Tucson
Is a great idea, but very few sellers embrace it. I think over the last year I have had four Pre-Home Inspections that came from people that either used my services in the past or family members wanting to sell they home more quickly. In my area this idea just has not caught on so far.
Excellent Post Guys ! I had two of these done for owners in the last few months, and both turned up things that we took care of before listing, and both sold in 30 days ! It definitely helped !
Good post but I am still of the opinion pricing matters more than anything else. If you are priced to high good luck.
I am especially on this is I see something significant in the structure. I will recommend a licensed engineer to evaluate.
Lots of benefits to pre-inspection! Any defects in a property which are properly and completely repaired do not have to be noted on a NC Residential Property Disclosure Statement. When a major defect is uncovered after a home goes under contract it frequently ends up with the buyer asking the seller to renegotiate a selling price that may have already been heavily negotiated or even loss of the contract.
It is important to remember that any inspection, either pre or post contract, is only a snapshot in time and does not ensure that the buyers inspector will not find other issues. Sellers who desire a pre-inspection should never be encouraged to believe that nothing will come up on the buyers inspection. (Yes, even when a seller provides an inspection I counsel my buyers to get their own inspection.)
Some caveats; if your seller chooses to offer a home warranty, some warranties have conditions that would exclude anything found in a pre-inspection from coverage for the buyer. Likewise, a defect uncovered in a NC pre-inspection and NOT repaired would most definitely need to be disclosed before a contract is written.
My feeling is that, like anything else, pre-inspections are not always a "do it" or "don't do it" proposition...an in depth conversation with the seller and a complete visual inspection of any property I list will influence the recommendation I give!
One of my team members did this when she put her home on the market in Ann Arbor. She had lived there 20 years, and found mold in the attic, they were able to get it mitigated and it was not an issue during the sale.
It was not a usuable attic, so they had no clue.
I am a big fan of pre-inspections for homes older than 10-15 years. It is much easier and a lot of times cheaper to get the work done before hand. Here in the Indianapolis market, you see a lot of buyers asking for an allowance for repairs after closing that is usually a lot higher than what it would cost under normal circumstances. A lot of first time buyers want to use you the big name company because they are under the impression that they are the best just because you see them everywhere. I can usually point my clients to professionals who do great work for less money.
I am getting ready to list my home in February and will be having a home inspection done prior. I will fix probably more than is needed because once under contract, I don't want anything out there that is questionable.
Excellent points! Over the years I have grown to share your opinions on pre-inspections. Because inspections as becoming so tedious and even a part of the loan process, it is so much better to do a pre-inspection and get the repairs done before a listing goes on the market.
Very good points to consider. I have not been a big proponent in the past since most sellers are a little reluctant to spend non-required funds upfront, but certainly could prove to be a good investment if it uncovers a potential deal breaker.
It baffles me that this is not done more and have yet to hear a satisfactory reason as to why the practice is not just part of the whole process.
Great post! Isn't it amazing how a personal perspective on selling a home can be so different than our professional one? Congratulations on getting your childhood home sold quickly.
Thanks for bringing this up. I have been an advocate of this for many years, but because most Realtors do not encourage this in our market, it has been a challenge to get the Sellers to spend the additional funds. Being able to price the home correctly, making the Sellers aware of any potential repairs, and cost, puts them in a much stronger position and eliminates surprises at the end of the transaction. I think this is one of the best marketing tools you can have,- "disclosure based on recent independent home inspection".
Thanks for bringing this up. I have been an advocate of this for many years, but because most Realtors do not encourage this in our market, it has been a challenge to get the Sellers to spend the additional funds. Being able to price the home correctly, making the Sellers aware of any potential repairs, and cost, puts them in a much stronger position and eliminates surprises at the end of the transaction. I think this is one of the best marketing tools you can have,- "disclosure based on recent independent home inspection".
Another great tip courteous of A/R. Thanks for sharing.
Another good reason is the rediculous items FHA appraisers are now requiring to be repaired before closing. I've had sellers that have come down pretty good on the home and agreed to repair items from the inspection only to have the FHA appraiser come through and request another $500 to $1,000 in repairs for the loan. You can never eliminate everything but its a good start. The $250-$400 for inspection is well worth avoiding the headaches of doing it after the contract has been accepted.
I think this is generally a good idea. However, in Oregon if you've had a home inspection done in the last two years, the buyer may request a copy. This then becomes an issue for buyers who may attempt to use the home inspection to nickel & dime the sellers on everything in the home inspection before they invest any money in the transaction, just to see if they can get everything under the sun done to the home.
It is always great to find any surprises before hand as well. We all know how buyers will use the home inspection as a 2nd round of negotiations!
In Missouri, we are required to have a home inspection if a Realtor owns even a fraction of the home. I have to do this on my Mother's home because I have inherited 1/4 of the home. I do intend to bring this option up to sellers more often. Many times they are willing to spend the money on a Home Warranty, I have had some instances where the $$$ might have been better spent on Pre-inspection.
It looks like pre-listing inspection are popular with the AR real estate community, but we just don't see them being done in the home inspection community!
This year I will do right at 284 home inspections, I'm sitting at 281 and I have 3 on the schedule before the end of the year. With that said I think I have done 2 pre-listing inspections this year. That is just not that many when you look at how many I have done for the year. I really think that my figures are similar to other inspectors across the country.
It has been my experience that homeowners just do not want to spend the $350+- or whatever to findout what is wrong with their home. Most homeowners feel that nothing is wrong with their castle that they have been living for years. In today's market when the dollars are already tight, I just do not see folks spending the money on pre-listing inspections. Don't get me wrong I would love to see it happen, but we just need to look at the economics.
Then we have the buyer to consider.....
If I were buying a home that had a pre-listing inspection done on it, I would want to have my own home inspection done on it. Why some might ask?
The above are some reasons that I have done inspections for buyers when the home has had a pre-listing inspection.
This is a very positive thing to do, espically on a older home. It is a plus for the seller if they can set a buyers mind at ease during initial stages. We recommend inspections even on new construction as well. I have a couple of true stoeies that happened with new homes. Our buyers inspection revealed some hidden things that really threw up a red flag on the quality of all the work done.
This is a great recommendation for the seller. It really does help with pricing especially if it is an older home and brings most if not all issues to the surface ahead of time.
Chris and Steph: I look forward to the day when all sellers do a pre-inspection. I would add to your list that it improves the negotiation power of the seller. Great post.
Hi guys, how's the weather? I think this is a good idea and down the road it could become the norm. I did hear of a seller who was advised to get a pre-inspection done by his Realtor, fixed all the issues, then the buyers inspector did an inspection and found more stuff to fix and so he was ticked off because he had to pay for those items also.
Unfortunately most people are so cash strapped they don't want to even consider it. But on a home ten years or older I would want to know first. Knowledge is Power!
I agree with Scott Paterson comment, he mention that buyers are more apt not to find comfort in the sellers choosing to get an home inspection. I have recommended the sellers that I work with to get a pre-inspection many times its the cost the prohibits the excution.
Thanks for the comments on this everyone. I think like everything else, knowledge is power. And this type of information can help a seller decide what to ahead of time before putting their property on the market and help with pricing in addition to disclosure. We would always recommend that a buyer get their home inspection as well. And in many cases, it is often best to not do this step. However, I think it is important to consider depending on the situation of the house, the seller and so forth. In our specific case, the information that my mother-in-law received ahead of time was well worth it as she had a lot of stress and anxiety about the unknown. The pre-inspection helped to alleviate a lot of that. ~ Chris
I have an inspector that I have used that will do the inspection and then places the inspection online so the buyers can access it. He places a sign in the yard stating the hjome has been inspected and it includes the URL to the inspection report. It is a good selling point.
I couldn't agree with you more regarding pre home inspections. most sellers already know what it wrong with the home but they don't always know the new codes, and all buyers get worked up when they hear the term "it's not up to code" from the inspectors.
I couldn't agree with you more regarding pre home inspections. most sellers already know what it wrong with the home but they don't always know the new codes, and all buyers get worked up when they hear the term "it's not up to code" from the inspectors.
The problem with this is that home inspectors are not inspecting for code compliance, most of the time. Code compliance is really for new home construction or remodels that have permits.
I would say that 95% of the older housing stock is not code compliant in some aspect. Heck even many new homes are not code compliant!
I totally agree that pre-inspections are the way to go. I had a client sell a home that I had managed for 5 years that he inherited from his father. He did considerable cosmetic work prior to our placing it on the rental market and when it came time to sell it, I urged him to have a pre-inspection BEFORE he had it appraised. He chose not to, established the contract price based on the appraisal and then got hit with substantial inspection repair cost.
It makes lots of sense, especially for homes where there is deferred maintenance, the homeowner has lived there for a long time, etc. Grat conversation here with lots of justification provided to support making this decision early on.
Jeff
Stephanie & Chris, great post! It does make a lot of sense, and it may become practice sooner rather than later. It definitely helps -- and the buyer can still choose to have an inspection if they don't want to trust the report outright. This way the sellers are aware of what is happening rather than being in the dark and hit with repair costs later!
I agree and I firmly believe if sellers would do a pre listing inspection would save them a lot of heartache down the road.
I try to at least get a termite report .
Knowing exactly up front what is going on and needs to have attention does help in selling a home.
The contract can always be written to allow the buyers to obtain their own further inspections at buyers expense to rest their mind at ease.
If a conflict arises between inspectors and reports can be dealt with much easier.
Unfortunately a lot of sellers do not even have the money for inspections in todays market ........
So this is where in our contracts inspections can be part of a contingency period and open the door to further negotiations for credit towards repair etc and/or additional credit towards closing costs as the buyer lender will allow and/or a possible reduction adjustment of the original purchase price amount.
Excellent Blog Stephanie! More and more agents, sellers and buyers are seeing the benefit of a Pre-Sale Home Inspection. As you experienced first hand, it is truly a WIN WIN for all parties in the real estate transaction. I re-blogged your info, adding my support!
Timely post for ME. I'm getting ready to put my home on the market. I bought it in 1998, but it has been rented out the last 4+ years. Home was built in 1929, so I suspect some of the electrical wiring will have to be updated. Heat and air was reported as new when I purchased it, but so was the roof -- the THIRD layer. I know a Buyer will fall in love with its location and charm, but don't want them to be frightened by a horrible inspection report - so, I will inspect prior to listing!
Great for buyers and sellers. Stay ahead of the game. Stand out from the competition. I will definetely add it as an option to my sellers presentation.
Great for buyers and sellers. Stay ahead of the game. Stand out from the competition. I will definetely add it as an option to my sellers presentation.
Christopher & Stephanie,
Thanks for the post. Great points. This practice of incorporating a pre-listing inspection has always given the seller a competitive edge. Not to mention the opportunity to correct any deal breaking issues.
I agree with you 100% on this. The listings I've had in which a pre-sale inspection was done always yielded fewer surprises and less conflict in the end. Great reminder!!
love the idea of a pre inspection but many sellers do not want to spend any money and it is quite a delima...
your friend in Charlottesville Virginia!
Excellent point! I believe any non-distressed homeowner should consider the pre-inspection. Unfortunately, for the many short sale sellers in our market here in the Phoenix area, this is not a very realistic option.
I think pre-inspections are a great idea in a slow market, and really helpful in any market.
Why not have a home inspection done. It is informative and helpful. You can ward off any potential "issues that might be negotiated" down the road when marketing your home. It's worth it!!
Patricia /Seaacoast NH
So what do you do when your home inspection discovers stuff that the owner fixes and then the buyers home inspector discovers all the stuff the still isn't fixed?
Great input Chris and Stephanie! You are so right!
DeeDee
Getting a pre-inspection is a great thing for the seller. This will identify any thing that may need a little attention and prevent an issue once the home is sold and the buyer has an inspection and everyone is supprised at what may show up.
I know one agent who convinces her clients to have their homes pre-inspected, repaired, appraised, and have a one-year warranty. She has branded this as making a WISE purchase and her name is, of course, "Wise". In this market, it makes a lot of sense to set your home apart from the many others for sale with a strategy that takes as much risk as possible out of the purchase for the buyer. Sharing the inspection report and appraisal with buyers creates a sense of openess and transparency that can also be helpful in the transaction. Of course, this strategy works best with a well-maintained home and with first-time homebuyers.
My clients just recently got their property pre-inspected. I encouraged them to do so. The tangible reasons? It is 20+ years old, and there was a draft in the kitchen that they were afraid would mean major repairs. The less tangible reasons? It allows them to price their property confidently; it removes the anxiety that comes when the buyers will inevitably want to do their own inspection; it puts everything on the table up front, versus when we've got an accepted promise to purchase (with a condition for home inspection by the buyers) and emotions are running really high; it shows that these sellers are on the ball, open, not playing games, and really care about the "quality" of their property. All of which puts us in a position of strength when dealing with buyers. Great post, Stephanie & Chris! And all the best to you in 2010. -- Tanya in Montreal
On thing I would add here. If you get a pre-inspection, make sure that the inspector tends to be one of the more "critical" inspectors. If the first inspection is by an inspector who lets many things slide -- and some do -- then there may still be surprises when the real buyer inspection takes place. But, either way, it should be better as a result of the first inspection.
Disclosures regarding property conditions seem to be a pretty popular subject right now. I think proper disclosures are a great marketing tool for the sellers given the many many issues and unknowns that homebuyers are rapidly gaining knowledge of when viewing properties.
Pre-Inspections remove the fear of the unknown-You are so right Christopher and Stephanie. Congratulations on your Gold star. Great post.
Good post and congrats on the feature (I am reblogging).
I wish more sellers around here would do this, but with our average sale under $100k and the average home inspection at $300-400, we rarely see sellers willing to do this before hand. They'd rather take the risk.
I am in full favor of it, and would do it if I was selling my own home.
Wow! This is such a great post, and I will use your arguments in my listings. I'm amazed at how many sellers balk at my suggestion of getting a pre-inspection. They don't want to pay for it. But it ALWAYS ends up costing them MORE money because they are under a time limit and a microscope when they get those buyer-demanded repairs done. Great post!
Like Scott Paterson related some where above pre inspections just do not seem to be very in demand. It makes sense, but what does that really mean? I very seldom do pre sale home inspections.
Stephanie... this is a very smart move and I wish more realtors would suggest this little expense, than just wait for the buyer to decide if they will do one or not. I have seen the process of waiting till a buyer gets one, and then decide if they want to do the work, slow down the whole process... especially after the appraiser goes out there. So this is excellent advice.... nice job.
This is a great post and I couldn't agree more.
This is a great post. I think that way too many times buyers only look at the monthly mortgage payment and fail to account for everything else that goes with home ownership. Principal, interest, taxes and insurance are just the beginning. Whether your a first-time buyer or thinking about moving up, you should plan for extra costs that could add up to thousands each year. Do your self a favor get a home inspection!