The real estate market is one of the fastest moving in our country’s history, and although there are signs it may be slowing, I’m not holding my breath.
Right now, sellers are in charge, and know it. They have the luxury to be uncompromising in what they want for the homes, both in price and terms.
This, in turn, helps fuel bidding wars on homes in good condition and located in decent areas.
Getting swept away in a multiple offer situation is common, so be on guard. It’s ok to compromise on less important aspects of the purchase, but you may want to consider any decision to waive the home inspection.
What a Home Inspection Won’t Do
Just as a professional home appraisal won’t let you know about the problems with a home’s systems, a professional home inspection can’t determine a home’s market value.
Not directly. It may impact the value if something major comes to light, but it isn’t something a lender requires before lending money for a home.
Because a home inspection is visual, it won’t give a potential buyer any information or anything that may be hidden behind the walls or beneath floors. It won’t tell a homebuyer if there are dangerous levels of toxins in the air, such as radon.
The inspector will look at the home’s roof, structure and major systems, such as electrical, heating and cooling, ventilation and plumbing. Even among these items, if there is a defective part or component that can’t be seen with the naked eye, it won’t end up in the report.
The home inspection is also not a guarantee that the home will be in the same condition when you take possession as it was when the inspection was performed. Anything can happen between those two periods.
What a Home Inspection Will Do
Most of all, a home inspection provides the homebuyer with at least some peace of mind.
Inspectors who are worth hiring are those who have extensive experience and know the signs of hidden problems. They don’t hesitate to recommend additional inspections by a specialist.
For instance, if he or she notices evidence of wood destroying pests, such as termites, she may recommend that you have the home looked at by a pest inspector.
Should you Skip the Home Inspection?
In a multiple offer situation, with price and all other terms being equal, the offer from a buyer who waives the home inspection is most likely going to be the one the seller chooses.
If you have a hefty home maintenance or emergency fund, it’s worth considering waiving the inspection contingency. If not, doing so is a gamble.
Buying a home without having it checked out by a qualified inspector is the same as buying a home as-is. Understand that you may be buying someone else’s problems.
This isn’t the same as buying a used car as-is because the potential problems you inherit with a home can cost into the tens of thousands of dollars.
A home inspector can’t possibly tell you about all of the problems a home has, or is about to have. But, the peace of mind that you’ll get with at least knowing that the home’s major systems are in working condition is something to carefully consider before giving it up.
To see a comprehensive list of common repair items, click here.
So let me end with this thought. The national average cost of repairs for items found in a home inspection is about $5k. If this amount is not going to hurt your wallet, you may want to consider absorbing it to reduce friction with seller. And it may help you win the bidding war!
