Buying a home is a big financial investment. Given the magnitude of this type of purchase, you’ll want to make sure that you’re buying exactly what you want, which is why a home inspection is so important.
You might be checking out a home in great detail when you attend a showing, but it’s always possible to miss potential issues that may be lurking. With a professional home inspector tagging along, you’ll have an extra set of experienced eyes to help you uncover any problems with the home before you go through with the transaction.
Skipping a home inspection can be risky. Let’s go into more detail about home inspections and why they should be part of your offer to buy a home.
Key Points
- A home inspection is an examination of a home by a home inspector to identify issues before closing.
- Inspectors look at exterior components, interior components, and major systems within a home.
- A home inspection protects buyers by helping them identify issues and make a more informed decision about whether to finalize a real estate transaction.
- Buyers typically order and pay for a home insertion, though sometimes sellers may choose to have (and pay for) a pre-listing inspection done.
What Is A Home Inspection?
A home inspection allows a professional home inspector to scope out the overall condition of a home. The interior and exterior of a home are closely inspected to find any potential issues before a buyer commits to a purchase.
Once the home inspection is completed, the buyer will receive a detailed report on what the inspector found, along with advice on how to rectify any issues discovered.
Is A Home Inspection Required For A Mortgage?
A home inspection is not a mandatory part of the mortgage process. Unlike a home appraisal, a home inspection is typically not a requirement.
A home inspection is designed to protect the buyer. If you’re purchasing a home, it’s in your best interests to check out its condition in detail with the help of a professional. Lenders, instead, focus more on home appraisals, as mentioned, as a way to verify the value of the property that is collateralizing the mortgage.
Why You Should Never Skip A Home Inspection
Your offer on a home should include a home inspection condition to give you the chance to have a professional inspect the property before you commit to the purchase. However, in hot markets where you’re involved in a multiple offer situation, you may not be able to.
This is when you may want to consider a home inspection in advance and not include it as a condition in your offer. That way, you can make a ‘clean’ offer to avoid potentially losing out on your dream home.
There are plenty of reasons why a home inspection should be a part of real estate deals, such as the following:
Budget For Repairs And Renovations
Once your inspector is done with the home inspection, you’ll receive a detailed report outlining all the issues discovered, as well as the type of work required to rectify them. With this information in hand, you can speak with a contractor or other home improvement professional to get an idea of the depth of the work involved and how much it will cost you.
With this figure in mind, you’ll be better able to budget the entire cost of the home’s acquisition. This will help you determine whether the deal is within your financial comfort zone.
Discover Pest Issues
Home inspectors know the tell-tale signs of pest infestation. If there is a pest problem in the home, you can decide whether it’s worth it to go ahead with the deal or walk away.
It’s important to note that a home inspector will only point out certain areas of damage that may have been done by pests. A specialized pest inspector would be required to determine the presence of unwanted pests and the extent of the damage.
Ensure There Are No Safety Issues
There are all sorts of issues that fall under the safety umbrella, such as faulty electrical wiring and mould. While mould and certain other issues fall outside the scope of a regular home inspection, a home inspector can often uncover factors that determine whether the home is a potential danger zone.
Identify Illegal Installations And Additions
Ideally, any home renovations conducted by the seller would have been done with a building permit in hand. Local jurisdictions require building permits to ensure the work is up to code. This is mainly for safety reasons, as faulty installations and shoddy work can compromise the integrity of a structure.
Permits will also ensure that the work being done doesn’t infringe on the enjoyment and rights of your neighbours. If the work done on the home is illegal, you could eventually be on the hook to pay to have the work brought up to code or taken down altogether.
Insurance Companies May Request It
Not all insurance companies request a home inspection. But some might, especially for older homes or ones not recently inspected.
At the end of the day, a home inspection will protect you as a buyer. A home purchase is a significant financial commitment. You want to ensure you know exactly what you’re buying before you sign on the dotted line.
What Does A Home Inspector Look For?
During a home inspection, the inspector will inspect three major categories. This includes the exterior of the house, the interior of the house, and the inner workings of the house (electrical, heating, plumbing and ventilation).
Exterior Of The House
The home inspector will perform a visual inspection of the exterior of the house by looking at the following:
- Roof
- Downspouts
- Exterior walls (including foundation wall)
- Driveway
- Decks and patios
- Outdoor railings
- Windows and doors
- Greenery
Interior Of The House
Similarly, the home inspector will also examine the interior of the house by looking at the following:
- Floors
- Walls
- Ceilings
- Windows and doors
- Bathroom fixtures, plumbing, and cabinets
- Kitchen fixtures, plumbing, and cabinets
- Appliances
- Countertops
- Attic
- Foundation
- Stairways
Inner Workings Of The House
Included in the interior inspection is the examination of the following:
- Plumbing pipes
- Electrical panel and wiring
- Insulation and ventilation
- HVAC system
Learn the risks of an unconditional offer when buying a home.
What Does A Home Inspection Not Cover?
Based on the above list, a home inspection covers plenty of things. However, there are several important factors that a regular home inspection will not cover or go into detail about, including the following:
- Pest infestations
- Underground septic systems
- Sewer lines
- Chimneys and fireplaces
- Detailed roof inspections
- Hazardous substance (ie. mould or asbestos)
- Pools
If any of the above components concern you, you can bring in an expert in a specific field to take a closer look before you finalize a deal. Just make sure you make proper arrangements with the seller.
Further, it’s important to understand the limitations of home inspections, as there’s only so much an inspector can do. For instance, they cannot see what’s behind walls or under floors.
Home Inspections Vs. Pre-List Inspections
As the name suggests, a ‘pre-list inspection’ is an inspection of a home before it’s listed for sale. Sellers may choose to have their home inspected before putting it on the market so they can find out if anything is wrong with the home. This way, the seller can fix any issues or at least have an understanding of what issues exist before putting their home on the market.
Who Benefits From A Pre-Listing Inspection?
A pre-list inspection benefits both the buyer and the seller:
Benefits For Buyers
Pre-listing inspections benefit the buyer because the seller may pay to fix some repairs before listing the house. Therefore, the buyer will have fewer repairs to deal with. Furthermore, if the pre-list inspection uncovers any serious problems that a buyer does want to deal with, they will know before they pay for their own inspection.
Benefits For Sellers
Pre-list inspections help sellers discover any issues before a buyer becomes aware of them. That means there won’t be any unpleasant surprises after a potential buyer’s home inspection is conducted. Sellers may also fix any issues uncovered from a pre-list inspection before listing. Or, they may consider these issues to come up with an appropriate listing price.
Who Pays For Pre-Listing Inspections?
A pre-list inspection differs from a home inspection because it’s the seller paying for it, not the buyer. With a traditional home inspection, the buyer orders the inspection to be done and hires the inspector without the seller’s involvement and covers the cost of the inspection.
Ultimately, the pre-list inspection is done for the seller and the seller pays.
Should You Skip A Home Inspection In A Hot Market?
Even in a hot real estate market, a home inspection should not be skipped. If you’re concerned that your offer will be weakened with a home inspection condition, consider asking the seller to have an inspection done before the offer date.
Competitive Offers May Skip Inspection Conditions
To be competitive in a hot housing market, you may consider making a ‘clean’ offer, which contains no conditions, including a home inspection condition. However, while this may be more attractive to sellers, it leaves you more vulnerable as a buyer.
While you want your offer to stand out, weigh the risks of skipping the home inspection. There’s a chance you could be left with several problems to deal with once you seal the deal.
Pre-Listing Inspections May Help
Multiple offer situations are typical in a hot market. Sellers often set their listings up for such a scenario. In this case, sellers may be willing to agree to pre-listing inspection requests for serious buyers.
Ideally, the seller will already have a pre-listing inspection done and can provide you with the report before you put in your offer.
Request To Conduct An Inspection Before Making An Offer
If the home you’re interested in doesn’t already have a pre-listing inspection, consider asking the seller if you can perform a home inspection before you put in an offer. That way, you can submit a clean offer free of conditions and the home can be sold ‘firm’ on offer night.
Just keep in mind that in a hot market where sellers may be fielding offers from multiple buyers, they may not be as interested in letting you inspect before making an offer.
What Happens If A Home Inspection Turns Up A Big Problem?
If your home inspector’s final report identifies major issues with the home, you have options:
Bring In Another Expert
For starters, you can ask to have other professionals brought in to inspect the issues of the home. For instance, if it’s an electrical issue that was uncovered, you may want to bring in an electrician who can more accurately diagnose the problem before you proceed with the deal.
Negotiate A Lower Price
You can use the home inspection report to support your request to have the seller lower the purchase price to accommodate the cost of repairs. This tactic should only be reserved for major issues that will be very expensive to fix, not for minor problems that will only cost you a couple of hundred dollars.
Ask The Seller To Fix The Problem
If the seller agrees, the problem may be fixed before you even move into the home.
Walk Away From The Deal
If the problem with the home is so significant that you are uncomfortable, you can walk away from the deal without repercussion. As long as you do so before the home inspection condition expiry date.
Final Thoughts
You’re spending a lot of money to buy a home, so you want to ensure you’re not taking on more than you bargained for. That’s precisely why a home inspection is so important and why you shouldn’t skip it when buying a house.
