Paying for Your Home Inspection?
A home inspection involves hiring an expert to walk through your home and prepare a report. It lists down the home’s main features and amenities, current condition, and aspects that may need revisiting. But should a first-time home seller get a pre-listing home inspection?
Home inspections have been traditionally done at the expense of home buyers. It serves as due diligence on their part to ensure they know what they are buying.
More and more sellers have been doing pre-listing home inspections. The main argument for conducting your own home inspection is you’ll find out any issues your home might have and will have time to fix them before listing or going through negotiations. The primary argument against this is that you might be spending money unnecessarily; especially if you know your home like the back of your hand.
We’ll be exploring the subject in detail below by discussing the two primary pros and cons to pre-listing home inspections. Our hope is this will help you make a more informed decision.
Pro: You’ll Get An Accurate Report On Your Home’s Condition
As a homeowner, I’m sure you are confident that you know everything there is to know about your home. However, you may miss out certain details since you are too close to the subject.
Getting someone with fresh eyes will reveal details that you may have missed. Not only that, home inspectors are trained professionals who know where and what to look for.
Knowing the exact condition of your home will give you time to make repairs and improve the value of your home. It will also spare you from nasty surprises during negotiations if the buyer finds a material defect in your home.
Con: You’ll Get An Accurate Report on your Home’s Condition
Nope, that’s not a mistake. Knowing the exact issues of your home is a double-edged sword since you may now be required by law to disclose all of these defects.
Depending on your state, you may be required to disclose all of your home’s problems to the buyer.
You may be held liable for non-disclosure even in “caveat emptor” or buyer beware states where buyers buy at their own risk.
For example Florida is a caveat emptor state. Ryan Barnett, principal broker at Market Connect Realty in Florida, shares a 1985 Florida Supreme court ruling that effectively puts the onus on Florida homeowners to reveal known defects.
Disclosure won’t really affect you as much if you have the money for repairs. if not, then it will be more difficult to sell your home.
For every defect, buyers will lower their asking more than a defect’s repair cost. This has the potential to lower your profits especially if you can’t address these issues.
Pro: Smoother Selling Process
Having all information at hand will allow you and your realtor to set a good listing price for your home. Setting a home’s price is both an art and science. Price it too high and your home can be in the market longer than it should be. Price it too low and you’ll be leaving money on the table.
You wouldn’t be worried too much during negotiations because you and your agent will know the buyers’ points for negotiations ahead of time. Armed with all the knowledge, a good agent will use this as ammo for marketing and to get more during negotiations.
Pre-inspection reports may also give buyers more confidence in your home. Buyers do not want surprises as well. You may avoid negotiation entirely, and the stress associated with it, if you have a willing buyer who loves your property even after reading the inspection report.
Con: Unnecessary Cost
For all its benefits, you will have to shell out around $250 to $1,000 for an inspection.
There might be additional tests costs on top of that base price such as testing for radon, mold, asbestos, and lead. All these will easily double or quadruple the inspection cost, not to mention the cost for repairs.
All these costs may place undue burden for those who lack the funds for repairs and/or for the actual inspection.
It will also cost you time to prep your home and for the actual inspection. And you’ll have to go through the same process again for the buyer’s inspection.
The buyer will have to do an inspection anyway, so why bother?
Those in the industry tend to agree that a pre-listing inspection is a good idea. The benefits usually outweigh the cost.
Your situation is unique though and only you can decide what’s best for you. Remember to ask for advice from your agent if you’re having a hard time deciding.
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We hope you found this blog post on Should First Time Home Sellers Pay For A Pre-Listing Home Inspection? useful. Be sure to check out 17 Mistakes to Avoid When Selling Your House for more great tips!
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