A few weeks ago, one of our home buyers decided to write an offer on a home that had already been given a full, professional home inspection prior to going on the market. The home was in great shape, priced well, and there were multiple buyers interested in the property. Because the seller had already provided a copy of the home inspection report up front, our buyers felt comfortable buying the home “as is” and not asking for repairs. This was a smart move on the seller’s part because our buyers (and many other buyers as well) were willing to offer a considerable amount over the seller’s asking price and feel comfortable about their decision, knowing there were no potential issues with this home.
This is a strategy that’s been around for a while. Actually, I first began seeing this back in 2008 when there were many bank repos hitting the market. Some banks did not want to negotiate on repairs, so they would send a professional home inspector to the house and then provide that report to all potential buyers, stating the home will be sold in “as is” condition. Relocation companies also have a policy of doing this on every single home they service. In real estate we call this a “pre-listing home inspection.”
In the typical real estate transaction, the buyer is the one to order a home inspection. But sellers can request a professional assessment of their home before putting it on the market. A pre-listing inspection provides sellers with upfront information about the condition of their property, which gives them more control over repairs and potentially strengthens their negotiating position. Our real estate team typically suggests doing this for homes more than 30 years old. I tell our sellers, “When do you want to know there is a problem? After you get the home under contract and are on a tight deadline or before we put the home on the market when you’ve got more time?”
The biggest upside is the choices this gives the seller. It puts them in control because they can read the full report and decide if they want to spend money on repairs before going on the market. I typically suggest they do repairs, but now they can choose their own vendor to make the repairs and oversee the work themselves. Sometimes in a real estate transaction, the buyers dictate how the repairs will be done and also who will do them. Plus there is not the added pressure of that “countdown to closing” clock. Many times it takes a week or two before we get the repair list from the buyers agent and now the sellers only have two weeks to get the repairs completed before closing, all while they’re packing and preparing for the move. It can be incredibly stressful.
The cost of a home inspection is usually the same as a buyer’s inspection, generally ranging from $350 to $500 for a qualified inspector. Of course, the price varies based on location, square footage, age of the home, and any special conditions. From my experience, it’s well worth the money spent, and as in my example with our buyers, they were much more willing to take the home “as is” up front when writing their offer. I’m also sure this made the seller feel better about choosing our offer. Our buyer still had the right to do their own home inspections, but some buyers will waive the inspections all together in these cases. It can be a huge benefit for both parties.
If you’re thinking about selling your home and have questions about this, please call us. We’d be more than happy to explain all the benefits and even recommend an experienced home inspector.