10 min read
How Home Inspections Protect Your Assets
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Buying a home for the first time can be a special time, but also stressful due to the potential pitfalls. That's why it's crucial to do sufficient due diligence, including a home inspection. This article explains the importance of home inspections and what your can expect.
Lesson Notes:
- A home inspection is an essential step in the home buying process that helps to protect your investment by identifying problems such as roof leaks, mold and faulty HVAC systems.
- By identifying major structural issues early on, you can save yourself from expensive repairs after closing.
- Besides highlighting problems, the home inspection report is a strong negotiation tool when asking for repairs or price reductions from the seller.
LESSON CONTENTS
What is a home inspection?
A home inspection assesses the home's current condition, identifying potential issues that could cause future expenses and costly emergency repairs. After the seller accepts your offer and before closing, you should mandate one.
So, why pay for a home inspection? Can I do an inspection myself? Experienced home inspectors have inspected many houses and are skilled in identifying common concerns. Anybody can point out mold in a basement. But only some can unearth serious issues like structural problems with the foundation, electrical faults or plumbing defects. To avoid costly oversights, hiring a professional home inspector is advisable.
You can ask your real estate agent to find a qualified home inspector or hire one through The American Society of Home Inspectors (ASHI). Their Find An Inspector Tool helps you find a professional inspector in your area.
What to expect from a home inspection
During the home inspection process, a home inspector examines the property and provides a detailed report of their findings. The inspection includes:
Exterior inspection
The inspector examines the property's structure, including the foundation, framing, and support systems. Inspectors also scrutinize the condition of the roof, gutters, downspouts, chimneys, siding, and windows. Since water flow issues can also cause structural damage, the inspector checks the property's grading and drainage to ensure water is flowing properly away from the foundation.
Interior inspection
The inspector moves inside the home to examine the interior components. This includes the HVAC and electrical system, plumbing, appliances, doors, and windows. A thorough inspection requires testing the systems to ensure they are functioning correctly.
Attic and basement inspection
The inspector examines the attic and basement/crawlspace areas for signs of issues including water damage, mold growth, insulation issues and ventilation problems.
Environmental inspection
The inspector may also test for environmental hazards such as radon, pests, or mold. For the average buyer, some hazards are difficult to detect. Radon, for instance, is very harmful and a leading cause of cancer but is odorless and invisible to the naked eye.
Inspection report
The home inspector prepares a report outlining their findings after the assessment. The report typically includes details about any issues or concerns found during the inspection and recommendations for repairs or further investigation.
Reasons to get a home inspection
While a home inspection might cost you, it reduces the amount of risk you are taking on. Considering that a home might be your most valuable investment, a thorough evaluation is necessary. You get an objective professional assessment identifying critical issues that could be deal breakers. In many cases, the untrained eye might fail to spot these deficiencies, especially in a staged house.
Remember overlooking a significant issue can cost you thousands in repairs or replacement. So, why take the unnecessary risk when buying your most valuable investment? Here are reasons to get a home inspection.
Identify structural issues
During a home inspection, the inspector examines the property's foundation, roof and walls to identify structural issues. For example, the inspector might point out cracks in the foundation that may indicate settlement problems or water damage. The inspector will likely recommend a roof replacement or repair if the roof shows signs of wear and tear. Overall, the inspection reveals builder oversight, or any significant repairs needed.
Identifying major structural issues early on can save you from expensive maintenance costs. Additionally, these issues can often be negotiated with the seller to be fixed before closing, or you may ask for a reduction in the sale price to cover the cost of repairs.
Highlight safety concerns
No one wants to live in a home where their life is at risk. A home inspection can identify safety concerns that may not be immediately apparent. Faulty electrical wiring or outdated plumbing systems can pose a fire or health hazard.
Your home inspector will thoroughly assess electricity, plumbing and HVAC systems to ensure they are in good condition. For example, in the home's electrical system, they might first check whether it's faulty. Then, they will test every electric outlet to ensure it works properly.
In addition, hazards such as radon are challenging to detect. So, a home inspection to test for toxins such as carbon monoxide, mold and radon is necessary.
Gain bargaining leverage
A home inspection provides valuable information about the home's condition, allowing you to decide whether to purchase the home. One of the benefits of a home inspection is that it protects your investment by identifying any issues that could reduce the home's value. You can withdraw from the purchase if the inspection report reveals significant issues.
But if the problems are fixable, you can leverage the home inspection report in your negotiations. You can use the report to ask the seller to repair it. Also, depending on the issues identified, you can negotiate a reduced price that reflects a realistic value.
Compliance with building code
Home inspections ensure the property is up to code and meets safety standards. This provides peace of mind and ensures that your investment is protected.
Negotiating after a home inspection
Usually, a home inspection takes a couple of hours. However, the inspection period might vary depending on the size of the home. All in all, you can expect the home inspection report within days. The report states any structural deficiencies, leaks, molds, or electrical problems.
With the report in your hands, you are adequately informed of the home's condition. If the house is in good condition, you can proceed with closing the transaction. But, if the report highlights severe defects, your agent will assist you in preparing an inspection-objection list.
The objection outlines the issues with the home and what the seller should fix. Focusing on the key concerns is more important than fixating on minor details. For instance, prioritize issues affecting the structural integrity of the house, e.g., a leaking roof. As the buyer, you have several options:
Renegotiate the sale price
If material problems need to be fixed, you can negotiate with the seller for a lower price. Your agent or lawyer can assist in this. A price reduction allows you to control your repairs after closing.
Require repairs
Ask the seller to repair any problematic areas of the house before closing.
Ask the seller to pay for repairs
You might want to fix the defects yourself. In such a case, you can ask the seller to pay you for repair costs. If you choose this option, be sure to request quotes from contractors to resolve your concerns.
Cancel the purchase
Sometimes, a house might have significant problems, structural or otherwise, that are very costly to remedy. Or the seller might ignore your issues. In such scenarios, canceling the purchase could be the best option if you have a home inspection contingency in your contract.
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