How One Home Inspection Could Have Saved Over $13,000
Planning to sell your home? Hire your own home inspector to inspect it before you put it on the market.
Planning to sell your home? Hire your own home inspector to inspect it before you put it on the market. Having your home inspected before it’s listed for sale will greatly reduce the potential for surprises that may crop up in the future.
I’ve given many anecdotes of how home inspections done for sellers can help the whole transaction go smoothly, but I recently had a real estate agent share a story with me that tops ’em all. This agent was an investor in this deal, and he tells the story in his own words:
This was a series of unfortunate events, but essentially here’s how it went down:
– We supposedly “completed” the build project and began marketing it in July for top dollar. Major renovation, spent 350k on the work, all hired out to experienced, licensed professionals.
– Property didn’t sell, didn’t sell, didn’t sell. Price dropped, dropped, and dropped. By now we were entering fall / winter and chasing the market down, left with fewer and pickier buyers.
– We finally get an offer, which puts us at break even. Buyers are attorneys, and cautious, negotiations are drawn out and tedious. We finally get consensus on price and closing date, and buyers move to the inspection.
– After the inspection, they immediately cancelled, not providing us with any reason other than the property felt “abandoned” and unfinished by the builder—there was lots of unfinished punch list items and other issues (no sump / drain tile system installed). We, the sellers, freak out on the builder and tell him to get over there and finish those items. In his defense, there was also supposed to be an opportunity for him to walk thru with the buyers and make a punch list of items (wall dings, screw pops, etc.), so he tells us he wanted to do it all at once, which is why things were unfinished. Whatever.
– Feeling like an incredible real estate agent, I get another buyer immediately. We negotiate a BETTER deal than the last, and begin patting ourselves on the back and talking about how stupid and high maintenance the previous buyers were. Glad to be done with them, now on to the new inspection, and thankfully the builder has already been there to correct everything.
– These buyers also cancel unilaterally, immediately after their home inspection. They do not try to renegotiate price or corrections.
– Defeated, I beg the buyer’s agent for forgiveness. He likes the house, so do the buyers, and as a courtesy he sends me the list of corrections they were going to send before deciding to cancel. Some of the items are erroneous, many are valid. We had a drain tile system installed when the foundation was done, but not the sump pump. We have a radon pipe going out of the home but no fan. The inspector called us out for not having closers on a built-in bench and that it could smash little fingers. The closers were visible, in packaging, sitting in plain view in the bench… but just hadn’t been installed yet. LOTS of little things like that.
Bottom line – if we would have had the home inspected first, we could have made the corrections or held our contractors feet to the fire to do things. We wouldn’t have lost these deals – and let me quantify the loss for you: $13,300 price reduction and we “corrected” everything—whether it was wrong or not – much out of pocket.
A $500 inspection and some bruises are much better than that. And just KNOWING what the issues are – we trust our builder and trades people that we pay top dollar to, but they did us wrong.
They say surprise is the enemy of thought. We were surprised, put into a panic, and had to act out of desperation and humility (we feel bad our property was $#!%) instead of just having our $#!% together.
I’ve done well over 600 deals, been in the business 10 years, and consider myself good. But look at where we ended up. Pre-inspections are worth it every time, literally.
Hard to top that one, huh?
For anyone concerned about the cost of a home inspection, or for anyone who thinks a full home inspection report isn’t necessary or even wanted, no problem. Home inspectors can work around that. Instead of a full home inspection, we do a ‘walk-n-talk’ consultation. We go through the home the same way we would for a normal home inspection, with the owner following right along, but the owner takes their own notes. We skip over the obvious stuff that anyone living in a home already knows about, and the whole walk-n-talk probably takes about half as long as a normal home inspection. We offer this same type of service to property investors who want stripped down home inspections, which we call investor inspections.
There’s no report for a walk-n-talk, but the price for this consultation is about half the price of a home inspection. Next week, I’ll follow up with a post on how to get the most out of your Truth-In-Sale of Housing evaluation.
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