Home Inspection BEFORE an Offer
Consider Suggesting a Home Inspection BEFORE Your Client Makes an Offer
Traditionally, Home Inspections don’t happen until after the buyer has made an offer. But having a home inspected before submitting an offer is a relatively frequent practice in places such as San Francisco and Seattle. Many real-estate agents think it’s a practice worth adopting more widely.
Researchers at the real estate group Redfin in San Francisco say that offers paired with pre-inspections were successful 21 % more often than other offers, and that home buyers whose offers included a pre-inspection were more than twice as likely to win a bidding war as those without one.
“It tells the seller that you already know what’s wrong with the home, you still want to buy it, and you’re not going to ask them to pay for repairs later,” says Colwell, the Redfin agent.
In a competitive bid situation “an offer for $880,000 with no inspection contingency will likely win over a $900,000 offer with an inspection contingency,” says Mark Colwell, a real-estate agent with Redfin in San Francisco.
SOURCE: Goldstein, Daniel. “10 Things Home Inspectors Won’t Tell You.” MarketWatch. N.p., 23 Feb. 2016. Web. 22 Mar. 2017.
Todd Riley at Sherlock Home Inspections says, “We’ve conducted several Home Inspections throughout Florida before our clients have made offers, mainly in For Sale by Owner (FSBO) cases where Realtors weren’t involved. But we have had a few Realtors recommending an inspection before an offer in hot markets, highly desirable communities, & competitive bid situations”
Here’s how the seller may interpret an offer:
Offer “contingent upon a home inspection” = I need to essentially take my house off the market for 7-10 days while they nit-pick the house so that they can find a reason to back-out or request repairs &/or a reduction in the price.
Offer with a home inspection already completed = This offer is solid and I am not going to be hit with any surprises. Plus, I don’t have to wait through a 7-10 day inspection period which means we can close faster.
Obviously, the Buyer’s Agent needs permission from the seller to schedule a Home Inspection, and that request may be confusing to the Listing Agent in areas where this practice is not commonplace. Just explain that the buyer doesn’t want to waste everyone’s time if the house has any major issues, but would rather make a solid offer without a Home Inspection Contingency. Consider sending the Listing Agent this article. While there’s no guarantee that the seller won’t accept another offer before your client has had a chance to submit one, it’s unlikely since they know that a solid offer is forthcoming.