When it comes to purchasing a new home, one of the crucial steps in the process is the home inspection. Choosing the right home inspector is paramount, and an experienced agent will have handpicked the best professionals in the industry from their years of experience.
In this comprehensive blog post, we'll delve into the significance of selecting the right inspector, the benefits of utilizing a third-party inspector for new construction properties, decoding inspection reports, leveraging the findings to ensure a successful appraisal, and effectively negotiating repairs or concessions. We'll also touch upon the etiquette of the inspection process, emphasizing the importance of maintaining fairness and reasonableness throughout.
The Importance of Choosing the Right Home Inspector:
An experienced real estate agent will have several reputable inspectors for you to choose from. They will also have first hand knowledge of their professionalism, turn around time and clarity of their reports. It is important, however, that you make the ultimate decision of whom you choose. When considering your options, assess their experience and expertise in residential properties, as well as their affiliations with reputable organizations like ASHI or NAHI. Lastly, take the time to read reviews and testimonials from past clients.
The Benefits of a Third-Party Inspector for New Construction
It is a common misunderstanding that a newly built home will not have any issues in need of repair. New does not equal perfect, mistakes can and will be made. A building inspector may come through and give the "Certificate of Occupancy" but there can still be items that need to be addressed prior to closing. The builder's crew is there to do the work for the builder, a third party inspector is there to ensure everything was done right. Different builders certainly have different levels of quality, but all are subject to human error. One benefit of purchasing new is that the majority of items found in need of touch up, replacement or repair is that no matter how long the list, usually a builder will agree to the majority of items requested.
Decoding the Inspection Report
It is common to see an inspection report that will span over 50 pages. That can be overwhelming for first time buyers, and give an impression that you may be buying a money pit. It is important to understand the anatomy of an Inspection Report so that you can gain insights into the condition of the property and assess whether you want to move forward, make requests, or cancel your contract. While every detail of the home is reviewed and marked for satisfactory and unsatisfactory findings, most inspectors will include a summary of major concerns. This is where most of your focus should be.
Aligning the Inspection with Appraisal Requirements
Having your inspection done before the appraiser comes could save you hundreds of dollars. Especially if your loan type is subject to appraisal conditions. An FHA or VA loan type has a multitude of items that need to be reviewed. An appraiser will look for common issues like broken windows, foundation cracks, tripping hazards, exposed wiring, peeling paint and more. The inspection will give you the opportunity to make repair requests so that that your loan is not denied by the appraiser later in escrow.
Leveraging the Inspection Findings for Negotiations
When items of concern are found during the home inspection there are multiple ways to address them. It is important that your contract give you enough time to not only have the inspection and recieve the report, but to also have time for any additonal inspections that may be needed. Your inspector will know many things, but since they are not a professional roofer, plumber, electrician etc, they will not be able to give you a quote for anything that they find.
Once you have an idea of what certain repairs cost, you can leverage that information and negotiate with the sellers. Additionally, your agent should get any quotes in writing so that they can be submitted with the Inspection Contingency Release to bolster the seriousness of your requests and add validity to the amount of the requests you are making.
Option one is to make a request that the seller address certain issues prior to closing. If there is not enough time between the inspection and the closing date to complete those repairs you may also want to extend your closing date to accomadate the repair work. Or you could instead request that the seller reduce the price by the amount of the work needed. Consider that even if you, as a homeowner would be willing to do the work yourself, you can still request this adjustment. You can also request cash at closing, this may be worked into your contact as seller concessions, which translates to the seller contributing more cash towards the closing costs. Or it could be a combination of the two.
The Etiquette of the Inspection Process
While it may be enticing to request as much as possible, keep in mind that both seller and buyer have to agree in order to move forward. It is important to be reasonable and consider the situation. The key items to focus on should be expensive to repair, difficult for a homeowner to access (such as the roof or going into the crawl space), items that require a professional to repair, or are not up to code, could invalidate your homeowner insurance or wouldn't be covered under that insurance, or that pose a safety risk.
It is equally important for your agent to communicate with the listing agent prior to sending your requests. Idaho contracts only allow to go back and forth several times. The more that can be worked out verbally, the more likely that what you do request will be accepted. The listing agent may also be more forthcoming with their sellers situation at this time. A seller that is living out of state, has an inadequate amount of time to pack and to do repairs, or if its the estate of a deceased love one, may be far more inclined to address issues with a dollar amount than to do they repairs prior to closing. Flexibility for each parties situation will make for a much smoother transaction.
In conclusion, the home inspection stage is a pivotal moment in the home buying process, providing you with a comprehensive understanding of the property's condition. With the guidance of House Of Plamer and our expert insights shared in this blog post, you can navigate the inspection process with confidence. By leveraging the inspection report effectively, you'll be well-equipped to negotiate repairs, secure a fair deal, and ensure a successful appraisal. Remember, approaching the inspection process with professionalism and respect is key to fostering positive outcomes and building fruitful relationships with all parties involved.