Buying or selling a home represents one of the biggest transactions you will make. Performing a home inspection during this process is a practical way to gain peace of mind by increasing visibility and transparency. However, a worrying trend involves people waiving these checks. What has caused it, and what are the risks?
1. Who Needs a Home Inspection?
An inspector’s report can give home buyers a clearer idea of what they are purchasing and whether it will need major repairs soon. A home is a significant investment, and the inspection findings can give people confidence that it is a good one — or convince them they should change their plans.
Sellers can also have prelisting inspections performed, letting them get ahead of issues that potential purchasers may find during their checks. The outcome can also give the seller more justification to put the property on the market for a top dollar amount, knowing there are no major problems with it.
Home inspections occur for new builds, too. There is often a one-year period where a warranty covers structural defects. Homeowners who suspect abnormalities in their new builds during that time may have home inspections performed to prove the builder is at fault.
Those planning to invest in a new build may also opt for an inspection to verify that the home is up to standards and meets expectations before it is too late.
2. Why Are Some People Waiving Home Inspections?
Home inspections allow purchasers to exercise their due diligence and prevent situations where they regret buying because of a lack of awareness. Additionally, the findings may allow them to pull out of agreements with sellers without losing money if the report uncovers significant problems. That will occur if the party selling the property refuses to lower the price to compensate for the buyer’s need to address the problems found.
Given that these checks provide such protection, why are some potential buyers opting not to have them done? One reason is that they believe it will give them an advantage in a highly competitive housing market. Those prepurchase checks can slightly lengthen the overall purchasing timeline. Sellers in a hurry to close deals may prioritize buyers willing to waive the inspections.
Another challenge is that home inspectors are increasingly hard to find in some areas, such as Central Wisconsin. Many of those professionals have had to find side jobs to supplement their incomes because of the insufficient demand for their services. This example shows the ripple effects of purchasers deciding they do not need home inspections. One individual working in the area said approximately 300 of the state’s 900 inspectors did not renew their licenses. Individuals with licenses are also still preferred to individuals without similar certifications.
If a buyer cannot find someone available — or will need to wait weeks for an appointment — they may feel inspections are not worth getting. They don’t want to lose out on what seems like their dream home or a prime investment opportunity, so they are willing to proceed without getting those properties examined by professionals.
3. What Are the Risks of Waiving Home Inspections?
A common assumption is that the risks of going without home inspections are only financial. However, they can have far-reaching implications in some cases. That is particularly true if a residence is in an area overseen by a homeowners association. These groups uphold various standards related to things such as landscaping, lighting and community amenities. However, they also receive and investigate complaints about common residential issues, such as excessive noise.
Builders can dampen that sound transfer by carefully designing and testing a home’s flooring system. One measurement concerns the impact insulation class, which determines how well the abode can resist impact transmission sounds from noises such as a chair dragging on the floor. The home should score above 70 if it has premium underlayment flooring. The results of a home inspection can reassure potential buyers that the property is as soundproofed as expected, preventing later engagements with HOA members about noise issues.
Issues can also arise if people go without home inspections because they believe doing so will help them save money. Perhaps someone looked at a residence and loved it, but the market price is slightly higher than their budget. Home inspections are relatively minor expenses considering the cost of the house itself, but some buyers use them as bargaining tools.
Consider the case of a New York resident whose offer was slightly under the asking price. The seller agreed to accept it if the buyer would go without the inspection. However, some of the post-purchase issues found included outdated breakers that required $20,000 in updates and cracks in the foundation. In such cases, people may think they are saving money with their low offers but end up paying much more than they intended.
4. Is Any Home Inspection Sufficient?
As people ponder whether they will get home inspections done or accept the risks of going without, they may notice substantial variations in the fees charged. Sometimes, that is because many states regulate inspectors, requiring them to hold licenses and follow specific procedures. However, an unlicensed person offering checks may set their prices much lower to entice people who care about the cost most of all and will not look into the other details.
There is also a related trend whereby some home inspectors say potential buyers ask them for abbreviated checks, which real estate agents suggest they get instead of traditional inspections. They believe the shorter checks will help their clients win increasingly fierce bidding competitions that define the housing market in some areas. Although conventional examinations last up to four hours and are comprehensive, those in the industry have nicknamed the briefer inspections “walk and talks” because they happen so quickly — sometimes in as few as 20 minutes.
However, those briefer inspections give buyers no recourse and do not come with reports. Some inspectors have resorted to offering those on request, saying they help them stay in business and at least let potential purchasers learn a little about the properties. Others strongly oppose and will not perform them, asserting that these surface-level checks could mislead people.
Anyone looking for a home inspector should clarify what that professional will do before hiring them. They should ensure that the price includes a written report of issues discovered and verify that the person holds the appropriate license.
Waiving Inspections Is Not Worth the Risk
Whether someone is buying a home to live in with their family or wants to purchase one as an investment, the transaction will be one of the biggest and most important they ever make. Despite the trend of people going without inspections, that option is extremely risky and can create unanticipated — and expensive — complications for you.