Arranging a Professional Inspection Before You Sell Your House
Learn when it makes sense to hire a home inspector before you put your house on the market.
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Any serious buyer will probably make his or her offer contingent on having your house professionally inspected, with the buyer approving the results. The buyer’s inspection may turn up a variety of hidden defects or problems that can turn the negotiating tables in the buyer’s favor.
One step you can take to make sure your house is in the best possible condition — and that a buyer can’t take advantage of you later, when problems are discovered during the post-offer inspection — is to hire a professional inspector before you sell your house.
Hiring a Home Inspector
The professional inspector a seller hires will not be the same person who will look at the house later, when hired by a buyer. Instead, this pro will work for you to help identify hidden problems so that you can either make repairs or reduce the price of your home accordingly.
The most qualified home inspectors are contractors or other professionals with specific knowledge in all aspects of home construction, including plumbing, wiring, and much more. To find a good inspector, ask friends as well as your real estate agent for recommendations, examine each inspector’s sample reports, and make sure the inspector is licensed (if that’s required in your state) and is a member of the American Society of Home Inspectors or ASHI. Expect to pay several hundred dollars; the price will depend on the size, location, age, and type of your home, and the level of detail you want to see in the report.
See the Nolo article Getting a Home Inspection for advice on choosing a home inspector.
What Sellers Can Ask Inspectors For
A professional inspector will identify problems with your home, such as leaks in the roof, possible water damage, remodeling efforts that don’t meet current building codes, and improperly grounded outlets. With this information, the home inspector will prepare a written report (unless you’ve arranged for a less expensive oral report), and may make repair recommendations. If the report gives your house an A grade (or something close to it), you can hand copies of the report to buyers, to show them what great shape the place is in.
Apart from the general inspection, various specialized types of inspections are available, the most notable being for pests (such as termites, carpenter ants, and dry rot). You can also hire inspectors who deal with specific issues, like the condition of your home’s soil grading or a swimming pool. But unless you suspect a problem that you’re worried a buyer will want to negotiate, you’ll probably be okay just hiring a general inspector and perhaps a pest inspector, and letting the buyer decide what other specialists to bring in.
Deciding Whether or Not to Make Repairs
Once you have the inspector’s report, you have two basic choices: Make the repairs or lower the sale price.
When to Correct Problems Identified by the Inspector
Making certain repairs before you put your house on the market makes sense when the repairs are relatively small and inexpensive. If the problems are more significant, such as a leaking roof, you may also want to make the repairs, because this means you will have fewer problems to disclose to the buyer. The law in most states requires formal disclosure of known problems, but if you’ve remedied the problems, you’ve shortened the list considerably. (Of course, if you don’t fix the problem, you still have to disclose, as discussed below.)
See the Nolo article Required Disclosures When Selling U.S. Real Estate for more on seller disclosures.
How to Factor Repairs Into Your House Price
There are cases when doing a repair before putting a house on the market won’t make sense. Major repairs, in particular, like fixing a crack in the foundation, can be very expensive, disrupt your life, and may not even help your bottom line (that is, you won’t get $30,000 more for your house because you spent $30,000 repairing the foundation).
In such cases, you may be better off having a contractor take a look and estimate the cost of repair, then lowering the sale price accordingly. You can then tell prospective buyers that the repair issues exist and were accounted for in the sale price. If a buyer says to you, “I’ll pay $10,000 less because there are pieces of defective siding,” you can comfortably respond, “I knew about the siding when I researched the price. It’s already factored into the market value of the property. It should cost about $2,500 to replace those few pieces, and I listed the house at $3,000 below market value to compensate for that and for any inconvenience to the buyer.”
Seller Disclosure Requirements: The Flip Side of Hiring a Professional Inspector
In most states, sellers have a duty to disclose known defects to prospective buyers. If you fix the problems identified in an inspector’s report, there’s nothing to disclose. But if you don’t, you’re now under a legal duty to let the buyer know about the problems. This can be frustrating if you uncover a small problem, or the inspector finds something seriously wrong that you had no inkling of.
But remember, the buyer is likely to have a separate inspection done anyway, in which case the same repair issues are likely to be revealed. At that point, you’d be at a psychological disadvantage. At best, the house would appear to be worth less than the price tag you put on it. At worst, you’d look like you’d been hiding something. And many state disclosure laws assess strict penalties against sellers who fail to disclose know defects.
Even if you conceal a defect from the buyer and the buyer’s inspection doesn’t discover it, the buyer may discover it after the sale has closed. At that point, not only will penalties kick in, but the buyer may be angry enough to sue you.