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The Importance of Home Inspections for Sellers

If you are selling your home, should you have a home inspection prior to putting your home on the market? Isn't that typically a buyer expense? How would a home inspection benefit you?

When it comes time to sell, homeowners are typically less than objective about their homes. There is often a great deal of emotional history tied to one's home, and hiring qualified real estate professionals is the first step toward gaining objectivity.

In California, sellers must give buyers a mandatory disclosure form listing known defects, including things like a leaky roof, faulty plumbing, information about deaths that occurred within three years on the property, and even the presence of neighborhood nuisances such as a dog that barks or unpleasant neighbors.

Home inspection reports help sellers disclose issues about their properties that they may have had limited knowledge of. While any inadvertently inaccurate representations about the condition of a home by an owner could be construed as a fraudulent act by an aggrieved home buyer, a professional home inspection at the time of listing demonstrates a clear attempt at disclosure.

In addition, disclosing defects up-front allows the seller to negotiate needed repairs with the buyer at the time the purchase contract is being negotiated. This is advantageous to the seller, as the buyer is emotionally invested in acquiring the home, and more willing to accept defects than they will be once they are in contract. Once the property shows ÔPending' in the MLS and showings have stopped, leverage transfers from the seller to the buyer.

A home inspection alerts you as to whether further inspections are required, and lets you adjust your marketing strategy accordingly. One recent seller's inspection revealed that an exterior deck had been converted into interior space and used as a dining area, without the benefit of required structural support or permits. A subsequent inspection by a structural engineer confirmed that the room was not legal, as it was not supported by a foundationÉ required for it to qualify as Ôconditioned' space.

If this had been discovered during the buyer's inspection contingency phase, it could have been costly for the seller. But, the marketing materials, staging and disclosure packages were adjusted prior to putting the house on the market, and the seller was able to negotiate the defects at the same time as the purchase contractÉ maneuvering around an otherwise difficult and costly negotiation.

The real benefit of a home inspection for a seller in an active marketplace such as ours, where multiple offers are common, is that it puts you in a better position to maximize your profit by passing on many of the repairs to the buyer.

The buyer has a legal right to perform all inspections they deem necessary. This should be encouraged, as it protects the seller from any subsequent claims that the buyer didn't have a chance to make an informed purchase decision.

Providing potential buyers with a home inspection report as part of your disclosure package puts you in a strong negotiating position, gives you time to deal with potentially costly surprises, and (especially in a multiple offer situation) allows you to ask the buyers to accept the current known condition of the property.

Please do not hesitate to call for a referral to a qualified home inspector!

sherrybenninger@grubbco.com

The GRUBB Co., 1960 Mountain Blvd., Oakland, CA 94611

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