Are Pre-Listing Home Inspections really a Good Idea?

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Are Pre-Listing Home Inspections really a Good Idea?

By Natalie Eisen

Real estate agents generally agree that a home inspection is essential for the buyer. But should the seller take the time and money to have their home inspected before a buyer enters the picture? Some agents believe that this can be waste of money for the seller and present risks, while others argue that a pre-listing inspection can be vital to the seller going into a home sale.

“It’s usually not in the best interest of the homeowner to do a pre-listing inspection,” says Barbara Todaro, a Massachusetts real estate agent. “I see this function as a benefit to the buyer. All listing agents must think about what is best for the seller and how the seller will benefit.  A pre-listing inspection is nothing more than a game of chance for the seller. Be cautious about what you recommend to your potential seller. Your recommendation may cost your seller some money they don’t have, and it may cost you the loss of a listing.” Todaro explains that full-disclosure laws mean that whatever is in the report must be revealed to potential buyers. She says that there is no way to tell for sure what the buyer is capable or willing to repair – and disclosing everything that needs repairs is a surefire way to scare off potential buyers.

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Real Estate Agents, Real Estate Brokers, Errors and Omissions Insurance, E&O Insurance, Liability

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“In some situations, pre-inspections can cause disputes,” says Toni Weidman, a Realtor from Florida. “Several pre-inspectors have found some things wrong, and the sellers went to the trouble and expense of having those items repaired. They thought that was the end of it. Then along came a buyer who had his own inspector and found several more items. Now, of course, the buyer wants them fixed. The seller is saying no, he’s not paying for any more fixes. He had a pre-inspection done, and the repairs were made. He may think the buyer is trying to rip him off.” Weidman says that cases like these are the reason not to complete a pre-listing inspection. “Why not wait to have the inspection done and covered by the contract?” Weidman asks. “Isn’t that what the contract is for?”

Others disagree. “Why should a seller pay for the expense of a home inspection when any smart buyer is probably going to hire their own inspector anyway?” asks Russell Spornberger, Georgia home inspector. “Preparation is the keyword here: ‘forewarned is forearmed’.”  Spornberger says that having a pre-listing inspection can “arm” the seller with information they may not have had about their home – few sellers, he says, will take the time to climb onto the roof or take a look at their electric panel. “By doing a pre-listing inspection,” he says, “a seller can learn the true condition of their home from an objective observer. Using the pre-listing inspection and without the pressure of a pending sell, the seller working with his or her listing agent can develop a strategy that will ensure the house will be sold quickly and smoothly.”

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“A pre-inspection catches what the buyer may find during their own inspection,” says Athina Boukas, broker and Realtor in North Carolina. Boukas is strongly in favor of pre-listing inspections, saying that they have a multitude of advantages: for example, the pre-listing inspection report can be presented to a potential buyer in order to reveal all information about the home immediately and start off with full confidence. “It is less likely that the buyer will ‘renegotiate’ the offer after their own inspection,” Boukas adds, “because it is less likely they will find a surprise or a ‘new’ deal breaker.”

Although the decision about whether or not to have a pre-listing inspection ultimately falls on the seller, real estate agents should note both sides of the argument and decide for themselves which side they fall on.

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One Comment

  1. I am with Coldwell Banker Coast RE, Florence, OR. We are mainly a retirement community. (The BEST, according to Paul Harvey 9 years ago). Many of my sellers are elder folks who have lived comfortably in their homes for 15, 20 years or more as retirees. I recommend, at the very least a pest and dry rot inspection by the Seller – after I list the property and only IF we do not receive an offer after multiple showings with comments left such as, “Too much work”, or “don’t know what we cannot see”. The Inspection helps greatly when it comes to properties which are in need of updating or repairs due to deferred maintenance. The goal is full disclosure. The more we know, the better platform we have for negotiating a sale, with both buyer and seller walking away from close of escrow feeling satisfied with their accomplishment.

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