10 Oct Types of Home Inspections – The Pre-Listing Inspection
For the next type of home inspection, let’s move onto the pre-listing inspection, also known as a seller’s inspection.
WHO ORDERS THIS INSPECTION?
This inspection is ordered by the homeowner(s) looking to put their house on the market, i.e. a “seller.”
The purpose of this inspection is to verify that all Structural, Mechanical, Electrical, and Plumbing systems are installed and operating as intended. Again, in the typical real estate transaction, the buyer is the one to order a home inspection. However, sellers can also schedule a professional assessment of their home before putting it on the market. A pre-listing inspection provides sellers with current information about the condition of their property, which gives them more control over repairs and potentially strengthens their negotiating position.
So, why should a seller do an inspection, particularly if the buyer is going to do one anyway?
An article from REALTOR Magazine explains it this way, “The value to the seller is that a pre-listing inspection makes them aware of issues in advance of negotiating a purchase agreement, allowing them the chance to resolve the issues or have them accounted for upfront in the asking price. This gives the seller better control in marketing their home and helps minimize stress from heat-of-the-moment negotiations once a purchase agreement is tendered. Homes that have a pre-listing inspection generally sell faster and have fewer inspection-related issues to negotiate, enabling a smoother transaction. “
InterNACHI suggests that having an inspection performed ahead of time helps in many other ways, such as:
It allows you to see your home through the eyes of a critical and neutral third party.
It alerts you to immediate safety issues before agents and visitors tour your home.
It may alert you to items of immediate concern, such as radon gas or active termite infestation.
It permits you to make repairs ahead of time so that the buyer doesn’t get to negotiate the repair price.
Defects won’t become negotiating stumbling blocks later.
There is no delay in obtaining the Use and Occupancy Permit.
You have the time to get reasonably priced contractors (or make the repairs yourself, if qualified.)
It helps you to price your home realistically.
It may relieve prospects’ concerns and suspicions.
It may encourage the buyer to waive his inspection contingency.
It reduces your liability by adding professional supporting documentation to your disclosure statement.
SCOPE AND STANDARDS
The only difference between a buyer’s inspection and a seller’s inspection is the customer for whom the inspection is being conducted and the time frame when the inspection occurs. The scope of the inspection should be exactly the same (see the scope for a buyer’s inspection listed above). It’s a full inspection for the seller utilizing the same standards of practice depending on the inspector and city/state requirements.
The cost for a seller’s inspection is arguably worth the investment. Yes, the seller does pay the cost for the inspection out-of-pocket. However, because the seller is able to either address issues with their own choice of contractor and not on a potentially more expensive, rushed timeline OR have the issues accounted for in their initial asking price, many consider the fee for this inspection to be money well-spent.
Again, the on-site examination of the home should take two to four hours or more, depending on the specifics of the job (i.e. age or size of home, foundation type, etc.). And the written report may take an additional two to four hours to compile. Costs range from $300 to $500 for typical homes.
Depending on the disclosure laws in your state, you may be legally required to disclose all the problems the inspection uncovers to the buyer. By doing a home inspection before listing for sale, you might know about a significant number of problems. If you live in a state that requires disclosure, you now must let the buyer in on these issues. Talk with your real estate professional for more information.
If you need to schedule a home inspection or have questions please contact us at 941-779-7170 or click here to email us.