By Rebecca Wissink
When you’re selling your home, preparation is everything if you want to get top dollar for the property, and your Realtor® can help with much of this. Preparation can include, at minimum: decluttering; giving the home a deep cleaning; attending to the aesthetics of the home (repairing paint scratches); working with a professional stager; having the photos digitally staged if necessary; and, having fabulous photos that showcase the best of the property. But have you considered obtaining a home inspection as part and parcel of putting the best version of your home to market?
Home inspections have become commonplace in recent years and serve an important purpose: they inform a potential buyer of any major repairs the home needs. Which, of course, may drastically alter their desire to purchase the property. Often, if something is discovered by a home inspector, negotiations ensue, usually around the price or having the current owner make the repairs as a condition of the sale. As a seller, having a pre-listing home inspection may reduce or eliminate negotiations and might help you close at or above the listing price.
As part of the plan you will create with your Ross Pavl Elite Realtor®, you can choose whether you want to obtain a pre-listing home inspection and offer it to potential buyers, or not. The point of this article is to help you make an informed decision about whether or not to get a pre-listing home inspection, as there are both risks and benefits to obtaining this report prior to selling, which Table 1 below outlines. The biggest risk for a seller is that if you aren’t willing to address at least some of the issues before listing, there is no point in finding out about potential repairs.
Table 1. Benefits and Risks for the Seller of a Pre-Listing Home Inspection (multiple sources)
|
Scenario |
Benefit |
Risk |
|
Repairs |
You can get ahead of a major repair that could kill a deal, and/or you won’t have to haggle with buyers who want a reduced price to deal with the repair. You’ll also have control over the budget for the repairs rather than paying a premium for a quick turnaround in order to save a deal. |
You will have to disclose to the buyer what you’ve repaired and why. If you aren’t prepared to make any of the repairs that are found, there is little reason to have the inspection. |
|
Closing |
You will likely close the deal more quickly as nothing should come up during the buyer's home inspection that could cause concern. Having this report in hand should help you close at or above the listing price. |
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|
Negotiation |
There will be less to negotiate about if the buyer has more information up front. Even if you don’t fix everything in the home inspection, your asking price can reflect this. |
|
|
The Type of Market |
In a buyer’s market having this inspection can give you a leg up against the competition and make your property more known, and thus more attractive.
|
Ethics/morals aside, in a seller’s market, it might not make sense to spend this money as your home will sell quickly, regardless. However, see Emotions below for how a home inspection could benefit you even in a seller’s market.
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|
Value/Cost |
You will be able to ask top dollar for your home if you have done any repairs and/or if you can demonstrate that the home is in pristine working order. It could save you tens of thousands of dollars if you retain that perfect buyer the first time, given you will likely lose both value and time before the next buyer comes along. |
An inspection will cost at least $4-500 for the average size home, more for anything over 2,000 square feet, less for an apartment. |
|
Legally |
Your jurisdiction may have disclosure requirements which you are more prepared to meet with a pre-listing inspection, and this lessens any chance of a lawsuit down the road. |
You will have to disclose to the buyer any significant issues that arose during the inspection, such as structural damage, mold, water damage, or termite damage, regardless of whether you fixed it or not. |
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Mortgage Approval |
The buyer’s financing may be dependent on an inspection so you can help the buyer remove their conditions more quickly. |
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Emotions |
Buyers will be positively swayed by seeing a home inspection report. Buyers will pay more in a multiple offer situation if they have the report beforehand as they have more confidence in the property. |
The buyer may not have cared about the issues brought up in the home inspection report that you have paid money to fix. |
It seems clear from Table 1 above that there are more benefits than risks to a seller engaging with a home inspector and obtaining a report before listing the home. However, certainly in a seller’s market, it isn’t necessary to have this report in order to sell your home, although it could still lead to a greater selling price. And in a buyer’s market, having this inspection can give you a leg up against the competition. But ultimately, it is the seller’s choice whether to pay for the services of a home inspector before listing.
Ross Pavl ELITE Real Estate Group Realtors® assist their selling clients with all the preparation services noted above, including pre-listing home inspections, as part of a service system that ensures you receive not only the best customer service when selling your home, but that you get the greatest value for your home.
Please contact an experienced Ross Pavl ELITE Real Estate Group Realtor® regarding any questions you have about home inspections or the Calgary area real estate market.
Photo via creative commons courtesy of MarkMoz12
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