Orchard’s home value estimates are 30% more accurate than our competitors.
Orchard’s home value estimate is 30% more accurate than others.

Why Home Inspections Are So Important When You’re Buying

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The U.S. housing market has been on fire over the past few years, leading to bidding wars, inflated prices, and waived contingencies all over the country. In a seller’s market, buyers are willing to do a lot to make their offer stand out, including waiving a home inspection.

While agreeing to forgo an inspection may make your offer more compelling to a seller, it’s a bad idea, especially if the seller is eager to avoid an inspection. There are a number of reasons why home inspections are important, the biggest of which is that they provide vital protection for buyers. So, unless absolutely necessary to close on a home you love, you shouldn’t waive your right to do one.

In this piece, we’ll explain a bit more about what the home inspection covers and why they say in real estate, “for your protection, get a home inspection.”

What is a home inspection?

 A home inspection is a professional inspection of a home that takes place after a seller accepts your offer but before you close on the sale. An inspector will conduct a thorough review of the home’s most important components and make a report on the condition of the home. This process helps identify things that need replacing immediately, items that may be an issue in the near-future, and gives you a better understanding of the house beyond a cosmetic perspective.

Home inspections are not always required, although most banks will require one for conventional or government-backed loans. If you have a large down payment, you may be able to waive a home inspection to juice your offer. However, as we’ve said, that’s not recommended.

Home inspections typically range from $300 to $500 but they can save you far more money in the long run.

What does a home inspection cover?

A standard home inspection covers the structure of the home, as well as the functional components that make the home habitable. This includes:

  • Roof condition
  • Driveway condition
  • Basement and garage foundations and framing
  • Electrical outlets
  • HVAC
  • Window alignment
  • Plumbing
  • Appliances (if they’re staying in the home)
  • Ventilation
  • Insulation

Each of these items may reveal potentially costly maintenance or repairs. Having a professional identify them before you close can give you greater flexibility and negotiation leverage at the closing table.

What is not covered by a home inspection?

The standard home inspection only covers visual cues, however. It’s important to understand that this isn’t an in-depth, under-the-surface exam. Regular inspectors cannot check:

  • Inside walls, pipes, sewer lines, or chimneys
  • Behind electrical panels
  • Septic tank systems
  • Swimming pools
  • Mold, asbestos, or pest control

Again, each of these hazards can mean a significant extra investment from a buyer after closing. If you’re concerned that a house (especially if it’s older) may have some of these hazards, you may want to consider some of these other specific inspections.

Lead

Before 1978, most homes in the United States used lead-based paint. Today, we know lead is dangerous — especially to children. A lead inspection will identify any lead paint in the house, which you can then ask the seller to pay for abatement or negotiate a discount knowing that you may have to remove it yourself.

Radon

Radon is a silent killer; a carcinogenic, radioactive gas that seeps through foundation cracks or near electrical outlets and pipes. About one in every 15 homes in America is suspected to have excess radon levels. It’s not an extreme concern, but the only way to know if you’re at risk is to test.

Roof certification

While a home inspector will conduct a visual test of the roof, it’s not the most thorough examination. If the inspector flags that the roof looks damaged, you should pay for a roof certification. A roofing company will not only determine the health of the roof but will give you an estimated length of time before the roof needs replacement. Again, this is a good thing to have in your pocket at the negotiation table.

Sewer or septic

Home inspections don’t look closely at plumbing or septic tanks. These can be very expensive fixes so it’s a good idea to invest in a local plumbing company or septic inspector to analyze the overall condition of a home’s waste disposal during a separate septic inspection. It’s especially important if the home is more than 20 years old.

Termites and pests

Termites are especially common in Louisiana, Texas, Hawaii, California, Alabama, Georgia, Florida, the Carolinas, and Tennessee. In some of these states, you might be legally required to complete a termite and wood infestation report to get final loan approval. 

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Why should you get a home inspection?

We’ve touched on some of the most important reasons to get a home inspection, but we want to hammer home the point here. There are a number of very good reasons why, for your protection, you should get a home inspection.

1. Safety

As the previous section lays out, homes may contain hidden hazards. For your family’s health and personal safety, it’s important to know that a house is completely safe before moving in.

2. Negotiation leverage

Every item on the home inspection report is an opportunity for buyers. If an inspector finds things that need fixing or replacing, you can negotiate a price reduction or credit from the seller. Better yet, you can insist the seller just make the fixes themselves before closing.

Home inspectors can help you gauge the costs to bring a home up to an acceptable condition, which will give you a precise number to ask for. Working with the inspector and your agent, you may leverage a better deal on the home.

3. Identify unpermitted work

Many people get work done on their homes without going through the proper channels. It’s convenient for them and may save them money, but not all buyers are comfortable buying homes that may not be up to code. Inspections can reveal if renovations or remodels were done without the proper permitting. Those changes could impact the insurance costs, taxes, and overall value of the home. If you buy the house, you will become responsible for retroactively getting the proper permitting or paying the adjustments in taxes and insurance.

4. Forecast housing costs

Before the inspection, you’ll have an idea of what you’ll pay for your monthly mortgage. An inspection, however, can approximate other future costs. A home inspector will get a rough idea of how old major systems like plumbing and HVAC are, and estimate when you’ll have to replace them and for how much. They’ll tell you how long finishes have been in the home, diagnose the condition of the home’s structure, and help you understand just how costly a home will be to maintain.

If you’re not interested in pouring a ton of money into your home right after purchase, a home inspection may help you avoid that issue entirely.

Even more importantly, an inspection will help you figure out what type of home insurance coverage or warranties you should consider.

5. An inspection is an out

The biggest reason why a home inspection is important is that it gives you an out from a potentially catastrophic financial hole. Buying a house is a huge financial obligation and if you’re nearing the closing table, an inspection is the last, best chance to raise red flags. 

In most negotiations, a home inspection contingency ensures that a buyer can pull their offer without losing any earnest money if the house “fails” an inspection. That’s a huge protection, especially if you’re buying your first home and you’re not entirely sure what to look for.

Put bluntly, waiving a home inspection is a bad idea, even in a hot housing market. Home inspections are crucial to identifying potential problems with the home and laying out what you might spend on maintenance after moving in. An inspection may also raise issues that you can’t overcome, helping you avoid buyer’s remorse. It’s pretty simple: For your protection, get a home inspection.

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