7 Benefits of a Pre-Listing Home Inspection
Monday Mar 16th, 2020Share
Getting your home inspected before you list it for sale can streamline the sales process and help you avoid any unexpected surprises. What most sellers don’t realize is the home inspection is the place where more sales fall apart than any other. A pre-listing home inspection will allow you to get a clear picture about the state of your house – including any problems that may derail a sale. You will have a chance to address major - and minor - issues, and the information you gain from the inspection will be useful in pricing your home. Getting your own pre-sale inspection can be a hugely important part of preparing for a buyer's home inspection and I am going to talk about the top 7 benefits of doing so in this blog.
Home inspections are generally performed on behalf of a buyer so that the party purchasing the home knows the true condition of the house. As a seller, you are not required to get an inspection. But there are several reasons why you should consider a pre-listing inspection. In fact, I am so convinced that it is so advantageous for home sellers to do one, that I not only insist on my clients having one done, I also pay for it.
So what are the main benefits of having one done? Let's get started.
1 - Eliminate Stress
By getting an inspection before listing, you can help eliminate a lot of stress surrounding the sale. It is normal to constantly worry and be asking yourself questions like "What is wrong with my house that I am not aware of?", "How am I going to properly price the house for sale?", "Is the first sale going to fall apart?", "Am I going to get sued for something I didn't disclose?" or "Is anyone even going to want this thing?" These are all common and legitimate concerns that keep sellers up at night. However, a pre-listing inspection can and will help ease or even completely erase these concerns and I will delve a little deeper into why as we go on here, but there is no doubt that it significantly helps with dialing down the stress levels that come with selling your home.
2 - Making Repairs
No matter how new or old your home is or how good of shape you believe it to be in, there WILL be "issues" that are uncovered in a home inspection that will have to be put in the report. Some of them can be major, such as mold in your attic, and many will be as minor as electrical outlets without covers. When you do a pre-listing home inspection you'll get an exhaustive list BEFORE the market does and then have a chance - on your timetable - to remedy these issues.
Now, the big ones? You just may not be able to tackle them due to financial or time constraints, but the minor ones? They can usually be taken care of with little time or money invested, but it is money well spent to cut that report down as much as you can. As a Seller, there’s nothing worse than when a Buyer backs out of an offer because of easy maintenance fixes; not only do you have to start the sale process over, but you also have to convince every future potential Buyer that your sale fell apart for minor reasons, not because the house is about to fall over.
3. Accurately price your home
The price you set for your home is one of the most important parts of the sales process. Priced too high, and you will keep buyers away until you inevitably make that price reduction that you should have made before you stuck the sign on the lawn. Priced too low and, unless you're in a hot sellers market, you might be leaving money on the table and you certainly don't want that to happen. But how do you price something when you do not know what it consists of, or what state it is in? With a home inspection, you will have a much better understanding of any negative aspects of the house, and can price accordingly before the buyer gets to. It’s never fun to have a potential Buyer educate you about your own house during a negotiation – not only is it embarrassing and unnecessary, it'll cost you money.
4. Avoid price re-negotiations
The carefully considered offer from the buyer may be thrown out the window if the buyer’s inspection discovers any serious issues with your home. If your Buyer’s offer was conditional on a home inspection and it uncovers something they - or you - didn’t know about, you can bet that they are going to want to re-negotiate the price. Negotiating after you’ve accepted an offer is likely to result in a lower price than if you’d accounted for it upfront in the price. That buyer is now upset or worried or spooked and that love they developed for your house is now on the rocks and what they are now willing to pay is going to reflect that. You can’t hide from your house – people will uncover the truth eventually so it's better to know it BEFORE you list, price it into your asking price and take that renegotiation leverage out of the buyer's hands.
5 - Speed up the process
This one is pretty simple math. If your buyer has a home inspection clause in their offer then they are typically going to ask for 5-7 business days to have their inspection done and to review it - and that's 5-7 business days, not calendar day,s so that is really 7-10 calendar days when all is said and done. So during that time, your house is tied up with that conditional sale with no guarantee it is going to close. Showings - and overall interest- are going to go down during this time. Then what happens if they don't like the report and you can't renegotiate or they simply just back out? You go back on the market as if it is day one, except now your house has that scarlet letter draped around its neck that it "failed" a home inspection. All of this can almost always be avoided with a pre-listing inspection.
6. Avoid Future Lawsuits
Now post-closing lawsuits don't happen very often, but they can occur. And what might you be sued over? A failure to disclose defects.
As a homeowner in Ontario, the law requires you to make disclosures about things that could potentially impact the value or enjoyment of the house. A pre-listing home inspection gives you all the information you need to disclose and It might also help prove what you did and didn’t know in a future lawsuit.
7. Encourage Multiple Offers
If you’re looking to generate multiple offers (and create a bidding war), you want to give potential Buyers as much comfort with your house as possible; peace of mind means higher offers and fewer, (or even no) conditions on their offers. Yes! If people have to pay for a home inspection before they submit an offer and aren’t guaranteed to get the house, you’ll likely get fewer offers, which may mean a lower selling price. Buyers who pay for multiple inspections on multiple homes get frustrated – and frustrated Buyers avoid bidding wars altogether. Having a pre-listing home inspection available to potential Buyers is often enough to give Buyers the confidence they need to sign an offer.
So there you have it. 7 benefits to a pre-listing home inspection. Again, while there is no requirement that you get a pre-listing home inspection, there are certainly a lot of advantages to doing so. Every home sale involves stress and uncertainty, but you can limit the negative aspects of the process by gathering all the accurate information you can about your home before you list it. With a seller’s inspection, you avoid surprises and make your sale a whole lot easier, and ultimately, more profitable.
I hope you enjoyed this blog and learned a thing or two about the value of a pre-listing home inspection. If you have any comments or questions, feel free to leave them below and I will be happy to get back to you and continue the conversation.
Also, if you might be having a home inspection done on your home in the future, please download my FREE e-book "How to Prepare For a Home Inspection".