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........there is no down side to not pre-inspecting.
I disagree.
Once terms and price are agreed upon, the house is taken off the market. If discoveries made during the home inspection cannot be resolved, the deal falls through and the listing is put back on the market. Valuable market time is lost. Both agents know the seller's bottom line at that point in time and they know the issues with the house.
It creates a newvulnerability for the sellers and if the issues are substantial, mold, Radon, water issues in the basement and so on, they are going to have to be disclosed going forward.
Lost opportunity costs, especially when chasing a down market,can be enormous.
The age of a roof and mechanical systems versus the average lifespan is what it is.
The price point in my market allows me to pay for the pre-listing home inspection, at closing and I do. It's my job to protect the seller to the best of my abilities and I do.
I'm seeing more homes that are marketed with a pre-inspection. Those are the ones that stand out and get attention first, for that reason. That's an edge I'd prefer my sellers to have.
This is good information about what is happening in your market, but real estate is local, as you know, so this may not be applicable in all markets.
For example, my listing agent was a specialist for my neighborhood. We consulted with him about all of the things we planned to do to make the home look more appealing (some of which he supported, and others of which he recommended that we don't do). He didn't recommend that we have a pre-list inspection done. We had our inspection report from several years earlier when we bought the house, and our neighborhood was full of 1920's era homes - basically every home had an ugly inspection report. So unless you were willing to spend $50,000+ (which you could not recoup by raising the price) or simply raze and rebuild, you were not going to be able to provide the buyer with a clean report.
We sold our house in 4 days with multiple offers at or above list price without a pre-list inspection. So there are plenty of buyers who don't discriminate based on whether or not there has been a pre-listing inspection. Again, I would defer to your local experts.
This is good information about what is happening in your market, but real estate is local, as you know, so this may not be applicable in all markets.
Which is why the complete sentence that you partially quoted said:
"Actually, it's not "custom" in my market, but I'm seeing more homes that are marketed with a pre-inspection."
Kind of important to have that first part on there so that it's clear what I actually said.
Quote:
Originally Posted by Austin-Willy
For example, my listing agent was a specialist for my neighborhood. We consulted with him about all of the things we planned to do to make the home look more appealing (some of which he supported, and others of which he recommended that we don't do). He didn't recommend that we have a pre-list inspection done. We had our inspection report from several years earlier when we bought the house, and our neighborhood was full of 1920's era homes - basically every home had an ugly inspection report. So unless you were willing to spend $50,000+ (which you could not recoup by raising the price) or simply raze and rebuild, you were not going to be able to provide the buyer with a clean report.
Since we're sharing anecdotes, I was recently the buyer's agent and while the seller had bought the house 7 months previously (life changes happened and the seller had to move), and had an inspection report from when he was the buyer, my buyer's inspection report turned up problems that were not on that inspection report.
I've also had the buyer who had an inspection on a new build and had several things turn up (that were fixed prior to closing).
1920's homes should have a pre-inspection done. Not because it will be perfectly clean, but so the seller will know exactly what they're dealing with and what is likely to appear on the buyer's inspection so that they can plan in advance how to deal with them, whether it be pricing the home with those issues in mind, fixing some and not others and pricing accordingly, getting estimates at leisure so they'll have the information readily to hand for decision-making when the buyer's inspection turns them up, etc. (No reasonable buyer is going to expect a "clean" report on a 1920's house. And if they're not reasonable about that, they're not going to be reasonable about a whole host of other things, experience shows.) It does make it easier - for the seller, not necessarily the agent.
Hoping that nothing you don't already know will show up on the buyer's inspection is a practice in futility. It's not something that I would advise my sellers to take on, and I'd be remiss in my responsibility to them if I did not at least advise that they take the steps necessary to reduce that possibility.
Which is why the complete sentence that you partially quoted said:
"Actually, it's not "custom" in my market, but I'm seeing more homes that are marketed with a pre-inspection."
Kind of important to have that first part on there so that it's clear what I actually said.
Not really important, since the second part of the sentence is making the point that you are relying on what you're seeing in your market, and the first part doesn't contradict that. Not sure what you think the first part brings to the conversation other than whether or not pre-inspects can be considered "custom." The point is, it's a "local" question.
Quote:
Originally Posted by TexasHorseLady
Since we're sharing anecdotes, I was recently the buyer's agent and while the seller had bought the house 7 months previously (life changes happened and the seller had to move), and had an inspection report from when he was the buyer, my buyer's inspection report turned up problems that were not on that inspection report.
I've also had the buyer who had an inspection on a new build and had several things turn up (that were fixed prior to closing).
Thank you for making my points that (1) one inspection report isn't necessarily going to match up with another inspection report, and (2) the question is really one that needs to be addressed on a house-by-house basis.
Quote:
Originally Posted by TexasHorseLady
1920's homes should have a pre-inspection done...
I think our agent, who was very familiar with our market (which you aren't), our neighborhood (which you aren't), and our house (which you aren't), has a much better idea of what should and should not be done in preparation for a sale than an agent in a different city whose only information about the home is that it's 1920s era in a 1920s era neighborhood and is being resold within a few years of being purchased. I'm surprised to see an agent who is so adamant about how "local" real estate is (readers may find it interesting to search TexasHorseLady's previous posts on that topic) be so adamant that their experiences in their limited market are applicable to other markets and in fact trump the experiences of other agents in those other markets.
Quote:
Originally Posted by TexasHorseLady
... Not because it will be perfectly clean, but so the seller will know exactly what they're dealing with and what is likely to appear on the buyer's inspection so that they can plan in advance how to deal with them, whether it be pricing the home with those issues in mind, fixing some and not others and pricing accordingly, getting estimates at leisure so they'll have the information readily to hand for decision-making when the buyer's inspection turns them up, etc. (No reasonable buyer is going to expect a "clean" report on a 1920's house. And if they're not reasonable about that, they're not going to be reasonable about a whole host of other things, experience shows.) It does make it easier - for the seller, not necessarily the agent.
I'll leave it to the agents to agree or disagree about whether or not it makes it easier for them, but the first part of this paragraph is contradicted by your earlier anecdote proving that a seller can't really be sure what the buyer's inspection report is going to say, whether or not they pre-inspect. As for the point about pricing correctly, that is moot, because you could always agree to lower the price accordingly if the buyer requests it after they inspect.
In fact, if you price-in the needed repairs and the buyer doesn't really focus on that, you might find yourself being asked to reduce further once the buyer gets their own inspection. For example, in a neighborhood of 1920s era homes, sellers can pretty much expect to be asked for a price reduction once the buyer gets their inspection report. Responding by telling the buyer that you set your price based on those needed repairs may feel like a victory, but unless the buyer had made their offer with those repairs in their mind, your victory may be a moral victory only as the buyer walks away. If you know that you're going to be asked to make some price adjustment simply based on the fact that the inspection report is guaranteed to be ugly, it would not be wise to spend money up front and not get the emotional credit for it from the buyer. You're in a better position if you already have the home under contract.
Quote:
Originally Posted by TexasHorseLady
Hoping that nothing you don't already know will show up on the buyer's inspection is a practice in futility. It's not something that I would advise my sellers to take on, and I'd be remiss in my responsibility to them if I did not at least advise that they take the steps necessary to reduce that possibility.
Setting aside the fact that in either case a seller is at risk of being surprised by the buyer's inspection report, I'm sure your clients in Austin appreciate your advice. But your advice would have cost me time and money, so I'm glad I had a local agent with experience in my local market. I think it's important for the OP to get local advice as well.
Austin-Willie, I'll grant you that I'm not familiar with your house (as far as I know). However, based on your name, unless you're speaking of a house in another city, I'm quite familiar with the Austin market and many, if not most, neighborhoods in it (having been here since 1969 and watched many of them being built and thoroughly explored most of the ones that were already here in that time, back when Austin was a LOT smaller, and having access to and interest in the same data that your agent had in that regard). For me, the Central Texas market IS local.
The reason that part of the sentence was important was because you were saying that what I said was local, which is true, but with your selection of a small part of the sentence implying that I had not stated that it was, which isn't, as I specifically used the words "in my market".
But this is an old game that we've played before, and it's not really all that much fun. Nice discussion up to this point, though.
Austin-Willie, I'll grant you that I'm not familiar with your house (as far as I know). However, based on your name, unless you're speaking of a house in another city, I'm quite familiar with the Austin market and many, if not most, neighborhoods in it (having been here since 1969 and watched many of them being built and thoroughly explored most of the ones that were already here in that time, back when Austin was a LOT smaller, and having access to and interest in the same data that your agent had in that regard). For me, the Central Texas market IS local.
Similar to the OP, my house was not in Austin or Central Texas.
It's beginning to look like we'll be moving across the country, from Oregon to New Hampshire, probably (?) next spring. So I have some time to plan, and I'm thinking, what can I do to make my realtors' jobs easier? I don't want to waste anyone's time and/or money and/or gas. Apart from getting pre-approved, getting the existing house spiffed up, and just generally being a good businessperson, i.e. returning phone calls promptly, what can I do? TIA!
As a recent homebuyer, here's a great idea: CLEAN YOUR HOUSE. I don't mean run the vaccuum and dust. I mean really clean everything down to the grout in the corner of your bathroom.
I cannot tell you how many filthy houses we toured. And when you walk through a house with food on the counters, clutter everywhere, and dirty floors, it inevitably begs the question, "Wow. If they don't even care about the house's appearance, what other important things are they letting slide?"
I don't agree with the comments that imply that a seller is being unethical when they don't get a pre-listing inspection done. There is no legal, moral or ethical obligation to do it. You are required to disclose what you know about, but you aren't required to investigate and discover issues that you don't know about. So all of this about pretending and transparency is off-the-mark unless you are just making the point that the seller should disclose what they already know about.
This has nothing to do with ethics. It has to do with reality. ALL homes have some sort of problem, minor or major. They are built by human beings and as such have defects because humans are not perfect. I accept this as reality, and pass that reality onto my buyers.
I encouage my sellers to accept that reality as well. I KNOW the house will have issues, why do the whole song and dance of "we only have to disclose what we know." I have had a few sellers in the past balk at prelisting home inspections. They were concerned about the whole disclosure thing. They had the same attitude, "if we don't know...we don't have to disclose." Their home inspections came back with minor dry rot, etc. They were actually relieved at having it done, once we did it.
People purchasing a home built in 1920's should know that it will have problems. If they make an offer not expecting issues, then they have a crappy buyer agent who didn't prepare them well. That is not a home inspection and disclosure issue, that is a crappy agent issue.
This has nothing to do with ethics. It has to do with reality. ALL homes have some sort of problem, minor or major. They are built by human beings and as such have defects because humans are not perfect. I accept this as reality, and pass that reality onto my buyers.
I encouage my sellers to accept that reality as well. I KNOW the house will have issues, why do the whole song and dance of "we only have to disclose what we know." I have had a few sellers in the past balk at prelisting home inspections. They were concerned about the whole disclosure thing. They had the same attitude, "if we don't know...we don't have to disclose." Their home inspections came back with minor dry rot, etc. They were actually relieved at having it done, once we did it.
People purchasing a home built in 1920's should know that it will have problems. If they make an offer not expecting issues, then they have a crappy buyer agent who didn't prepare them well. That is not a home inspection and disclosure issue, that is a crappy agent issue.
Whether or not it is a "crappy agent" issue, it is reality. It wouldn't be prudent to assume that every buyer will be represented by a good buyer's agent. So instead, it is in the seller's interest to protect themselves. That means complying with the law but not undercutting your negotiating position by giving up your chips (i.e. latent repair expenditures) without being asked by the buyer or getting any credit for it.
There are really 2 distinct issues: disclosure and repairs. As far as disclosures are concerned, if a seller is honest, an inspection report is not going to add any protection. And as we have seen from other posts on this board, the fact that an inspection report might be clean doesn't prevent a buyer from feeling like they have been deceived by the seller. It seems to be assumed by some agents that both inspection reports will be the same - so from a disclosure standpoint, so long as the seller is honest, the buyer has exactly the same information to make their decision on buying the home irrespective of whether or not the seller has a pre-listing inspection report. The view that sellers should do the buyer's job (inspection) for them, in my opinion, misunderstands the roles and duties of the buyer and seller.
As far as repairs are concerned, sure you can get blindsided if you simply assume that the buyer is not going to ask for any repairs and therefore fail to be ready to respond to such requests. Such an unprepared seller would be poorly represented by their agent. A well prepared seller could obtain quotes and assess repair requests while under contract. If the seller needed some extra time, let the contract be terminated by the buyer while you take the extra time. If you end up losing the buyer because of the delay, you are in exactly the position you would have been if you would have delayed the listing from the beginning while you did the work.
Not to mention the issue of getting "credit" for the repairs. If you spend $1,000 replacing dry rot before listing, you typically won't be able to recoup that expense by increasing the purchase price. So you are out $1,000 and you get no "credit" from the buyer. If you don't replace it, at least you have the chance to save that $1,000 if the buyer doesn't ask for it. And if the buyer does ask for it to be replaced, it is less likely that the buyer will ask for something else to be fixed. Buyers know that have limited ammo for repair requests. A smart seller makes the buyer use that ammo instead of handing out the repairs for free.
And let's not make the mistake of thinking that the repairs are a marketing tool. We are talking about repairing problems that are not known to the seller except because of an inspection report. If the dry rot is so obvious that it really is a marketing issue, then you don't really need an inspection report to identify it. The seller or their agent should spot those issues.
As a recent homebuyer, here's a great idea: CLEAN YOUR HOUSE. I don't mean run the vaccuum and dust. I mean really clean everything down to the grout in the corner of your bathroom.
I hear you on that. However, given what's been going on in the markets (real estate, credit, stock market, etc.), we have decided to stay out of the game for now. This is a "want to" move rather than a "have to" move, so we can put it on a shelf for a couple of years. I'm glad we made that decision, because my whole zip code has been dead, sales wise, for some time now.
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However, given what's been going on in the markets (real estate, credit, stock market, etc.), we have decided to stay out of the game for now. This is a "want to" move rather than a "have to" move, so we can put it on a shelf for a couple of years. I'm glad we made that decision, because my whole zip code has been dead, sales wise, for some time now.
