Prepping buyers and sellers for surprises can help keep a transaction on track.
A home inspection gone awry can spell double trouble in a real estate transaction or how about the Pest Inspection. Sellers who believe they’ve kept their house in pristine condition might hit the roof when costly problems with the property are uncovered. And buyers—especially first-timers with no experience in the market—may be scared away by the prospect of daunting repairs.
How do you keep these common scenarios from drifting into the land of canceled escrows? Before the inspection, it is best to talk with our clients about their expectation and about how they might handle certain results.
Listing agents should be proactive by doing an agent's visual inspection of their client’s home, looking for obvious areas that need repair. Reviewing the age of the seller’s furnace, water heater, and air conditioning unit and finding out what major repairs or upgrades have been done. Looking for "Red Flags" at the beginning helps the seller to understand what a buyer's objections could be. Make sure sellers are aware of issues that are common in your market—such as termites in waterfront communities—and let them know that whatever issues you find in a visual inspection will very likely arise in an official inspection.
Sellers may want to pay for a pre-listing inspection. This gives them an opportunity to collect cost estimates for repairs and determine whether they want to pay for fixes or lower their asking price. Either way, it can prevent last-minute setbacks.
Some sellers may balk at incurring the cost of a pre-listing inspection. Sellers opting for pre-listing inspections put themselves in a much better-negotiating position and are less likely to leave money on the table. Another added benefit is disclosure, great to have a professional look at something that you just weren't quite sure.
Educating our buyers so they need to understand the difference between health and safety issues and normal wear and tear. When buyers are determined to make repairs part of the sales contract, suggest they offer options. For example, they could ask sellers to either have repairs done before move in or provide a credit on the price. Most sellers will take the cost of repairs into consideration to bring about a solution that works to keep a dealing moving forward.
If a buyer's first reaction to any inspection problems is to walk away, this is a good time to remind them of why they were moved to make an offer in the first place. With inventory as tight as it is in many areas, they may regret letting any inspection issues derail their dream. If this is the only property they have seen that meets their requirements, it is best to talk it through and make it work.