Why Do a Pre-Listing Home Inspection?

Jul 26, 2021

Should sellers get a pre-listing home inspection? It’s an incredibly common question, and with good reason. Pre-sale inspections are technically an extra step, as sellers – unlike buyers – usually aren’t required to handle any inspections on their own.

However, a pre-listing home inspection is an extra step that’s worth taking. After all, prospective buyers almost always have one done and often ask for price reductions or repairs based on the results. Why not beat them to the punch?

By getting a pre-listing home inspection, you’re creating opportunities that other sellers don’t get. Not only will you learn more about the exact condition of the property, but you’ll also have a chance to take action to improve the value of your home.

If you want to know if a pre-sale home inspection is the best move for you, here are some pros and cons to consider.

Pros and Cons of Getting a Pre-Listing Home Inspection Before Your Home Hits the Market

Why Do A Home Inspection Prior To Listing Your Home For Sale

Pre-Listing Inspection Benefits

When it comes to seller’s inspections, most want to know about the pre-listing inspection benefits. Here is a quick overview of everything you have to gain by scheduling one.

1. Knowing the Condition of Your Home

There’s one big reason why buyer home inspections are scary; they might reveal an issue with the property that derails the sale. In most cases, seller anxiety around buyer home inspections is completely justified. If the buyer learns something they don’t like, they might walk away without another word.

Luckily, sellers can avoid this entire scenario. With a pre-listing home inspection, you can find out about any potential issues before anyone else views the house. It’s a chance to get to know the genuine state of the property, reducing the odds of any unpleasant surprises later.

Just make sure you work with a reputable home inspector. Thoroughness and honesty are both musts. That way, you get an accurate picture of the condition of the house.

2. Setting an Accurate Price

Usually, one of the hardest parts of selling a house is choosing the right price. While you can learn quite a bit by researching comparable properties – or comps – that isn’t always enough. In some areas, well-matched comps are few and far between. Additionally, every home is unique, including when it comes to features, condition, and more.

By getting a seller’s home inspection, you gather up critical details about your property. Any issues are clearly identified, eliminating some of the guesswork.

When you give a pre-listing home inspection to a real estate professional, they can use the information to find the best price point. That way, you’ll be able to find the sweet spot, ensuring you are listing too high and scaring buyers away or too low and missing out on potential money.

3. Reducing Stress During the Selling Process

Selling your home is a multi-step process and can also be an emotional journey. Often, it’s challenging enough even when everything goes perfectly.

If you add in the fact that something unexpected often arises, your anxiety goes up. Any unknowns make the steps more stressful, creating sources of worry.

In many cases, a buyer’s home inspection is one of those unknowns. However, you can find out what you need to know in advance by getting a pre-listing inspection. It can give you more peace of mind, eliminating one of the major question marks in the equation.

4. Completing Repairs to Increase the Value of Your Home

Commonly, real estate agents encourage sellers to handle any needed repairs before listing the home. Otherwise, when the buyer’s inspection reveals an issue, there’s a good chance they’ll reduce their offer to compensate for the required work or ask that the repairs be handled before the sale closes.

In either of those cases, sellers are often left scrambling. They either have to rush to fix issues or accept a sale price under what they wanted, neither of which is ideal.

By getting a pre-listing inspection, you can discover the issues that buyers would find in theirs. Then, you can handle repairs on your schedule, ensuring you don’t have to rush to find a contractor and complete the work.

Plus, you can be confident in your list price. You’ll know that the critical defects are resolved, and that makes a world of difference.

5. Shorter and Simpler Negotiations

One of the main negotiating points during a home sale occurs after the buyer’s inspection. They use the results as leverage, attempting to secure a lower price for the property or requesting other concessions. It’s a common part of the process.

Negotiating isn’t typically fun. In fact, it is usually very stressful and may even feel like a personal attack. This is especially true if the buyer focuses on issues that seem unimportant.

With a pre-listing home inspection, you can actually simplify negotiations. If you address the problems, there will be fewer issues on the buyer’s report, giving them less leverage.

If you choose not to fix any problems, you can inform the buyer of your results earlier in the process. While this doesn’t eliminate negotiations entirely, it usually shortens them significantly as the buyer is well aware of the property’s condition before the first offer.

6. Boost Buyer Confidence from the Beginning

After you get a seller’s inspection, you have a powerful tool in your hands, one that can put buyer’s minds at ease. By providing them with a copy of your home inspection report, you’re being upfront about the condition of the property.

Many buyers approach potential home purchases with a skeptical eye. They assume sellers aren’t being forward about issues and are instead looking for any advantage to secure a higher price.

When you provide a copy of the report, you are putting everything on display. It shows you have nothing to hide, and that can make a difference.

Additionally, buyers may worry about issues that would cause their lender to refuse to fund the purchase. Many lenders have rules regarding the property’s condition, and certain problems are disqualifying.

By sharing a seller’s inspection report, you can show that troubling issues like that either don’t exist or are resolved. That can make buyers feel better about their financing options, especially if they are working with a stricter program or lender.

7. Set Your Real Estate Agent Up for Success

While your real estate agent has likely handled plenty of sales that didn’t involve a pre-listing inspection, that doesn’t mean getting one isn’t a good idea. By having that report ready, your agent gets a clear picture of your home’s condition.

With that information, they can advertise the property properly, set the best listing price, and negotiate with greater ease. Plus, they could showcase the report in the listing, using it to attract buyers.

Finally, they can provide you with guidance about whether any issues are worth addressing pre-sale. Some findings may not deter buyers as much as others. Your real estate agent can use their expertise to help determine which fall into each category, something that can be ideal if your repair budget is limited.

Why Do A Home Inspection Prior To Listing Your Home For Sale

Pre-Listing Home Inspection Drawbacks

While there are plenty of pre-listing inspection benefits, there are also a few drawbacks. Here are some of those that you need to consider.

1. The Pre-Listing Home Inspection Cost

Getting a home inspection does cost money. Additionally, it isn’t a cost you can pass onto the buyer. While it puts a buyer’s mind at ease, it isn’t something you can take on as a fee. Plus, buyers usually have to fund their own inspections.

Now, most would argue that the pre-listing home inspection cost is worth shouldering. By having one, you get to experience all of the benefits above, which can easily make it worthwhile.

Precisely what your pre-listing home inspection will cost can vary. Generally, somewhere in the $400 to $1,000 range is typical. However, you may pay more or less depending on your location, the size of your house, and whether you want certain add-ons like:

  • Radon Air & Water Tests
  • Septic Tank Inspections
  • Well & Water Tests
  • Plumbing Inspections
  • Mold Tests
  • Lead Paint Checks

Whether those add-ons are necessary may also depend on your location. Additionally, the age of your home or its critical systems might play a role.

2. Disclosure Laws

Disclosure laws vary from one state to the next. However, in areas where they are in place, they can mandate that you share every detail about what your seller’s inspection uncovers.

Whether disclosure laws work against you largely depends on what is discovered and whether you can afford to address the issues. If you handle all of the outlined repairs, disclosure laws aren’t a hindrance. You can show that the work is complete, demonstrating that the defects were taken care of before listing.

However, if an issue is significant and repairing it isn’t within your capabilities, disclosure laws could require that you make the problem known to buyers upfront. This can make marketing your house a bigger challenge, as the defect may cause potential buyers to bypass your property.

In New York, disclosure laws aren’t typically a concern. New York is a “caveat emptor” state, meaning that sellers aren’t required to voluntarily disclose details about issues if the buyer doesn’t ask about them. The only exception is the presence of lead paint, where disclosure is required.

However, if a buyer asks questions regarding the home’s condition, New York sellers and real estate agents have to provide honest and accurate answers. Hiding the truth isn’t allowed, and lying is prohibited.

Real estate agents also must adhere to a higher standard. They are required to make prospective buyers aware of issues if they know they exist.

In many cases, disclosure laws aren’t as significant of a problem as they may appear on the surface. Ultimately, buyers traditionally get their own home inspections, so they will likely learn about the defects in the end.

As a result, revealing the truth beforehand doesn’t cause harm and, by being straightforward about the situation, could actually work in your favor. It positions you as an honest seller, creating a higher level of trust during the deal.

3. Your Home Will Undergo Two Inspections

Some sellers worry about getting a pre-listing home inspection because it means their house is inspected twice. After all, there’s always a chance that the second inspector will have a different perspective on the house’s condition or may spot something the first overlooked.

Additionally, the second inspector may not see a defect the first one caught. If you revealed that issue to the buyer, they are aware of a problem they wouldn’t have learned about otherwise, and that may impact negotiations in a way that could’ve been avoided.

Finally, inspectors approach their role in the process differently. Even if two inspectors discuss the same problem, one may be more straightforward, while the other may use language that inspires higher levels of concern in the buyer. Some actually speak in a frightening way intentionally, even if it isn’t particularly professional to do so.

Ultimately, you won’t have any say when it comes to the buyer’s inspector. However, that doesn’t mean having your own inspection isn’t a good idea. In some cases, your report may have a more accurate representation of the situation, which may actually help put the buyer’s mind at ease. It gives everyone access to more than one perspective, and that could make it easier to see if something is being exaggerated.

Should You Have a Pre-Listing Home Inspection? The Answer Is Usually “Yes”

While a seller’s inspection can come with some potential drawbacks, the pre-listing inspection benefits typically outweigh them. It makes being proactive possible, creating opportunities to handle repairs, find a fair price, and more.

If you want to learn more about whether a pre-sale home inspection is right for you, speak with one of the Pricing Strategy Advisors (PSAs) here at Global Property Systems. They are our Listing Team Leaders and will help you determine which approach is best for your situation. Give us a call at 845-306-5413 to be directed to your Local Area Specialist.


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