Congratulations! Your offer has been accepted and you are ready to move on to the next step. When working with your agent on your offer consider first the importance of making it conditional upon a home inspection. At a glance, a property inspection can seem like a daunting (and relatively expensive) step, particularly for those who have never gone through this process.
The following is a breakdown of the more important things every home buyer should know about property inspections, how to read them, and what to do with the results:
Benefits of Having a Home Inspection Done
- Enables you to make a wise investment. The duty of a home inspector is to find the issues with a specific home. This will help you avoid ‘lemon’ houses whose repairs could wreak havoc on your finances.
- Allows a re-opening of negotiations for money savings. If home inspectors find a major problem or a large number of minor problems, issues that do not impact the structural integrity of a home but do need to be addressed, it can re-open price negotiations. Once shown the inspection results, sellers may either offer to pay for the repairs themselves or lower the purchase price.
- Ability to plan ahead with confidence. If the results of the home inspection are positive with no problems found, then homeowners can move forward with confidence about their purchase and eliminate feelings of buyers’ remorse. If the home inspection results find only minor and fixable issues then, even if the seller refuses to lower the price or repair, home buyers can still move forward with greater knowledge and confidence in knowing exactly what problems they will encounter upon closing.
How to Read a Home Inspection Report
The home inspection report will be presented in one of two formats: Checklist and Narrative. Below is a quick look at the difference between the two and how to read them:
- Checklist Report. A checklist home inspection report resembles its name: it is a document that lists the items and areas of the house that have been inspected with an inspection rating next to each listing. Generally the rating will be limited to simple indication of ‘good’, ‘fair’, or ‘poor’, with more detailed commentary at the end of report. However, because it does generally lack in-depth information, you may need to contact the inspector for further details or the answers to any questions of ratings.
- Narrative Report. The narrative home inspection report is much more detailed of the inspector’s findings. In most cases, the report will describe step-by-step the items and areas that were inspected, how they were inspected, and what was found. Due to this greater detail and thoroughness of the process, some homeowners may find it a bit more overwhelming due to unfamiliar terminology and descriptions. As such, it may be necessary to contact the inspector for a break-down of certain phrases and found problems.
What to Do with the Results
Share the results of your home inspection with your realtor, financier and lawyer. Your realtor in particular will help you analyze the report’s findings. From here you can decide if you will walk away from the deal and seek out another home, or negotiate a lower selling price. If major repairs are needed, talk to your financier about extending the home loan to cover repairs.
Are you interested in learning more about home inspections? Or do you need help finding a home inspector for your future home? Contact Elli Davis at Royal LePage here to get the information you need for your next big investment.