With this raging real estate market, prospective home buyers are willing to waive their home inspection in order to make their offer seem more attractive. Is this a good idea? Adam explains the ramifications of waiving a home inspection when purchasing a home.
Narrator: It’s time once again for the “Crack Man Podcast” hosted by A1 Foundation Crack Repair. I’m Darren Kincaid here with the Crack Daddy himself, Adam Tracy. Adam and The Crack Man Rich have over 30 years’ experience in the construction industry. Rich as over 25 years as the president and founder of A1 Foundation Crack Repair. This podcast provides expert basement waterproofing, concrete repair, and preventative maintenance tips for homeowners and businesses. A1 Foundation’s valuable insight will help avert a disastrous flood within the basement, health problems associated with water infiltration, and protect your biggest investment….your home. The topic of today’s podcast: Should I waive my home inspection?
Narrator: So, Adam, I guess with this raging real estate market, prospective home buyers are willing to waive their home inspection in order to make their offer seem more attractive. Is this a good idea?
Adam: I would generally say no. You’re right though, the housing market in New England, specifically Massachusetts, Rhode Island and Southern New Hampshire has been extremely competitive. The inventory is very low which is driving prices up, and there’s a lot of buyers, not a lot of sellers. Not only are the prices exploding in the region, a lot of people are trying to make their offers more competitive and get creative with certain types of closing dates and all that kind of stuff. But one thing that we’re seeing more often are people foregoing or waiving a home inspection.
Waiving a home inspection is not for everybody, especially somebody who may be a first-time home buyer or not incredibly aware of the idiosyncrasies of owning a home. So, what is happening in our industry is that we’re finding that a lot of people get into the P&S process where they have an accepted offer and they have about 4 or 5 days to basically go through the house to make sure everything is what they want it to be before they have any sort of continuances put on to the sale. And because a lot of these home buyers are waiving their home inspection, they don’t have an opportunity to kind of go through the house to fine-tooth comb, to find things that might be both on the minor scale and also on the major issue scale as well.
Relative to foundation issues, I can speak to a couple cases here very recently, where there was a home buyer and a fieldstone foundation, and they love the house, and it was in towards Boston and everything was great, they had an offer accepted, waived the home inspection, and then they asked, “Hey, would you guys come in to look at the foundation”? So we didn’t have an opportunity to meet the time window because it was only a 24 hour time window, but we were able to get some information from the realtor and also from the prospective buyers. And come to find out that this foundation had some major structural issues with it, that would have been very easily caught by a home inspector to flag it as a deficiency to the home, but these people were kind of locked-in at this point and it actually ended up being well beyond our scope of repairs and it was in the order of 20 to 30 thousand dollar repairs. So, what we’re finding is that, while trying to make a very competitive offer, home buyers are sometimes being stuck with major upgrades that are necessary, not just as a precaution - “Hey, you might want to think about this 5-10 years down the road”, but immediate safety in your structural concerns, roof concerns, plumbing concerns. And what is happening in general is that because home inspections are being waived, industry experts in this field are asked to be brought in, which is tripling and quadrupling the cost of basically getting a guy out there as an expert to evaluate the plumbing, or the electrical, or the roof, or the foundation, or the siding, or the windows. So you’re trying to coordinate all these people coming in in a 24, 48 hour window. Not everyone can accommodate that because you’re trying to coordinate industry experts, and you’re also spending 3-4 times the amount just to get basically a consultation.
So, what we’re finding is that most of the issues can be pretty well resolved, but there are a lot of cases where the home inspection would’ve caught some major bombs in the house that would inhibit somebody from really considering purchasing the house, rightfully so, unless they had the means to spend another 30, 40, 50 thousand dollars on upgrades. Because that’s the hidden danger of this, is that you’re not necessarily, you may fall in love with the house but are you prepared to spend tens of thousands of dollars in repairs to safely live in the house? And that’s what a home inspection is really for.
I understand that it’s a competitive market, but it is a huge risk to take to own a house that you may or may not be able to move in right away because you may have some safety concerns as you live in there. So, certainly something that you can weigh as an option to make yourself more competitive in the market. But in terms of what risks there are, there are huge risks and if you’re not familiar in specific to foundation issues and what could be presented in a foundation issue, whether it’s an old 1800’s home or brand new construction, then you really need to make sure that you’re getting somebody in there professionally, whether a home inspector and/or an industry expert to evaluate that issue because, again, you don’t want to get caught with a huge bill after you just already spend over asking on a house. So that’s the reality of the situation, it’s a personal choice but something that you should weigh heavily as to whether or not is the right choice for you.
Narrator: Yeah. Nobody wants to buy a money pit, right?
Adam: That is true.
Narrator: Okay. Well, thanks Adam for explaining the ramifications of waiving a home inspection, particularly if you’re trying to make that home purchase offer more attractive.
Narrator: If you have a basement water problem and think you need a professional, or, if you’d like more information on foundation crack repair and basement waterproofing topics, please visit A1FoundationCrackRepair.com or call Rich at (866) 929-3171. Or you can email Rich at info@a1foundationcrackrepair.com. Thanks for listening and keep that basement dry.