All About Home Inspections for Buyers
Why should you get a home inspection when buying a home?
It is always the safest decision to have an inspection contingency included in your offer. (You can read more about inspection contingencies here.) Keep in mind, however, that an inspection does not guarantee the condition of the home; instead, its purpose is to educate you regarding the home’s current condition, and how to maintain it in the future. Inspections are completed within a contractually-specified time period—typically 10-15 days. Inspection reports are often included by the sellers and listing agent in the disclosure packet, but these disclosures do not always include all inspections that could be done. While a contractor’s inspection and pest reports are most common, there are other inspections that buyers may elect to complete, such as a fireplace, sewer lateral, and/or mold inspection (check out the list later in this blog post).
If you are satisfied with the condition of the property, you will then remove the inspection contingency and proceed with the sale. If you are not satisfied, you may cancel the contract or negotiate with the seller. In a negotiation, the purchase price may be adjusted, a credit may be given in escrow, or the seller may perform work prior to close of escrow.
Who is responsible for requesting a home inspection?
Luckily, in San Francisco much of the due diligence on the property is done prior to getting into contract. Some buyers ask to perform inspections on the property before submitting an offer. This is tricky in situations where there are several other interested parties and timelines move quickly. That said, it can be done. Buyers are then responsible for performing additional due diligence during the escrow period. Along with the careful review of disclosures, documents and reports provided by the seller and agents involved, inspecting the property is the most important part of such due diligence.
The Purchase Agreement typically contains provisions allowing you to perform any inspections and investigations you desire to ascertain the condition and circumstances of the property you are in the process of purchasing. Performing such due diligence with qualified professionals is absolutely vital to avoid unpleasant (and often expensive) surprises after close of escrow. There still will be hurdles to overcome, even after adequate due diligence and detailed inspections are performed. Understanding the general condition of the property upfront will help minimize surprises.
Who pays for the home inspection and how much do they cost?
Oftentimes the seller will provide pre-sale inspection reports to prospective buyers during the marketing period of the home. If these reports are not provided, or the buyer wishes to conduct additional inspections, the buyer pays for those inspections. Pest control inspections generally range from $350 to $700 and contractor’s inspections range from $400 to $1000, depending on the size of the home. It is important to use qualified professionals, and we can recommend inspectors in every category.
Common inspections: pest inspection and general contractor’s inspection
Like we mentioned previously, the two most common inspections are the structural pest control inspection and the general contractor’s inspection:
- Pest control inspection
Sometimes referred to as a “termite report,” it examines all types of insect and fungus (water) damage as well as conditions that could lead to damage. This inspection is performed by a specially-licensed contractor who must inspect properties according to criteria established by the State Board of Pest Inspection.
- Contractor’s inspection
A general contractor’s inspection will check the overall condition of the home from the foundation to the roof, including electrical, plumbing and heating, the basic structure, as well as the quality of the finish work. It is important that you use a professional who specializes in home inspections in the area in which you are purchasing, is bonded, and is a member of one of the major home inspector associations. Do not use a regular contractor (such as your brother-in-law) as there is a huge difference between building and repairing homes and inspecting them thoroughly for issues pertinent to the home purchase decision. The inspection period is also useful for obtaining estimates for repairs and improvements you plan to make later. Because inspection periods are generally 10-15 days, getting a contractor in to quote a larger project is not always feasible.
When would you consider an offer without inspection contingencies?
There are just a few situations in which one would consider forgoing the inspection contingency:
- The seller provides the buyer with high-quality inspection reports by a well-known and highly-respected local inspector that the buyer’s agent had included on his/her list of inspectors. These reports should be current, comprehensive, and carefully reviewed for caveats and disclaimers. A walk-through with the inspector, or minimally a buyer-inspector phone conversation reviewing the reports, is still advisable. This way, the buyer has no unanswered questions and feels confident they now understand the condition of the property.
- The buyer performs complete inspections using qualified professionals prior to making an offer.
- The buyer plans to tear down or perform such comprehensive remodeling that they do not care about the current physical condition of the property. Though, even then, the buyer may wish to investigate permit issues with the Planning Department as part of their inspection contingency.
Do not forgo inspection contingencies for these reasons
These situations may seem like valid reasons to skip the inspection contingency, but we do not recommend it:
- Having a friend/family member who is a contractor look at the property is not a valid reason to forgo comprehensive inspections. There is a huge difference between being a contractor and being a highly-experienced home inspector—especially in San Francisco with its incredible variety of styles, age, and architecture. Besides which, if there is a lawsuit regarding property condition, your friend/family member will probably be brought into it.
- A description of “totally remodeled” or “extensively remodeled” is not an excuse for skipping inspections. Or, that the property “looks like it’s in perfect condition.” Many buyer lawsuits pertain to new construction and recently remodeled properties. One cannot know what the condition of a property is, no matter how it appears, without having comprehensive inspections by qualified professionals. It is in everyone’s interests – buyer, seller and brokers – that the buyer fully understands the true condition of the property prior to the completion of the sale.
Other common inspections you may consider
- Structural engineer
- Roof
- Environmental hazard
- Review of building permits
- Sewer line
- Fireplace
- Lot line survey
- Furnace
- Mold
Here’s where a good agent comes in
Sometimes the idea of inspections and reports can feel overwhelming when you are in the process of buying a home. Your agent is there to help guide the process. As top ranked buyers agents in San Francisco, we use our years of experience to help support our buyer clients all throughout their exciting journey. It’s what we do! Thinking of buying (or selling)? Call the Krishnan Team at 415-735-5867 for a no-obligation consultation. You can also email us at info@ruthkrishnan.com.
