When preparing your property for sale, it is always a good idea to hire a professional home inspection and/or pest inspector to conduct a comprehensive report on your home’s condition. Why?
To sum it up, the more a buyer knows about a property upfront, the more likely your sale will be smooth and hassle-free. You know your property’s good and bad points and so does the new buyer. They will write the offer with this information in mind. Surprises rarely work out well for anyone in real estate sales.
For example, you list your single family home for $1,000,000 but do not conduct a pest inspection because you feel the property is in fine condition. A buyer comes along and writes you an offer for your full asking price. Yay, we’re in escrow and you’re on your way to a very profitable sale! Now, hold on a minute b/c in the first week of escrow the buyer conducts an inspection which is a contingency of her/his contract. The inspection turns up dry rot on the deck, back stairs, and window sills, amongst other items. The pest inspector quotes in their report that the damage will be $15,000 to fix!
Your buyer is now upset, scared, and more importantly, surprised. They thought your place was “perfect” when they made their offer. To them, this is new, material information. If you are lucky enough that the buyer doesn’t immediately walk away, you will be unlucky enough that he or she will want YOU to pay for the damages.
What if you say you want to kick them out and find someone new? Well, even if you can, you are now stuck with the pest report and must disclose it to future buyers who will no doubt factor this into their price. Not to mention, the pain, anxiety, and extra time on the market this caused you.
Most likely, you will end up negotiating and giving the buyer all or part of the pest work funds. This is especially true in a slower-paced market.
Had you had the inspection up-front, the price you got in an offer would have been based on this knowledge. You may have gotten the million dollars anyway! Regardless, you would have saved time, stress, and money.
Moral of the story, listen to your good agent who should tell you to get an inspection!
For more proof in the pudding, see Bob Bruss’ colum in last weekend’s Chronicle Real Estate section. http://sfgate.com/cgi-bin/article.cgi?f=/c/a/2007/01/21/REGDLNJJ3B1.DTL