Real Estate MauiNow: Ask the Expert: Should I Hire a Home Inspector Before Listing?
Answered today by Dave Futch of Coldwell Banker Island Properties
Dear REMN Expert,
Q: Linda asks, “As a Seller, should I hire a home inspector before listing my house?”
A: Approximately 25% of the real estate transactions don’t make it to their closing.
Typically, Buyers cancel the transaction because of one of two reasons:
1. Approximately 25% of the cancelled transactions fail due to the Purchase Contract’s finance contingency. Either the Buyers – or the property itself, don’t qualify for the loan.
2. Approximately 75% of cancelled transactions fail due to the Purchase Contract’s inspection contingency. During the home inspection, they discover certain physical property flaws that are then highlighted with text and photos in the inspection report. The well-advised Buyer hires a licensed contractor to quantify the cost to remedy the flaws and quite often attempts to negotiate these costs with the Seller.
Many times they fail to come to terms with the Seller and cancel the transaction, without losing their earnest money deposit.
Since the overwhelming reason for escrow cancellations come from the Buyer’s discoveries during the inspection, logic indicates that having the inspection before listing, correcting the “deal-killer” items is a prudent move. Once flaws are revealed, questions arise and confusion sets in. “The confused mind says no!” Remove the flaws and remove the confusion, thereby building confidence in the Buyer’s mind, insuring the completion of the transaction.
Going back to market after the cancellation sends a message to subsequent Buyers that creates doubt and makes the new negotiation that much more tricky. Plus, the flaws will need to be included in the updated Seller’s Disclosure for the Buyer’s review, setting the tone early in the escrow process, repeating thoughts of concern and confusion … and the cycle starts all over again.
So the moral of the story is, consider being one of the sharp Sellers and have your property inspected, then eliminate the flaws and enjoy smooth sailing in your transaction. Time is money and this step saves both!
Todays question was answered by Real Estate Expert Dave Futch of Coldwell Banker Island Properties. http://www.davefutch.com/ 808.280.9600
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