From Spotlight: Reviewing Offers & Negotiating

A Seller’s Guide to Navigating the Home Inspection

Passing the inspection advances you to the next level: closing the deal on your house.

Illustration depicting common home inspection aspects such as appliances, chimney problems, and electrical concerns.
Image: HouseLogic

Getting beyond the home inspection is sort of like advancing to the next level in a video game.

When you get past this step, you get to advance to a fresh, exciting place — your new home, to be exact.

Sellers and Buyers Have Stakes in Every Inspection

Once you've accepted a buyer's offer, your home will get a once-over from the buyer’s home inspector. The inspection is usually a contingency of the offer, meaning the buyer can back out based on serious problems discovered. The lender also expects an inspection to make sure it’s making a good investment. Makes sense, right? 

During the home inspection, an inspector will examine the property for flaws. Based on their report, the buyer will give you a list of repair requests. 

Your agent will work with you to negotiate those requests. Don’t want to be responsible for a repair? (Maybe it’s best if the buyer has the fix made by their own contractor anyway.) Your agent may be able to negotiate a price credit with the buyer instead. 

By the way, inspections aren’t necessarily a big, scary deal. Your agent will help advise you about repairs you need to make before the inspection. In fact, they may have recommended them to you even before you put the home on the market. And if you’ve been maintaining your home all along (and you have, right?), your punch list may be minimal.

In addition, back when you put the home on the market, you were required to disclose to buyers the home’s “material defects” — anything you knew about the home that could either have a significant impact on the market value of the property or impair the safety of the house for occupants. Material defects tend to be big underlying problems, like foundation cracks, roof leaks, basement flooding, or termite infestation.

What a Home Inspection Covers Depends on the Home

Every home is different, so the items checked during your property’s inspection may vary. But home inspectors typically look at the following areas during a basic inspection:

  • Plumbing systems
  • Electrical systems
  • Kitchen appliances
  • Heating, ventilating, and air conditioning, or HVAC, equipment
  • Doors and windows
  • Attic insulation
  • Foundation and basement
  • Exterior (for example, siding, paint, outdoor light fixtures)
  • Grounds

Depending on the sales contract, the purchase may also be contingent on a roof inspection, radon inspection, or termite inspection.

What a home inspection won’t cover is the unseen. Your inspector won't rip open walls or mountaineer on the roof. (Though that would be kind of exciting to watch.)

Related Topic: Sell a Home: Step-by-Step

So, What Do You Need to Fix?

A home inspection report is by no means a to-do list of things you must address. Many home repairs, including cosmetic issues and normal wear and tear, are negotiable. 

But after a home inspection, sellers are typically required to deal with three occasionally overlapping types of repairs:

  1. Structural defects. This is any physical damage to the load-bearing elements of a home. These issues include a crack in the foundation, roof framing damage, and decaying floor boards.
  2. Safety issues. Homes for sale have to meet certain safety standards. Depending on where you live, safety issues that you, the seller, may have to address could include mold problems, wildlife infestation, or exposed electrical wiring.
  3. Building code violations. You must address building code violations — such as the absence of smoke detectors, use of nonflame-retardant roofing material, and use of lead paint after 1978.

Again, addressing these might take the form of a credit on the price, which in the case of structural issues, could be sizable. 

Use This Checklist to Prepare for a Home Inspection

So, are you ready for the inspection? You will be if you take these steps (with your agent’s assistance): 

  • Assemble your paperwork. Transparency is key. Ideally, you’ll have summaries or invoices of renovations, maintenance, and repairs you’ve done on your home that you can provide to the home buyer. Collect this documentation in a file and share it with the buyer.
  • Make sure your home is squeaky clean. Your home should be pristine when the inspector arrives. A good first impression will set a positive tone. Take time to declutter and deep clean the whole house. A deep clean (stuff like cleaning the range hood and upholstery and sanitizing garbage cans), averages $200 to $400, depending on the size and condition of your home, according to Angi. 
  • Remove any obstacles that may block . Take measures to ensure the inspector can easily access all facets of the property, including electrical panels, attic space, and fireplaces. This may require temporarily moving clothing and other items that impede access.
  • Leave the utilities on. For the home inspector to test items such as the stove, dishwasher, furnace, and air conditioning system, the utilities must be connected regardless of whether the house is vacant. Otherwise, the inspector may need to reschedule, which could push back closing. 
  • Fix minor problems ahead of time. Many cosmetic issues — say, a broken light fixture or a scratch on the wall — are minor and easy to fix. But they can cause buyers to be concerned about how well you’ve maintained other areas of the home. It’s best to take care of small problems yourself before the buyer’s inspection.

Do Your Own Inspection Before the Inspection

Some sellers choose to hire their own home inspector to check the property before their house is even listed. This is called a “prelisting inspection,” and it has several advantages:

  • It can give you time to fix deal breakers. Granted, a pre-inspection costs money — typically $350 to $500, according to REALTOR® magazine. The cost is the same as a home inspection and varies according to your location and the size of your house. That said, it can enable you to address major issues that could cause a buyer to retract their offer. Big problems may include mold, water damage, or foundation cracks. 
  • It can mean fewer surprises — and help you market your home. Knowing what needs to be fixed in your home in advance will allow you to be upfront with buyers about any big pre-existing issues, which can give buyers peace of mind. You can also make it known to prospective buyers that consideration for those items has already been factored into the sales price.
  • It can speed up the negotiation process. Having a prelisting inspection can help reduce, or even eliminate, the time-consuming process of back-and-forth negotiations.

If you discover any material defects in the property during a prelisting inspection, you're legally required to disclose them to buyers — even if you fix them. Also the buyer’s inspection may reveal things yours didn’t find. The choice to do a prelisting inspection is yours, but it never hurts to get a head start on repairs.

Be Aware of These Tried-and-True Tactics for Negotiating Repairs

When it comes to repairs, your agent will haggle with the buyer’s agent for you — though ultimately you will decide how you want to respond to the buyer’s home repair requests.

Here are four time-tested negotiating techniques your agent may deploy to protect your best interests — without reducing the sales price:

  1. Agree to make reasonable repairs. Unless your house is flawless — and the reality is no one’s house is — prepare to receive repair requests from the buyer. You don’t have to offer to fix everything the buyer asks of you, but take responsibility for major issues.
  2. Offer a closing cost credit. Don’t want to deal with the hassle of making or ordering home repairs yourself? Ask your agent to offer the buyer a credit at closing for the estimated costs. This can also help you avoid complaints from the buyer over the quality of the workmanship, since you won’t be overseeing the repairs.
  3. Barter. One way to smooth things over with a buyer and keep the deal moving forward is to offer something of value that’s unrelated to the requested repairs. For example, if you know the buyer loves the new couch or bedroom set you bought, you could offer to leave it behind in exchange for making fewer repairs.
  4. Leverage the market. You may have more negotiating power depending on where you live. In a hot seller’s market, for instance, you might be in the position to offer the buyer fewer repairs, especially if you have another buyer eager to make an offer. 

Home inspection may sound like a burdensome process, especially when you’re so close to your goal. But when you cross it off your list, you’re more ready than ever to jump to the next level — and into your life’s newest phase.

You May Also Like:

First-Time Buyer by NAR
HouseLogic logo

HouseLogic helps consumers make smart, confident decisions about all aspects of home ownership. Made possible by REALTORS®, the site helps owners get the most value and enjoyment from their existing home and helps buyers and sellers make the best deal possible.