Do Home Inspections Really Affect Property Value?

Can a home inspection affect the sales price of that home you are about to sell? The short answer is yes, it can. But you don’t have to let it.
 
You can achieve this when you understand what the home inspection is, why buyers want a house to be inspected, what home inspectors look for in the property, and the advantage a home inspection gives to the buyer during the home buying process.
 
If you are reading this, chances are that you are a homeowner on the verge of selling your home and you are concerned about how much control you have over the eventual sale price of the property. Like every seller, you want to do everything to avoid events that could force you to sell the home below your desired price. And the one event that has the power to do that is the home inspection.
 

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• If the inspection report shows a lot of issues with the home, the buyer may decide that the home is not worth it and walk away. If the buyer does this, they will not lose their earnest money, since the purchase was contingent on the result of the home inspection.
• Secondly, even if the inspection report reveals problems, the buyer may decide that the home is still worth its price. In that case, he/she may request the seller to make repairs to the home. This will cost the seller even if it doesn’t change the home's sales price.
• Thirdly, the buyer may decide that even though they still want to buy the home, based on the inspection report the property is not worth the agreed price. The buyer may then try to renegotiate with the seller to pay a lower price, thereby reducing the home's value.

​Regardless of whether a seller conducts a prelisting home inspection or not, most homeowners already have a fair idea of the problems that exist with their home. By being honest with buyers and letting them know about the existing problems before the home inspection, sellers help themselves in two ways. Firstly, they build trust with the buyer, and secondly, they give buyers the chance to factor in the cost of fixing the problem when making their offer. This ensures that the buyer has a fair idea of the condition of the home and the home inspection becomes a mere formality.
 
In conclusion, the main thing buyers want to know when they conduct a home inspection is if the seller's information about their home is complete. The more you know about your home, the less power the home inspection has to lower its sales price. If you want to relieve yourself of the stress of worrying about the home inspection, take control of the situation by knowing more about your property.

What is the home inspection and why do buyers have them?

​The home inspection is that part of the home buying process where the structures and systems of a home are meticulously examined by a professional home inspector for any flaws that the seller may have failed to disclose or is unaware of. It involves a thorough examination of all parts of the interior and exterior of the home.
 
The two reasons that buyers want the home inspection done are trust and maximizing value. As with all financial transactions, there is mutual distrust between homebuyers and sellers. As OmniKey Realty explains, buyers are never sure when sellers are disclosing the full information about the details of a home. Therefore, the buyer seeks the opinion of a neutral third party about the actual condition of the home in order to determine its true value.
 
Based on the outcome of the inspection - the home inspection report - the buyer can come to the following conclusions about the home:

What can sellers do about this?

 

• They can do a pre-listing home inspection

Through the home inspection, buyers can present facts about a home that the seller did not know or did not disclose. This puts the seller on the back foot and gives the buyer the advantage. But sellers can prevent this by conducting a home inspection of their own before listing the property. Rather than wait for the buyer to conduct any inspection and surprise them with the result, the owner takes the proactive step of discovering the true condition of their home.

• They can carry out repairs

Instead of only focusing on improving the appearance of their home and upgrading parts of it, sellers can carry out strategic repairs. Based on the result of the prelisting home inspection, the seller can identify which issues have the most ability to negatively impact the sales price of their property. They can focus their efforts on fixing these important issues. By doing this they eliminate or reduce the likelihood that a buyer will be able to successfully renegotiate their property's price.

• They can be upfront about problems