Top 3 Reasons A Home Inspection Kills A Deal
One of the most difficult parts of being a home inspector is delivering bad news, but it’s part of the job. When you’re hired to evaluate the condition of a building for a prospective home buyer, there are often tens of thousands of dollars at stake, plus emotional turmoil for the buyer. It’s a job that has to be performed critically and objectively, even if the discoveries made during the inspection lead the buyer to terminate their contract.
Experienced home inspectors work hard to be thorough and clear; we don’t want a client to be scared out of buying a perfectly good house that has routine maintenance issues. At the same time, we want our clients to understand what they are getting into with the purchase of a house.
In my experience, there are three common reasons a home inspection kills a deal.
1. The house is not actually what it looks like
The most common example of a house that looks like one thing, but in fact is something else, is the flipped house.
When homes are purchased to be flipped, they are often bought at auction and seldom have inspections done prior to purchase. This means a company gets the house and decides what to update based on what they can sell it for and not what the house needs in terms of updates and repairs. During the home inspection I sometimes find flips in need of structural repairs or discover chronic moisture problems that were covered up in an effort to sell the house. On the outside everything looks new and shiny, but there may actually be deep dysfunction lurking in the bones of the house.
Above you can see carpenter ants swarming below a recently flipped house.
Another example of houses that are not what they seem are houses that began as humble vacation homes and have been remodeled and added onto multiple times over the years. One way to ferret out these homes is to think about what a given neighborhood was like when the home was built. Older homes like this were often constructed with small budgets and with a humble point of view and may not have been built with the expectation that they would last for hundreds of years or sell for hundreds of thousands of dollars. These houses may look bright and shiny and fancy after dozens of additions and remodels, but underneath there can be a hodgepodge of foundations, additions and rooflines that make them fundamentally different than they appear. These are not “bad houses” but they are often quirky and may present risks that buyers weren’t anticipating. One tip that often gives these homes away is a quirky roofline that shows obvious additions.
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Dysfunctional and quirky rooflines like the one seen above often belie dysfunctional and quirky houses.
2. There May Be More Repairs and Updates than the Buyer Anticipated
The best example of this problem is the 20-year-old house that has not been updated. I can hear the refrain from my clients, “but it’s only 20 years old!”
In fact, most 20-year-old homes are not bad houses, but they do often require expensive systems updates. This is because many house systems only last 15-20 years. Common systems that require replacement after 20 years are: the roof, deck, furnace and appliances. I also find that after 20 years carpets are stained and worn thin, hardwood finishes are scratched and interior paint needs updating.
These are all disposable systems and are in no way indicative of a “bad house,” but if the owner you are buying from has not been picking away at these systems, you can be left with some expensive updating. Add to this the fact that many homes built in the 90s were sided with a Hardboard siding system that may be failing by now and the 20-year-old home often ends up with a maintenance list that surprises the unprepared home buyer.
3. Fixer Houses Have Bad Bones
Buyers often go into fixer houses knowing that they need renovations. Common expectations include the need for a new roof, gutters, furnace, kitchen, bathrooms, flooring, paint and appliances; these are often fairly obvious.
Problems arise on fixer homes when home buyers discover issues with the bones of the house that they didn’t anticipate. I think of the bones as the core systems of the house: foundation, frame, roofline, floorplan, drainage and access. If, for example, the home inspection finds that a house has structural problems, expensive damage from wood destroying organisms and drainage problems, this can add a great deal of cost, uncertainty and complexity to a fixer project. It may even push the house out of a price that was agreed to prior to the inspection. These problems can be more difficult to find on your own and often require a professional home inspection.
Left shows signs of possible drainage problems – see tide line. The right shows a moderate to large foundation crack from an undermined foundation.
It’s important to know what to look for when you’re house hunting to avoid one of these possible situations. Be prepared! A prepared home buyer is a happy home buyer.