The Buyer’s and Seller’s Guide to Inspections
Your offer has been accepted and you’re filled with happiness ,but before it’s time to celebrate the purchase, make sure you’ll enjoy that same happiness six months down the road. There’s a lot more to a home inspection than simply searching “home inspectors near me” or booking with an inspector your realtor recommends. This article is meant as an informational guide for making the process of property inspections better for buyers and sellers.
Disclosures provide information on known issues with a property and other historical details.
Delivery and receipt of the seller’s disclosure at the outset of the buyer’s inspection contingency period can greatly assist a buyer’s duty to exercise reasonable care to protect themselves and conduct thorough investigations of the property both personally and with appropriate professionals.
As a seller you can help the buyer know the condition of the property they are purchasing from you to mitigate unknown or undisclosed issues coming back to you after closing.
Issues and repairs in the seller’s disclosure should be brought to the inspector’s attention and discussed at the inspection to investigate the areas of items further as needed.
Read the inspection report from cover to cover.
A real estate inspection is a visual examination and basic operation of the dwelling’s main systems and com
ponents, which provides the client with information about the general condition of the dwelling.
An inspection is designed to discover and identify material defects and to communicate these issues clearly.
A material defect is a condition that significantly affects the value, desirability, habitability or safety of the dwelling.
An inspection report provides written documentation of material defects. The report details what the inspector found so that all involved parties can make informed decisions.
Because the general physical inspection report has important recommendations and useful information, the inspection report should be read from cover to cover and acted upon.
What the inspector inspects.
A general visual inspection focuses on the five major systems: the foundation, the roofing, the plumbing, the electrical and the heating & cooling systems. It also includes exteriors, interiors and the grounds immediately adjacent to the structure. Signs of moisture intrusion are also a major focus.
What the inspector reports.
The inspector focuses on three reportable categories through-out the inspection process. After the inspection, you will receive an inspection report, it is very important to read it in its entirety.
Safety hazards: Things that pose a threat of bodily harm or serious injury if left unhandled, such as: smoke detectors not installed in the required areas, improperly installed electrical wiring that could be a fire hazard, missing carbon monoxide detectors, ect.
Items at the end of their useful lives: Things that have gone past the time they were made to last and are in need of replacement. An old water heater, dishwasher or furnace are some examples.
Items not functioning properly: Broken switched, leaking garbage disposals, leaky faucets and similar repairable items fall under this category.
Invest in your investment for a fraction of the cost of the property itself.
Purchasing real estate is a major financial investment. Selling real estate is a sizable financial transaction. Therefore, the process of buying or selling a home comes with legal obligations.
Real estate inspections provide valuable information and peace of mind. Whether negotiations for repairs or credits are necessary or not, having the information is your return on the modest investment of an inspection. Plan to set aside money for the inspections you want performed.
Marketing your listing.
Sellers who are proactive can take control of their real estate sale by having their own pre-listing inspection done.
Pre-listed Inspections are performed prior to listing to discover the existing condition of the home/property so a seller can:
- Discover issues the seller may not have known about before an offer is accepted
- Focus on What to repair, replace or leave as-is in the sale on the seller’s terms
- Adjust the listing price to reflect the true “as is” condition of the listing
- Find the right buyer with disclosure of the inspection’s finding before accepting and offer
- Minimize further price negotiations and delays in escrow
- Diminishing the risk of a buyer canceling escrow during the inspection contingency period
- Avoid having to go back on the market with an older listing
- The seller is obligated to disclose the previous buyer’s inspection findings to the next buyer
What the inspection doesn’t include.
The general inspector does not look inside walls, under carpets or take equipment apart. In other words, they don’t have x-ray vision.
Some of the items not included in a general visual inspection:
- Cosmetic and aesthetic conditions
- Systems or components of a building which are not readily accessible or observable
- Conditions related to insects, animals, fungus and mold
- Activating or operating any system, component or appliance that is shut down
- Code compliance
- Geological or soil-related examinations
The four specialty inspections each home should have.
Specialty inspections fall outside the scope of the general inspection and are usually ordered during the inspection contingency period by the buyer. Sellers often order these with a pre-listing inspection to help sell their listing faster and with less risk.
Specialty inspectors are trained to focus on a specific aspect of the property and use specialized equipment. These inspections can include an estimated cost for repairs, if needed.
Molds can be found most anywhere – indoors and out. And usually aren’t a problem indoors unless they find a damp environment and start to multiply. That’s why moisture control throughout the home is so important.
Exposure to mold allergens and irritants can exacerbate – or even cause – health concerns such as respiratory problems, sinus issues and skin rashes. Especially in adults and children predisposed to certain health conditions.
Mold testing is done two ways: surface scans and indoor air samples. Collected samples are sent to an accredited lab and afterwards, you’ll receive a detailed report of the findings. If mold is found, the types will be explained and along with remediation options.
The National Fire Protection Association (NFPA) recommends a level 2 chimney inspection anytime there is a sale or transfer of property to make sure a wood-burning chimney is safe.
A level 2 is an in-depth inspection involving a video cameras scope inside the chimney to properly determine the safety and usage of the structure.
Sewer Line Inspections
No one can see the inside of the main sewer line without a video scope inspection. Three reasons it is important to know a line’s condition:
- Costs for repairs or replacements can be thousands to tens of thousands of dollars for bigger issues. The sooner an issue is discovered, the less costly it is to address it before it gets any larger.
- Sewer line issues can result in messy and urgent situations inside the home or property. It is wise to have an inspection done and address any such potential problems right away.
- The homeowner is responsible for the entire length of the sewer line, from the home to where it meets the street.
Radon is an odorless gas that seeps into the home through the foundation. It’s caused by the breakdown of granite in the earth and is present throughout Minnesota in varying levels. Over exposure to radon is the #cause of lung cancer among non-smokers.
Radon testing for real estate transactions is [performed with an electronic monitor that measures levels in the home over a 48 hour period. R
adon measurement testers are required to be licensed in Minnesota.
If the test results are above EPA-recommended guidelines, installing a radon mitigation system is surprisingly cost effective. In addition to the health benefits for you and your family, in the long run it’s an investment that will pay for itself financially when you sell your home because it will be one less thing to deal with.
Schedule inspections early.
Buyer: Once you have an accepted offer you should decide upon the inspections you want and schedule those as soon as possible. Allow several days after the inspection to obtain estimates for possible work if needed. Many companies offer convenient online scheduling.
Seller: Prior to listing a property for sale, inspections allow time to make any chosen repairs or service calls on the seller’s terms, price the listing accordingly, disclose in full along with the disclosure documents, reduce the need for renegotiations and mitigate buyer’s cancelation.
Who should do your inspection?
Anyone can become a real estate inspector. Licensing is not required and does not exist for real estate inspectors in the state of Minnesota. That being said, choose somebody with experience and that you trust. Your real estate agent will often provide you with recommendations for an inspector or inspection company they have had good experience with in the past.
Here is a list of qualifications to look for when choosing inspectors/inspection services
- Membership in a professional trade association for real estate inspectors, such as ASHI, or InterNachi.
- How many 4 or 5 star online reviews does the company or inspector have? What are the most common comments?
- Errors and Omissions Insurance coverage. – General Liability insurance.
- Is a Repair Price Estimate report available? This can be a time saver during the contingency period when pulling together rough cost estimates.
- How many inspections has the company or inspector performed?
- Will the inspector allow the client to be present and discuss any major findings on-site when the inspection is done?
- The report should be computerized and written in narrative style.
- Photographs should be included in the report.
- Will the inspector be available to answer any questions after the inspection report is delivered?
Both buyers and sellers sign many documents outlining their specific obligations, rights and duties. For a smooth real estate transaction, educate yourself as to your role in the disclosure and inspection process.
Failure to disclose is not an option
Minnesota case law states that it is the duty of a seller to disclose relevant facts concerning the property for sale through a disclosure statement. A seller of one to four residential units has a legal obligation to disclose all of the conditions of the property known to them, to prospective buyers. When in doubt, disclose.
Put yourself in the driver’s seat as a seller. Have your own inspections performed. The advantage of having the knowledge of what the buyer will be seeing with their own inspections allows for better control of a sale.
Increase your options and results as a seller
- Decide what to address in the inspection reports on your terms
- Set the listing price based upon the true condition of the property
- Disclose the complete picture to prospective buyers before accepting an offer
- Buyers can submit offers with higher confidence
- Attract the right buyer for your property and its current condition
- Have a smoother transaction
- Reduce negotiating points
- Bypass untimely delays
a buyer wants to know what they are purchasing before investing thousands of dollars. Buyers have a right to negotiate for repairs credits or walk away if they determine the listing isn’t what they thought it was or it doesn’t fit their plans for home ownership.
Being prepared for inspections can help the process. Below is information to gather and steps to takes you will be ready to schedule and attend your inspections.
Please ensure the water, gas, electricity and all operable pilot lights are on to complete inspections. It is the Seller’s responsibility, per the Residential Purchase Agreement.
When you call:
- Have the correct address and year built.
- Schedule the general inspection.
- Schedule any additional inspections you’ve decided upon or were recommended.
- Mention any additional structures, guest unit or converted garage.
- Say if the home is vacant or occupied.
On inspection day:
- Ensure all keys, keypad codes, garage openers ect. are available (home owner)
- Make sure all areas of the property are made accessible (home owner)
- Make sure any animals are safety secured (home owner)
- Prepare any questions you have for the inspectors.