By Joni Ribera, Let’s Talk Real Estate
Amazing as it may seem, homes inspected prior to going on the market have two very significant advantages: They sell faster than homes not inspected until the buyer has made an offer, and they sell closer to the asking price than homes not inspected until the buyer has made an offer.
When the buyer makes an offer, there is an assumption made by the buyer, reasonable or not, that there is nothing wrong with the home. If there was something wrong with the home that the seller knew about, but did not disclose, shame on them — it is about to cost them money. Most often, though, the items that come up on the inspection by the buyer were unknown to the seller. Surprise, surprise! Surprise is not good in real estate. So how is it that the inspection for the seller makes the buyer pay more for the home and do it in less time?
Let us create an example of a 20-year-old home that has a fair market value of $300,000 just to make the math easy. That value assumes that nothing is wrong with the home. When the buyer has the home inspected, it is with the assumption that anything discovered to be wrong will be corrected by the seller or a price concession will be made.
Now, let’s consider that the buyer’s inspection revealed the need for a new roof, several plumbing leaks and the need for replacement of three exterior doors. When these discoveries are made by the buyer’s inspection, the clock is running and running fast. These items need to be corrected before the sale can be completed. This time crunch puts the seller at a disadvantage when dealing with the contractors.
When time is critical, you have fewer choices and the costs go up. Additionally, the buyer often wants to have input on who does what work. This situation is always tense and expensive. It can be avoided!
Let us now assume that the inspection result occurs, but it is for the seller as the home goes onto the market. The seller is now in control. Armed with a clear picture of what is wrong, the seller can choose to shop calmly for the best value in repair contractors and make the repairs, knowing ahead of time that they will have to offer a credit at closing or adjust the sales price to reflect the diminished value. My advice at this time with so much competition is that the seller should make the repairs in advance of putting the home on the market.
No matter the choices made, the seller, on the seller’s time frame, makes them. This actually makes for a neater, simpler buying decision for the buyer. The buyer knows better what condition the home is in and knows what issues to base the initial offer on. The buyer will still in most cases get the home inspected, but this is a breeze. It is rare that any additional items of significance arise. The pre-listing inspection puts deal killing at the lowest risk. Most often, it makes for an awesome deal-closing tool.
Federal Way real estate agent Joni Ribera: (253) 632-5779 or jribera@windermere.com. Also visit www.JoniRibera.com.
