On home inspections and sales tactics

The business of selling real estate has evolved through the years, in step with the changing demands of society and influenced by advances in technology. The actual process of listing and marketing a house is quicker and easier for sellers, although it can be argued that the process of buying might not be considered quick or easy in this market.

The act of making an offer on a property has changed with the practice of delaying offers, with the intent to create multiple offers and to secure a firm offer without conditions. This deliberate effort by the seller and listing agent has several elements. These include an artificially low list price, and the ever more common use of pre-listing home inspections, aimed at securing firm offers without a home inspection clause.

Home inspections can be valuable to buyers, as they allow a third party of the buyer’s choice to check over the home, ensuring there are no substantial issues.

As well, a home inspection condition allows potential buyers to walk through the home with the inspector to learn about the house, its mechanical features, and good upkeep techniques. Agents should join in during the inspection, to learn more about homes. In an area like the Beach, this in-the-field training serves agents well. It also provides a record of the house at the time of sale – good for both buyers and sellers.

About a decade ago, when the market really started heating up, the concept of buyers performing a pre-offer home (and termite!) inspection shifted into the buying and offer process. The idea was that a firm unconditional offer was more attractive than a competing conditional offer for a higher price.

Then the practice of deliberately low-balling the listing price to attract more offers started. Many buyers became disillusioned when they added up the wasted money and time they’d spent on these pre-offer home inspections, only to find that it really came down to the price.

In the last three years it has become more common for listing agents or sellers to conduct a pre-listing home inspection, and make this available to buyers. Used frequently in the first-time buyer market, the aim is to entice buyers to submit an unconditional firm offer, based on the fact that a home inspection has already been conducted. This is supposed to save the buyer a $350 to $500 home inspection if, ultimately, their offer is not accepted.

But why should buyers trust the accuracy of a home inspection completed by a home inspector they know nothing about, and whose services were paid for by the listing agent or seller?

Other questions could be raised too. Was the home inspection completed before or after the staging (if any), including repairs and painting of ceilings and basement walls and floors? Has the inspector identified damage by powderpost beetles, carpenter ants, or termites? Did the home inspector diligently check for knob and tube wiring even if the listing agent or seller indicated that the whole house had been properly rewired?

Closely read the fine print in the inspection report, the pre-printed clauses in the offer, and the Schedule B. It’ll be tough to find fault with someone should you discover problems later on. There are good home inspectors and bad ones, much like in any other profession, including real estate.

The best solution if you’re using the pre-list home inspection is to ask questions and read the whole inspection report, not just the summary, together with your agent. You’ll quickly find out if your agent is competent regarding home inspections. Look up the inspector and the company and try to find out their experience and credentials, and whether they are experienced with homes in the area. Call the home inspector yourself. A reputable home inspector should be happy to speak to you. Ask how the wiring, plumbing, drains, roof, and heating/cooling system were checked. Ask if the listing agent or seller were present during the inspection.

You could ask too about their availability to come back to the home, because you may be able to insert a 24-hour inspection clause based on using the same inspector. The seller and listing agent should be secure having that same inspector back.

Ask who paid for the inspection, and whether or not the seller actually read and signed off on the accuracy of the report. A simple clause can be submitted into the offer specifying this. If the home was recently renovated, ask about permits and who completed the work. Call local pest control companies in the area and see if any work (specifically for termites) was completed on the house or within the immediate area.

Finally, don’t be pushed into a firm offer. If you’re at all unsure, insert a home inspection clause and let the chips fall where they may. In most cases, it’ll be about the money in the end.

Have a safe and wonderful summer! Take care.


Thomas Neal is a respected Beach real estate agent – tneal@trebnet.com – 416-690-5100

Was this article informative? Become a Beach Metro Community News Supporter today! For 50 years, we have worked hard to be the eyes and ears in your community, inform you of upcoming events, and let you know what and who is making a difference. We cover the big stories as well as the little things that often matter the most. CLICK HERE to support your Beach Metro Community News!

Click here for our commenting guidelines.

Leave a Reply