|June 29, 2017
Hatteras Island Real Estate:In
a sales transaction between the time that a contract is signed and the
closing, the buyer will almost always order a home inspection as a part
of their due diligence evaluations of the property they are purchasing.
This is an important milestone because the home inspection report
usually introduces a second round of negotiations into the sale. This
year, we have seen an increase in the number of contracts that have
failed to close because of home inspection discoveries. What could be
causing this trend, and what can sellers do to minimize potentially
negative impacts from a home inspection?
The Value Of Pre-Inspections
By TOM HRANICKA
giving this issue considerable thought, I believe there are three basic
factors that are responsible for the troublesome reports – the aging of
our residential inventory, construction deficiencies, and owner
reluctance to make repairs.
at the current inventory of homes for sale, over half are anywhere from
20 to 50 or more years old. Given the age of these homes and the
coastal climate that characterizes a barrier island located 30 miles
from the North Carolina mainland, a progressive deterioration of homes
is to be expected.
codes have evolved over time. Houses today are built to different
standards than they were 20 or more years ago. In addition, some homes
have construction deficiencies relative to the Hatteras Island
environment. (The absence or inadequacy of flashing around windows and
doors which allows moisture intrusion is an example.) These
shortcomings are not just limited to older homes, either. Inspectors
are finding issues with cottages built during the last building boom.
- Even when repairs or upgrades are known or recommended, some sellers choose to defer needed maintenance.
identify ways that sellers can improve the odds for a positive outcome
from a home inspection, I contacted members of a professional real
estate organization to which I belong, and I researched published
articles on the subject. I was somewhat surprised that the
recommendation was almost universally the same regardless of the source
– sellers should consider getting a pre-inspection
of their home before they list their properties for sale. This will
uncover necessary repairs that might scare buyers and cause them to
back out of the sale or to renegotiate the terms of the contract. Once
repair issues are identified through a pre-inspection, sellers are
advised to make necessary significant repairs.
Here are some of the benefits of a pre-inspection.
There are also some reasons that sellers may decide not to order a pre-inspection.
- Identifies major or unanticipated problems that could potentially derail a future sale.
sellers to adjust their asking prices if they are not willing to make
certain repairs or to negotiate a higher price if no major problems are
sellers time to compare prices and repair costs from a variety of
contractors as well as time to fix problems without the stress of time
constraints associated with contracts.
- Reassures potential buyers that there are no major surprises ahead of them.
- Demonstrates good faith on the part of a seller which may encourage a buyer to more readily make an offer.
inspections are an expense to the seller. Home inspection costs can
begin around $400 for smaller cottages, and the cost increases based on
the size of the house.
a home inspection report is received by a real estate agent, it becomes
a material fact which must be disclosed to all future buyers and their
agents. This can be turned into an advantage if the report is annotated
with repairs that the seller has already made.
all is said and done, there is no right or wrong answer about whether
or not a seller should order a pre-inspection. It all boils down to
whether a seller wants to understand and address issues affecting the
condition of their home before marketing it, or whether they prefer to
take a “wait and see” attitude relative to buyer concerns that develop
after a contract is finalized.
real estate agents can recommend a variety of licensed home inspectors
to sellers who would like to order a pre-inspection. This is an option
that is well-worth considering when planning to list your Hatteras
Island cottage for sale.
Hranicka is a broker with Outer Beaches Realty. Questions, comments, or
suggestions for future articles may be sent to Hranicka at P.O. Box
280, Avon, NC 27915 or emailed to [email protected]. Copyright © 2017 Tom & Louise Hranicka. All rights reserved.)