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Exploding the idea of Pre-Offer inspections!

 

Pre-offer inspections are not for the faint of heart!

In my market, with limited inventory and abundant buyers, “pre-offer” inspections, or “walk-through” inspections have become very common.  I know inspectors that claim to do nothing else.  The idea of a pre-offer inspection is for the buyer to get a sense of whether it is worth jumping into the fray of multiple offers.

At a fairly recent inspection, there were something like 18 offers made on the property and during the 2 hours I was at the home there were 8 other inspectors there.  That many people traipsing, poking, and prodding through a home can be very stressful on a seller and their home. 

I have heard of some sellers refusing to allow walk-through inspections—smart sellers in my opinion.

I am told that if the buyer can get a good sense that there is nothing “major” wrong with the home, then making an offer by waiving inspection might put their ultimate offer in a more favorable light to the seller---thus getting a leg up on the competition.

I do not like these walk-through inspections.  I do them however.

I am not worried at all about missing something major.  It is the accumulation of little things that would have come out in a full inspection that worries me.  Most of the time when I do walk-through inspections, where the client prevails, they typically have me back to do the full inspection to get that all important “honey-do” list.  Sometimes these lists are not short.  I have to think that sometimes the buyer begins to wonder if they should have considered a walk-through inspection.

The list of things that are NOT CHECKED on a walk-through inspection is almost endless not to mention the amount of time spent on most components is reduced.  In a way it is almost like going through the house with blinders on.  Of course I discuss everything, even little things, during the walk-through inspection, but the inspection is by no means a “full inspection.” 

Typically HVAC equipment won’t be operated, toilets won’t be flushed, water pressure won’t be taken, the ages of appliances won’t get noted (except for maybe the furnace and water heater), difficult to crawl attics won’t be accessed, difficult to traverse crawl-spaces won’t be accessed as thoroughly, lights and receptacles won’t be tested, GFCI’s won’t be tested, water temperature won't be taken, automatic garage door openers won’t be tested, windows and doors won’t be tested, and a host of other things.  Some inspectors won’t even walk on the roof.  It is not because these things are not important, because they are, it is because NONE OF THESE THINGS SHOULD BE DEAL BREAKERS.

Another thing to worry about is, “What if they don’t call me back for the full inspection?”  It is their choice--they could save some bucks.  (The vast majority do however.)  The other day was a perfect example of something that was not noted at the walk-through and came up as a bit of a surprise on the full inspection.  All three toilets were of the “exploding kind.”  Now suppose the buyer had decided to not have me back for the full inspection and only found out about the toilets as porcelain shrapnel started spraying?

While this is perhaps an egregious example of what can happen when inspections are waived, it serves as a warning to those undertaking such an approach.

Pre-Offer inspections are not for the faint of heart.

 

Charles Buell, real estate inspections in Seattle

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Seattle Home Inspector

 

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WA State, Home Inspector Advisory Licensing Board

Comment balloon 21 commentsCharles Buell • August 16 2014 11:50AM

Comments

Hi Charlie... I can just imagine being the seller with 8 inspectors roaming around the house! I'm a little naive about the whole pre inspection idea, but it's been a while since I bought any property. Yet after a little investigation online into the 'exploding kind' I had no idea! Wow, glad I don't have one of those!

Posted by Rene Fabre, Marketing in the Digital Age (First American Title) almost 4 years ago

Hi Charles - These are very rare in our market, and it isn't crazy enough yet to see many buyers willing to waive the inspection. From your post, I'm thankful that it's so. And I'll have to chack otu exploding toilets - that seems like a nice feature.

Posted by Dick Greenberg, Northern Colorado Residential Real Estate (New Paradigm Partners LLC) almost 4 years ago

Rene, they make me nervous even if "repaired"

Dick, once you have ridden an exploding toilet you will never go back to a regular toilet

Posted by Charles Buell, Seattle Home Inspector (Charles Buell Inspections Inc.) almost 4 years ago

I can't imagine 8 home inspectors in a house and none is sharing information!

To my knowledge I have never seen the exploding toilet.  I gather when it is flushed there is a forced water flow?

I lived in South America for two years and have to admit to exploding INTO a toilet a few thousand times... but that is a different recall matter.

Posted by Jay Markanich, Home Inspector - servicing all Northern Virginia (Jay Markanich Real Estate Inspections, LLC) almost 4 years ago

Charles we have had our inspector ride along with us on occasion when the market was red hot. It did help out a lot. But it was only one buyer in the house at at a time...not a whole bunch of them.  And if we went ahead with an offer he always went back for a full blown inspection.

Posted by Anna Banana Kruchten CRB, CRS 602-380-4886, Arizona's Top Banana! (Phoenix Property Shoppe) almost 4 years ago

Charles, I had to chuckle when I got to the part of not flushing toilets during such walk-through inspections.  You may be amazed at how many buyers flush the toilets during showings!  

Posted by Silvia Dukes PA, Broker Associate, CRS, CIPS, SRES, Florida Waterfront and Country Club Living (Tropic Shores Realty - Ich spreche Deutsch!) almost 4 years ago

As a Seller's agent, I can't imagine I would advise them to allow this. Of course we don't have the same demand for inventory, but all I could think when reading this was - 8 inspectors times 8 personalities times 8 buyers discovering things that may or may not be important, now all of that has been disclosed to the Seller, ergo the Seller now how to disclose to any prospective Buyers. It could cost THOUSANDS to the Seller before they even get an offer.

Posted by Mimi Foster, Voted Colorado Springs Best Realtor (FALCON PROPERTY SOLUTIONS ) almost 4 years ago

Jay, I know, and they can't really---but they sometimes leave the panel cover off for each other :)

Anna, and have there ever been issues with finding stuff they wish they had found the first time?

Silvia, that is strange---probably the house buying equivalent to kicking tires when buying a car?

Mimi, yes, but remember, most of these inspections do not involve any reports---so the seller might not be learning anything from the inspections.

Posted by Charles Buell, Seattle Home Inspector (Charles Buell Inspections Inc.) almost 4 years ago

This is not something typically done here. I find it interesting that you say a full inspection can produce a long list of items that the walk through would not. I would believe, and you did mention some items, that these are more along the lines of general maintenance or minor repairs. Expected with owning a home. I have found that prioritizing the bigger items is what my clients are looking for in their journey to the closing table. The other stuff is nice to know, but can muddy the waters so to speak. 

Posted by James Quarello, Connecticut Home Inspector (JRV Home Inspection Services, LLC) almost 4 years ago

Jim, I have found it is so difficult to predict what any one buyer finds important enough to "walk" away from.  I agree with you---but some have no clue what it means to maintain a house or the costs to do so.  I think often times a walkthrough inspection gives a buyer a false sense of what they are getting into. 

Posted by Charles Buell, Seattle Home Inspector (Charles Buell Inspections Inc.) almost 4 years ago

It sounds like the inspector is a little uncomfortable with the process, not the buyer  

I hear what you're saying, but by the very nature of the beast, it should be understood that you're not there to find every little thing. One must manage the clients expectation before the inspection. 

Posted by James Quarello, Connecticut Home Inspector (JRV Home Inspection Services, LLC) almost 4 years ago

That makes little sense to me. You have an inspection time after it goes under contract. Use it. Get it done and, if major issues come up, walk away.

I would not advice a seller to let this happen either. I doubt that a truly competent job could be done with that many people inspecting at once.

Does each inspector demand to run the DW on their own?

Posted by Than Maynard, Broker - Licensed to List & Sell - 405-990-8862 (Coldwell Banker Heart of Oklahoma) almost 4 years ago

Jim, exactly---but actually both are uncomfortable about it.  Buyers feel they have no choice when they start throwing money at inspections.  If you are going to throw money for full inspections on 10 houses it can hurt a lot if you never get the house.  Many buyers feel that if they can at least get a sense of whether it is even worth making an offer on, then walkthrough's start to make sense.  I have one client I am working with right now that I have already done 4 walkthroughs for.  If that had been full inspections it would have been over $2400.00.  The walkthroughs on those four is about $800.00.  Still hurts---but not as much.  One can manage expectations as much as we want but that will not always get rid of all of them.

Than, so a house with 18 offers gets 18 full inspections?  Most clients are not that confident that they will prevail.  And yes, on a full inspection most inspectors will run the dishwasher   Gets pretty crazy doesn't it?

Posted by Charles Buell, Seattle Home Inspector (Charles Buell Inspections Inc.) almost 4 years ago

I can't understand how one can perceive liability on this type of inspection. There is no report, no contract (or is there?) and therefore no documentation. 

As for the buyer, simply, one must live in the world that exists at the time. No one can change that. In other words, it is what it is. You can't worry about it. 

Posted by James Quarello, Connecticut Home Inspector (JRV Home Inspection Services, LLC) almost 4 years ago

Trust me Jim---I can worry   And yes there is a contract.  It spells out the limitiations, costs etc. 

Posted by Charles Buell, Seattle Home Inspector (Charles Buell Inspections Inc.) almost 4 years ago

Might want to ditch that contract. You are tying yourself to the house. In that situation, me thinks that is not what one would want to do. It could come back to haunt you. 

Do the other inspectors use contracts for these inspections?

Posted by James Quarello, Connecticut Home Inspector (JRV Home Inspection Services, LLC) almost 4 years ago

Always has to be a contract for anything an inspector does in the State of WA.  In addition, walkthrough's can ONLY be done if there is no offer in place.  Sometimes I get requests for the cheaper walkthrough even when the client has already made an offer.  This is expressly forbidden in our licensing law.

Posted by Charles Buell, Seattle Home Inspector (Charles Buell Inspections Inc.) almost 4 years ago

Now I can understand your angst. Not a favorable situation for the inspector. 

Posted by James Quarello, Connecticut Home Inspector (JRV Home Inspection Services, LLC) almost 4 years ago

Charles-Maybe because our inventory is not as tight here, not experienced a pre-offer inspection yet. Thank goodness.

Posted by Wayne Johnson, San Antonio REALTOR, San Antonio Homes For Sale (Coldwell Banker D'Ann Harper REALTORS®) almost 4 years ago

Jim, nope---not at all---and the client either for that matter.

Wayne, I think it is market dependent---just too few houses on the market here right now.

Posted by Charles Buell, Seattle Home Inspector (Charles Buell Inspections Inc.) almost 4 years ago

Charlie, I am glad that is not the norm here also. I have done very few of them.

Posted by Donald Hester, NCW Home Inspections, LLC (NCW Home Inspections, LLC) almost 4 years ago

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