Florida Home Inspections
What to Inspect and Why?
Did you ever buy a car without driving it first? I bet not. In fact, I bet that even before you drove it, you sat it in, felt the steering wheel, ran your hand over the leather seats and maybe even adjusted the mirror.
You probably even researched what kind of mileage you could get on a gallon of gas. All good things to know…
So now you are talking about buying a home...a huge purchase with a more expensive price tag that you may be paying on for the next 30 years.
So read on to learn about what you should be inspecting on the property you are considering spending $ hundreds $ of thousands of dollars on...or more.
This information is too important not to read...it covers resale homes to brand new construction, seawalls, septic tanks, wells, termites, pools, crawl spaces, costs of inspections, vacant land and more…
Whose home inspection opinion is this?
This article is written by a collaboration of Exclusive Buyers Agents at Buyers Broker of Florida that only represent home buyers and never sellers.
These buyer experts have been to thousands of home inspections and typically understand the house problems that are barely noticeable to homebuyers and mostly minimized by sellers agents.
These Buyers Brokers also know what problems you might be able to renegotiate...
This blog takes you on a deep dive into Florida Home Inspections and at the end of this article you will find answers to unusual inspection questions with true stories of home inspection nightmares...it should be an interesting read.
Do you really need an inspection on your Home?
Yes, for sure you need a home inspection...you should know everything there is to know about the house that you want to buy. The good, the bad and the ugly...
Don’t listen to your friend that bought their home and skipped the home inspection and ignore any agent that says “sure you can inspect...if you want to…” or worse...recommends that you “waive” your home inspection”.
Spending $ hundreds of thousands $ of dollars for a home and then skipping home inspections to save a house inspection fee or make the seller like your offer, is not the road to happy home ownership.
What is a Home Inspection?
It is a visual examination of the house from top to bottom, by a licensed home inspector. They will examine the HVAC system, the roof, plumbing, attic (if accessible), electrical system, structure,walls, ceilings, floors, windows, doors, and lot drainage.
The home inspector will also examine and evaluate all the appliances. They will look for any existing problems or potential future problems.
The home inspector will also point out the positive aspects of the home and provide maintenance tips to keep your home in top condition.
A written report will be provided with all the details and pictures that show any problems. The report may be more or less 40 pages long.
4 Main benefits of doing a home inspection:
- It's your hard earned money...it's smart to know what you are buying.
- You may get the seller to fix some deficiencies.
- You might be able to re-negotiate a purchase price discount.
- You may find problems that you cannot accept and no longer want to buy that home.
Who should you hire to inspect your house?
A Florida licensed Home Inspector. Sure, you can do your own inspections or hire a relative... but that would not be in your best interest.
If there are real issues, the seller and the seller's agent will not give much credibility if this inspection was not an “arms length” report by a Florida licensed professional home inspector.
Home inspectors are just like any service business...some are good and some are not worth using.
We only recommend the best in the business. We have tried using dozens of different inspectors but routinely only use a few excellent ones, that we know are top notch.
BTW: We do not receive any kickback for referring any home inspector...
The best guide we use for trying a new inspector that we have not used before, is to look at a copy of their inspection report...it must be detailed for the problems, easy to understand with large pictures so that you can see what the problem is.
In addition, we want to know the inspector's credentials, experience and see a copy of his license and liability insurance.
There are professional licensed inspectors that also have advanced accreditations like ASHI, NACHI, and FABI which adhere to higher standards in home inspections.
This does not mean that anyone who does not have extra accreditation is not a good inspector. Not at all. Some inspectors will go through the advanced training and then choose not to pay the yearly fee to use the designation.
Cost of Home Inspections
While costs vary, the best inspectors are never the cheapest, so forget about seeking a bargain basement discount. A good home inspectors cost is usually about the same as what other good home inspectors charge.
Top home inspectors are in demand and they stay busy so they do not need to discount.
Inspections will range from about $400 on up. Most generally, the cost is less than $1000 but can run higher depending upon the size of the home and amenities that need to be scrutinized.
A typical home inspection can take 2-3 hours. However we have had high end properties that cost a few thousand $ dollars and took 2 days to inspect.
- The home buyer is always welcome to attend the home inspection...
Since we are professional buyer representatives, we always go on home inspections so that we can see what the condition is, what the problem looks like and learn what the cost to cure may be.
- We attend inspections regardless of whether or not the buyer is attending.
We believe that an agent that does not attend the home inspection cannot adequately negotiate the cost of the problem with the seller because they are not informed.
- Whew...seriously...How can anyone understand the extent of a problem if they have not seen it ??
What kind of Florida home inspections do you need?
It depends...what are you buying?
- Single Family Home?
- Apartment building?
- Vacant land?
How old is it? Is it block or frame? Does it have septic? Any buildings? Pool? Waterfront?
Let's start with a Comprehensive Home Inspection, typically used for a single family home. It is a basic home inspection that most buyers will start with when buying a single family home.
A comprehensive home inspection is a basic inspection for roof, electrical, plumbing, A/C, pool, structure and all the appliances. Plus a WDO inspection: WDO= Wood Destroying Organism which includes termites, rotten wood, powder post beetles and the like.
If the inspector finds anything of big concern and you are still considering buying the property, then you will probably want to hire an additional specialist to inspect the problem further.
You may need a structural engineer, an A/C contractor, an electrician, a plumber, pool contractor, septic company, elevator repairman, or a technical specialist.
The Single Family Residence Inspection
In addition to inspecting the interior, a comprehensive home inspection on a single family home also includes the exterior of the home and the lot that it sits on.
The inspector will check the slope of the home to see if the water drainage leads away from the home.
They look at the house foundation to check for structural cracks, erosion,or any sign of subterranean termites.
If there is a screened room or pool, the inspector checks the stability of the frame and condition of the screening.
They check the driveway or pavers for any settling or cracks.
Inspections for a Condominium
Since a condo purchase only includes the portion that you will actually own, home inspections are limited to what is inside your four walls. That means the physical inspections are limited to the interior walls and ceilings, electrical, plumbing, HVAC and appliances.
Sometimes the condo inspector will need to go up on the building roof to check the AC or go down into the condominium basement to check on any storage unit. In addition there may be a hot water heater, or maybe even an air handler located in the condo basement that needs to be assessed.
During your inspection period you might also want to check out the HOA documents, Condo By-Laws, and current rules and regulations.
It is also good to see the Condominium financials to review the financial health of the community. If a condo is struggling financially, the owners will most likely be assessed additional monies needed...something that most buyers like to avoid.
Most often a buyer's concern is usually the part about allowing pets.
They want to know what kind, what weight and how many animals they are allowed to have.
People with pets want to make sure that they can move in with them. Here are the pet friendly condos.
Sometimes there are pet restrictions, but the agent will say “do not worry, because they do not enforce the rules”. Don’t listen to that!
Condo rules will always take precedence over what the agent may claim.
Besides, the condo board members will eventually change and they may start enforcing the rules they previously ignored...or a neighbor will complain about your pet so they must start enforcing the rules that are in place.
Many buyers do not understand the legal language in condo documents so they may wish to hire an attorney to decipher the rules. Or maybe at least read the parts that may be a concern.
We are not attorneys so cannot give any legal advice but will gladly provide the information to you or point you in the right direction.
Inspecting a Townhouse or Villa…
Let's start by clarifying what the differences are:
Condominium is like an apartment building. It can be only 2 stories or as many as 30 stories or more. Everything outside your unit belongs to the association and not you...which is why you pay a maintenance fee, so that the condo association has the funds to fix any problems.
Townhouse is usually a 2 or 3 story attached structure with/or without a courtyard. It may be a “fee simple” purchase just like a single family home, where you are responsible for your roof and the exterior grounds. Or it may be like a condo, where you are only responsible for the interior of your unit and the association is responsible for fixing the rest.
Villa is like a townhouse or condo but only a one story attached structure. More than likely there is a small courtyard that belongs to you.
All three of these will have a maintenance fee which will vary depending upon the amenities, how much of the property you actually own or how fancy the community is. The common area is maintained by the association that you pay your maintenance fee to.
Many home buyers are just so excited about having a personal pool that some believe that just because the pool looks inviting, everything is probably A-ok.
Not always so. Some pool problems are hard to find and need a thorough review by someone that understands all the pool functions.
Here are some of the things that the pool inspector looks for:
- Open Wiring
- Broken conduit
- Defective GFCI outlets
- Loose or broken handrails
- Pool cracks
- Pool Leaks
- Inoperable equipment
- Pool/Spa vessel and coping
- Pool/Spa Lights
- Pool Pump
- Pool filters, piping, timers, heaters
- Pool finish
- Deck surface
- Screen Enclosure
On some foreclosure or short sale properties the pools are not maintained. So the pool may be totally green or covered with boards for security reasons.
If you cannot see the pool enough to do a thorough inspection, this may be a good time to just assume that not everything is functioning properly. Plan to budget spending money to bring the pool up to good working condition.
Should you have the waste water/sewer pipes be scoped?
If the home is older than 1975, that may be a good inspection to have, because it will most likely have cast iron pipes.
These pipes have a life expectancy of only 50-75 years. After that time more than likely the pipes will be PVC which do not rust.
Sewer pipe scope is done with a fiberoptic camera that shows a visual condition of the inside of the pipes. There could be cracks, major rust, tree roots or settling of the pipe which could create a back-up because it has lost its pitch for flow.
This is an important inspection because if there is any problem it will be an expensive fix. Not to forget that this plumbing repair will mean the floors will most likely have to be cut out in order to lay new piping.
Septic Tank Evaluation consists of the following:
- Determine the size of the drainfield
- Drain the tank to examine any cracks, tree roots or any deterioration.
- Check the sIze of the tank, to determine that it is adequate for the number of bedrooms and the square footage of the house.
- Check the drainfield for any clogs that might plug up the lines and not allow water to flow through.
If there is a problem with a drainfield for a septic tank the remedy is one of the more expensive fixes. If you are buying a home with a septic, you should always do a septic evaluation.
One time I was picking up yard debris in my lakefront backyard when I stepped too close to the shoreline and my foot went into a hole. The hole just looked like grass, so it was not visible.
I did not realize how dilapidated my “seawall” was. It was made of wood.
Without a solid seawall the yard will eventually get eaten away by the water.
Where do you find seawalls? Anywhere there is a body of water. It can be a lake, canal, creek, river, bay or ocean.
Why do you need one? A seawall protects the land from being eroded from the waves coming from the water or boats. It is also the most critical structure when it comes to protecting your waterfront property from boating waves or storms.
Seawalls are most often made of concrete, but can also be made of wood, steel, rip-rap, composite, aluminum, vinyl, fiberglass and even sand bags.
Many homeowners do not routinely maintain the seawalls, so if you buy a home and it has a seawall problem, the cost to fix may run $20K-$100K or more. That is a high cost and for sure worth doing an inspection for.
Vacant Land or Lot
Even if you are buying a vacant lot, we always recommend an inspection.
Not all lots are buildable, and those that need too much prepping might not be cost effective to purchase.
Every lot needs some kind of inspection checking...depending on what you plan to use the lot for. Sometimes the buildable part is smaller than advertised and may require a price adjustment.
Think a survey is not important? Think again...
One of my closest friends owned a survey company. Some of the stories she told were almost scary...here are two of them:
1. Buyer buys a vacant lot on a huge lake. Pays cash and decides he does not need an survey, because he has sorta figured out where the lot starts and stops.
After closing he is not as sure, so he hires (my friends) survey company to stake the lot...and learns that no part of the lot is on dry land. All of the property is actually in the lake...
2. Buyer buys a new construction townhouse. The buyer's friend advises that since he is paying cash, a survey is optional, not mandatory. Buyer decides to skip the survey and the closing takes place.
After closing: the buyer learns that the unit they closed on was actually 2 blocks away from the unit that they were under contract to buy. The townhouse they closed on is the wrong one!
Inspecting Brand New Construction Homes
Yes, even Brand New Homes have problems. The quality of a newly constructed home is only as good as the supervision of the project manager.
Many buyers assume that if the house is new it must be perfect...not so.
Most builders in Florida are busy and always looking for construction help so the quality of workmanship may not always be the best.
Sometimes they are so desperate for workers that they hire anyone that calls on the “workers wanted” sign at the entrance to the community.
On brand new homes, I have seen exhaust vents not connected, missing hurricane straps in the attic, broken roof tiles, unfinished kitchens, no plumbing hooked up, and even hot water flushing the toilet.
Just last year, one of the biggest US developers of new construction homes built such a sloppy $500K house that our buyer pulled out and refused to close.
Yes, they got all their money back...without a fight.
Interestingly, the property was re-sold to another home buyer within a week...for a higher price.
Among the problems... the builder did not fill the concrete blocks as required, and used 2x2 posts for the structure instead of the 4x4 posts the blueprints called for.
The framed wall in the master was so crooked that the builder had to put another fake wall over it so that it looked straight. I am not kidding...
The “deal killer” was the upgrades that the buyer contracted for, which the builder decided not to include anymore.
Can you imagine?
Builder gives you a spec sheet with all the upgrades you included in the build and other perks. Weeks before closing, the builder claimed that it had a “typo” so revised the “spec sheet”.
The “revised” list no longer included an extra window on the front of the house, they eliminated the pavers in the back, replaced the fancy glass front door with a plain wood one...plus changed the bathroom tile to small tiles...and more. All together, the builder changed or eliminated 12 upgrade features.
What's that you say? They can’t do that?
Sure they are not supposed to do that…but some do.
Reality is that builders do whatever they feel like...which is another reason why having an experienced EXCLUSIVE Buyers Agent on your side is priceless.
If we know about any new construction flaws, we do address it as it needs to be corrected. A brand new home should not have any “problems”.
There are 2 kinds of home inspections for new construction:
- A phase inspection where the inspector will inspect in phases as the home is being built.
- A comprehensive inspection, which is done when the home is completed.
Lately, I am seeing more builder contracts that limit the builders responsibility after closing. Once you “close” they do not want to be responsible for anything that your inspection missed...or the builder omitted.
That is why it is most important that you have an inspection on your brand new home, before you close on it.
Some builders are creating obstacles so that the buyer skips the inspections.
Recently, one of the largest builders in the US decided that the buyers Home Inspector must have $1,000,000 liability insurance, $1,000,000 workmans comp and $1,000,000 auto insurance. (yes, even auto insurance).
We called 10 inspection companies, none of which carried that much insurance.
We complained to the builders top management who then recommended a home inspection company. They were lousy...seriously lousy. They refused to check the roof and said they do not report on cosmetic issues (keep in mind that there should be no cosmetic flaws on a new build).
It was obvious that the builder manager was funneling business to this company, because even this company ( the one he recommended) did not have the required amount of needed insurance the builder was requesting...we know that because we checked.
What is an Inspection Contingency?
A home inspection contingency is a clause in the contract that allows a buyer to inspect the home within a certain period of time.
It gives the buyer the opportunity to inspect the property for anything they want to inspect.
How Much Time is Allowed for Your Inspection Period?
Usually about 7-15 days from the mutual acceptance of the contract. Sellers agents usually try to cut the inspection time as short as possible.
The inspector will usually be at a typical basic inspection for about 2-3 hours, but is not limited as to the time allotted to check everything.
If you need more days to inspect, have your buyer agent request an extension. It is not smart to omit some inspections just because the time frame for your inspections is cut too short.
Is a Home Buyer limited in what they can inspect?
No. As long as they are within their inspection period, they can inspect anything they want. They can also hire more than one inspector or have multiple inspections on the same problem.
The only thing that an inspector cannot do it open up walls or destroy anything...it they do, they are responsible for fixing it.
Of course there are some sellers' agents who think that you can only do one inspection or that you are limited in time for each inspection. Not true.
Can you inspect ALL homes?
Although most contracts do allow for home inspections as buyer contingencies, sometimes there are exceptions. (read below).
The most commonly used contract in Florida is the Florida “FAR/BAR” contract and the Florida FAR/BAR “AS-IS” contract.
Both allow for a potential home buyer to inspect the property and even cancel the contract if they are not happy with the inspection report...if the cancellation is requested during the inspection time frame.
EXCEPTIONS: WHEN INSPECTIONS ARE NOT CONTINGENCIES.
- Auction properties and certain bank owned properties might not offer home inspections as a contingency in the contract. Some may want you to do your own inspections before making an offer on the property. Not a good idea as it can be a big waste of your money if your bid is not enough to buy the property.
- Most new construction properties also do not offer home inspections as contract contingencies. New home builders will fix the deficiencies that are found on your inspection report, but that does not mean it will be fixed before closing.
Removing the inspection contingency.
At the end of the inspection period the home buyer needs to either:
- Cancel the contract.
- Renegotiate the contract and remove the contingency.
- Remove the contingency and accept the property in its present condition.
Do I need a good reason to cancel the contract?
No, No and No... During the home inspection period you may cancel for any reason.
It does not have to be for a good reason and the seller or the seller's agent (or your buyers agent) does not need to agree...in fact you do not even need to give a reason for cancelling the contract.
If I cancel the contract over inspections, do I get my deposit/escrow money back?
Yes, as long as you canceled within your inspection period. Always put that in writing so that you have a record of it. We do ask for a confirmation of receipt from the listing office.
Keep in mind that if the seller delays your inspections for any reason, or you need more inspection time, you will need an inspection extension addendum to the contract, signed by the seller.
The addendum should note the new dates/deadline for inspections.
Otherwise if you do cancel just verbally, someone may claim that your cancellation was not timely and may try to place a demand on your escrow monies.
...and sometimes, the seller is miffed simply because you cancelled the contract, so on a rare occasion (for no valid reason) the seller may put a “demand” on your escrow deposit, in the hopes that you will simply give up your escrow deposit to them.
For example: we just had a buyer pull out of a short sale contract because the seller did intentional damage to the house,(cut the water pipes, clogged up the toilets).
Buyer decided not to close and the seller put a demand on the buyer's deposit.
What to do if you want the seller to fix some deficiency?
We put your request in writing as a requirement for what you need in order to move forward to closing. Specifically, how we want it fixed...for example:
“Seller to remove xxx by a licensed professional and replace xxx with xxx” .
“All work to be performed by a licensed professional. ( licensed roofer, licensed A/C contractor, licensed electrician etc.) Seller to provide the buyer with a copy of a paid receipt and any warranty upon completion.”
What is the criteria for a home inspection to pass or fail?
There is no pass/fail as this is not a test. It is a report for the condition of the property by a qualified home inspector. Some parts will be favorable and some may be deficient.
What is a 4- point inspection?
A 4-point inspection is a condensed version of a home inspection. It is an inspection report for only the following:
- HVAC (Heating,vents, air conditioning)
What is a “walk thru” inspection?
- This is an inspection that is done just before the closing. It can be a day or two before or on the morning of the closing. Buyer can also do more than one walk-thru inspection.
- It is to check that the property is in the same condition as when the home was purchased and that no new problems have occurred.
- It is also to confirm that the seller has indeed repaired any deficiencies that they agreed to fix.
Just this morning I learned that on a property that our client is getting ready to close, the seller has cut through the plumbing pipes in order to remove the water softener.
What a shocker! What was worse is that the seller's agent did not think that was a problem...
OMG what were they thinking? Not only did water spew 15 feet when turned on, there is no way that any other plumbing or water source in the house can be checked. The Florida Far-Bar contract does not allow the removal of anything attached!
The craziest thing is that many agents do not bother doing a walk-thru at all or will do one only if the buyer is present. Even then, they expect the buyer to do their own walk thru...even though most buyers don’t know what to do.
I have heard stories about homes being flooded, trees falling thru the roof, racoons moving in, all the appliances stolen and even closing on the wrong home…you better believe it! It does happen.
A final walk-thru is an extremely important inspection
We always do a walk-thru with or without the buyer. This is the last opportunity to check the house before the closing. We don’t expect the buyer to know that they can open the doors, check the cabinets, turn on the A/C and look in the fridge...which is why we do it for them.
One time, I found that the seller had taken all the drawers out of the refrigerator and also the vanity drawers in the bathroom. They used the drawers to move their junk just like others would use a cardboard box.
We made them bring it all back...sellers cannot just take what they want to make their life easier...
The appliances should be working, the a/c should cool, the ceilings should be free of new water stains, the light fixtures should be intact, the garage door opener should function, etc,etc,etc. Nothing that is attached should be removed or replaced.
All the junk and personal items of the seller should be gone from the house...and not just to the curb. Sometimes sellers will place furniture on the street or toxic paint and hazardous chemicals that the city may not pick up.
The seller needs to dispose of that properly as that should not be the new buyer's problem to deal with.
If problems are found in the final walkthrough, there is still a window of opportunity to either get it fixed, or get a credit for the problem. Once the transaction closes, and the buyer's money is disbursed, the buyer has no recourse against the seller. (unless of course the seller committed fraud).
Another perfect reason why a buyer is best served using an Exclusive Buyers Agent Instead of a seller’s agent or a transaction broker who offers no loyalty. Our duty is always to protect you, the home buyer by always putting your interests first.
What is a Sellers Disclosure?
In the State of Florida (and probably most other states) The seller is required to disclose any deficiencies, defects or issues that are not readily visible to the buyer.
While the seller must provide a disclosure, in Florida, it does not need to be in writing...which is the problem. A “He said” “She said” is never good enough.
What information should be disclosed?
Everything about the house: Leaks, mold, pest infestations, electric or plumbing issues, problems with appliances, past insurance claims, previous flooding problems,current liens, HOA violations etc.
Actually the seller needs to disclose all “material facts” that may be germain to the buyer either wanting or walking away from the home purchase.
Some things may be material to one buyer and not important to another buyer. That is why a seller's disclosure is important.
Of course full disclosure does not always happen...
Many times sellers try to hide the problem and sellers' agents avoid a written seller's disclosure by claiming that the “seller never lived there”... or that the sellers “just bought the house a few months ago, so they know nothing...blah, blah, blah.
A bogus excuse. I own several rental properties that I have never lived in yet I know all the deficiencies because I pay the bills. So does every property owner...trust me...they do know!
How can you make sure that you get a written seller's disclosure?
- You can make the seller's disclosure a contingency in the contract.
- Or you can request a seller's disclosure during your inspection period.
If the seller's disclosure is incomplete, or outdated, a good buyer's agent will send it back to complete the omissions and request an updated revision.
True story: One time we had a client under contract for a large and unique property. During the house tour, the seller's agent mentioned that all the carpet on the first floor has been replaced due to the pool overflowing.
Now, I am not an engineer, but I did notice that the outdoor pool was built lower than the first floor of the house. I also know that water does not flow uphill…
I requested a written seller's disclosure and got pushback from the seller's agent. He claimed that the seller had not lived there for the last 5 years so he did not have any current information, so there was no need to disclose.
I insisted and finally got the seller's handwritten disclosure...all 6 pages of it. What a gem! This seller disclosed everything and more than was required.
I learned that... the second floor flooded due to a water pipe break and did so much damage to the first floor that not only were the floors damaged, but the double pane windows were all permanently foggy.
Needless to say, that was an unusual but pleasant surprise that the seller was so forthright...and yes, that is rare.
Another True Story...just this week I had a client going to contract on a home that had multiple offers. The seller's disclosure showed no house defects and claimed that the home was renovated in the past 5 years.
The seller's agent quickly sent us an email that requested us NOT to send the inspection report to her.
The only thing that makes sense is that if the agent does not have a copy of the inspection report, she can claim that she “knows nothing about the property”...despite the fact that the house had termites, along with electrical and plumbing problems.
This is not the first time that a seller's agent requested that we do NOT send them the inspection report...that way they do not have to disclose all the house problems to the next buyer. Dishonesty for sure…
Recently a home buyer decided not to buy the house after inspections revealed issues that were stated incorrectly on the seller's disclosure.
For one, the house did have aluminum wiring, but the seller's disclosure said it did not.
The property went back on the market at the same price with the same sellers' disclosure that now is blatantly inaccurate about the condition of the property.
Per the Realtor Code of Ethics, both the seller and the agent are now required to disclose the newly discovered deficiencies to the next buyer.
What does not need to be disclosed?
In Florida, Murder or Suicide does not need to be disclosed.
I strongly disagree with that because I do think it is a material fact that should be disclosed. I have had many clients who would be turned off about buying the property knowing that there was a murder in the house.
What is the difference between a Home Inspection and a Home Appraisal?
A home inspection is just that; an inspection of the quality and functions of the home. This is done by a home inspector.
A home appraisal is a request from your lender to provide a market value of your property. This is done by an accredited appraiser, that you do not get to pick.
Also, appraising is not a science, it is strictly one person's opinion based on comparing the sold properties.
When should you waive doing a Home Inspection?
Never...never ever. Sometimes when there are multiple offers on a property, the homebuyers panic and think they must have that house, so they do desperate things…
For Example: Buyers will remove the protections they had in the contract.
- Removing the inspection contingency: That means the buyer will not do a home inspection, so that their offer looks better to the seller.
In other words the buyer is throwing caution to the wind and is willing to take the house “as it is” with all the problems that the buyer does not even know exist (because they chose not to inspect the property).
- Removing the appraisal contingency: Buyer is willing to take a gamble that the property will appraise at the sales price.
If it does not appraise, the buyer will pay the difference out of their own pocket. What if the appraisal is $50K short? $100K short? Now what?
Do you still have enough money to buy the house? The lender will only let you borrow on the appraised value or the purchase price...whichever is less.
OK, so what if…
- Before you close you learn that there is a crawl space under the home that is full of black mold?
- You discover that the 4th bathroom is an illegal add-on?
- The septic tank is not adequate for the number of bathrooms?
What is your recourse now? You have none...because you gave away all your power to negotiate.
Sure, you can cancel the contract and walk away...but you will also forfeit your deposit money, because you breached the contract if you walk away after your home inspection contingency expires.
What can a buyer renegotiate after an unsatisfactory home inspection?
It depends...on the problem, the age of the home, the purchase price, the seller, and even what the seller’s agent thinks.
We have negotiated seller credits of nothing ($ zero $) to almost $100,000 in repairs and seller credits, after finding unsatisfactory home inspections.
- Sellers do not agree that there is a real problem.
- Seller may think you are already getting a bargain price.
- Seller may not have the money to fix the problem.
- Seller may just be hard nosed and say “no way”.
In that case, you have a decision to make. Is the fix something that you are willing to take care of on your own? Or is the problem such a turn off that you no longer want the house?
If you walk away from the property, are you confident that you can find something better for less? A good buyer's agent can help you sort out your options...ask us...we always give straight answers.
We have found that the majority of time, the seller is willing to make some kind of financial concession to the buyer in order to sell the property and move on. Likewise, the buyer usually likes the property enough to pay “out of pocket” for some repairs.
How urgent are the problems? Some deficiencies need to be corrected immediately, and some may not be so urgent. Most of the time it is better for the buyer to take a credit or a price reduction instead of asking for the seller to fix.
Why is that?...because sellers like to cut corners and may search for the cheapest repair person to do a job that they might not be qualified for.
Can you re-inspect what the seller agreed to fix?
Absolutely! You can either re-inspect it yourself or bring back your licensed home inspector to review the fix. There is usually a small charge for the inspector.
If the repair is visible and appears fixed with a professional repair receipt, then no, a re-inspection might not be necessary.
If however the fix is the roof, a/c, electrical, or something that is more complicated, or a more expensive repair, or cannot be visibly evaluated, you should have the inspector do a re-inspection to confirm that the repair was done in a professional manner.
3 Home Inspection “shoddy fixes” stories:
After 30+ years of helping home buyers get the best buy on property, nothing surprises me anymore.
Yes, home sellers do lie and seller agents typically claim not to know…for sure most sellers' agents will never point out any house problems...that is not their job.
Problem #1: Roof Leak
Seller had a roof leak and agreed to fix it. Buyer brought the inspector back to climb inside the attic and check the fix.
Instead of actually fixing it, the seller just re-directed the water from the roof leak into a long 15 foot metal channel to the other side of the roof where the water dumped through a hole in the soffit to the outside.
It was amazing all the trouble the seller went through just to make it appear that the roof was not leaking any more.
Solution: We had the seller credit the buyer adequate money so that the buyer could have the problem fixed correctly.
Problem # 2: Another Roof Leak.
We had one seller fix a roof leak for the home buyer and provided us with a receipt from a licensed roofer. A re-inspection by the buyers inspector revealed that they only plugged up the hole, but did not replace the rotted sheathing and fascia.
Solution: We made them re-do the repair by removing and replacing the rotten parts...which is how it should have been fixed in the first place.
The seller paid for another repair that included replacing all the rotten wood. Buyer was satisfied with the 2nd re-inspection.
Problem #3: Septic Tank
Buyers did not want to buy a home with a septic tank. Seller claimed that the house was on city sewer, not septic, so the buyer agreed to buy the property.
During home inspections, the Buyers Agent (thank you, Erika) becomes suspicious and again asks the seller if they have a septic tank. Seller insists that he has a city sewer...
Long story short, the property did not have city sewer, only septic so the buyer proceeded to do a septic tank evaluation. The septic was so destroyed with a tree growing in the middle of the tank that the septic company refused to even pump the tank.
In addition, the septic was not the legal size needed for the bathroom addition that the owner had added on.
The seller had lived in the house for 2 years and yet claimed he did not know that his property was on septic...did he really never receive a water bill?
Are any deficiencies “grandfathered in”?
That is always a sore subject...
Most agents think that if the seller bought the property with problems or code violations that it is “grandfathered in” and not a problem anymore.
Not so. While some laws changed in Florida in 2019-2020 regarding permits and non-permitted additions, it can still be a big problem for a buyer who is unaware of what is acceptable or not.
Besides the house, what other things should I inspect or check out?
One thing I would recommend checking into would be the cost of insurance. Insurance companies are getting more picky and many are pulling out of Florida.
Things that were previously “no big deal” are now on the forbidden list. Insurance companies do not like roofs that have less than a 15 year life expectancy, polybutylene plumbing, aluminum wiring, old electrical boxes like Federal Pacific or Zinsco and even a hot water heater that is more than 12 years old.
It does not necessarily mean that you cannot get insurance...that depends upon the carrier. It does however mean that you will pay a higher premium.
In addition, you will also need to evaluate the cost of flood insurance (if required) which in some cases may be actually higher than the cost of homeowners insurance.
Getting a thorough home inspection with a good home inspector is priceless and something that you should never underestimate. The more you know about the condition of your property, the less chance you have of overpaying for the property or paying high expenses for the fixes.
Need answers? Call Buyers Broker of Florida for a friendly chat about your housing needs. 727-202-9130.