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Why Price Shopping for a Home Inspection Isn’t a Smart Move for Sellers

At HomeLight, our vision is a world where every real estate transaction is simple, certain, and satisfying. Therefore, we promote strict editorial integrity in each of our posts.

You often hear that homebuyers should hire a “deal killer,” or the most thorough home inspector in town, to check out the house they plan to purchase before closing. But the truth is that the same advice applies to sellers in the event that they opt to do a pre-listing inspection on their home.

“There’s a lot of cheap inspectors out there, and you’re going to get what you pay for,” says Chad Hett, CEO of The Elite Group, the largest home inspection company in California that employs more than 70 Certified Master Inspectors,

With fewer years of experience and not a lot of business, “they’re very desperate, so they charge very low prices. But, their inspections are poor and then they’ll miss a lot of stuff.”

Still tempted to price shop for an affordable home inspection? Let’s cover all the ground for why that plan could backfire and the criteria you should use to select a home inspector instead.

Inspector taking notes on clipboard in front of home.
Source: (Sean Locke/ shutterstock)

What’s a home inspection anyway, and how much does it cost?

A home inspection is a noninvasive visual evaluation of a property’s following components: foundation, roofing, plumbing, HVAC, electrical system, and exterior grounds. The home inspector investigates visual defects with any of these systems and determines whether they are a safety or health concern.

The national average cost for a typical home inspection is $326 but can range from nearly $200 on the low end and $500 on the high end.

This covers only the basic inspection—others like termites or radon gas inspections are not included and require an extra $100 and a couple of hours with a separate inspector specialized in these areas. To figure out what’s best for your house, talk to your real estate agent who can recommend what inspections to conduct based on your location and climate.

Costs may also vary between older versus newer homes and the square footage of the house. Every house has a different cost criteria breakdown for a home inspection, so make sure you find a reliable home inspector who can spell out the invoice for you.

What’s the whole point of a pre-listing inspection?

Let’s say you’ve got what you think is a solid offer on your house when the buyer presents you a list of demands they want you to fix before proceeding.

Now you have to ask yourself, should you scramble to fix up your house or risk the buyers voiding the sale when you were so close to the finish line?

This type of closing conundrum happens all the time: In January 2018, 76% of homes sold had buyer contingencies penciled in, and the home inspection was the most common one. Over the course of 2017, home inspections delayed 15% of sale contracts and blew up 29% of terminated contracts.

The home inspection contingency means that buyers can make home repair requests or ask for a credit within the designated home inspection time frame and walk away without consequence if you can’t come to an agreement.

Doesn’t sound so good for home sellers, huh? Then, is there no way to avoid these delays and terminations?

As a preemptive solution, some sellers decide to conduct pre-listing inspections, which happen before they list their house. This helps to curb big surprises with home repairs that could come up after the buyer makes an offer and before closing.

Now, buyers typically cover the home inspections, but a seller’s pre-listing inspection is the responsibility of, you guessed it, the seller.

With all the costs that come with selling your house, a bargain home inspection sounds tempting. However, hiring a cheaper home inspector who has less experience isn’t the smartest decision if you want a fast closing for one key reason: if the buyer’s inspection turns up big issues that the seller’s inspector missed, then you’ve negated the purpose of getting an inspection in the first place.

Homeowner caulking cracks in ground to prepare for a home inspection.
Source: (roungroat/ rawpixel)

Do sellers have to get a pre-listing inspection?

Like how you don’t have to buy additional “care warranty” for your new cellphone, you also don’t have to get a pre-listing inspection. It’s not a requirement in contracts or real estate transaction clauses that a seller must conduct an inspection. But, if you have the time and money, it might be worth the cash in the long run.

Pre-inspections give you an idea of what to expect in your buyer’s future home inspection and help you answer questions like, “should I fix up that patch of exterior wood rot before listing?” or “do I need to get my plumber over here to fix a leaky pipe?” These types of insights make the home selling process easier and faster to get through, especially if your house is on the older side.

Burton and June Kennedy, a top real estate duo in Greensboro, North Carolina, agree that while having a pre-listing inspection is one way to expedite the selling process, clients should only decide to conduct one if they’re prepared to make necessary repairs.

“If we think there’s going to be a number of repairs or we think it’s more affordable for the seller to recognize what repairs need to be done, they can contact the people that they want to work with and have it fixed before the buyers come in,” says Kennedy.

Let’s say major issues crop up during the inspection that you’d like a little time to price out and remedy. Perhaps roof damage calls for several quotes or you could DIY some exterior paint touch-ups with a quick run to the hardware store. You can now get these items repaired on your schedule and in time to still price at the top of your house’s range if possible.

Overall, a pre-listing inspection helps you avoid that list of surprise repairs or requests from the buyer at the closing table, which can slow down the sale.

For a definitive answer on whether to get a pre-listing inspection, talk to your real estate agent, who can help you weigh the pros and cons of dropping up to $400 for an inspection.

But keep in mind, whatever you find needs to be disclosed in the seller’s disclosure agreement. Again, this decision depends on your timeframe and budget. Be prepared to spend time and money to make the repairs.

A Home seller researching home inspectors on a tablet.
Source: (Karolina-Kaboompics/ rawpixel)

Why sellers (and buyers) should find a home inspector based on experience, not price

When you see dollar signs at each step of the home selling process, it’s hard not to switch on survival mode and try to save every penny possible. Home inspections, however, only make up a fraction of the total cost of selling a home. And, as one of the last key components of the home sale, home inspections are not where you should look for a discount.

Nick Gromicko, founder of the International Association of Certified Home Inspectors (InterNACHI), one of the largest online resources that provide certification for inspectors and education to consumers, expands on this point.

“[People] are shopping for mortgages, interest rates and checking price, getting into that price mode,” says Gromicko. “And then when it comes to the home inspection, they’re still in that ‘how much is my closing cost going to be,’ ‘how much is the mortgage going to cost me.’”

He advises that this isn’t time to try to save a couple bucks. “Trying to save $10 when you’re inspecting potentially a million dollar property makes no sense whatsoever,” he concludes.

A price cut signals a deficit somewhere else with the home inspector. Their cheaper option might be an indicator of less experience and expertise, meaning that a less expensive home inspection can lead to thousands more in missed repairs that they couldn’t catch.

Hett explains that the most important quality to look for in an inspector is their experience in the field.

He advises homeowners to do their due diligence—research the home inspection that their real estate agent recommended, especially if they’re in a state that doesn’t require home inspectors to have a license. Then, check their reviews, testimonials, and make sure they have errors and omissions insurance so that they’re covered if any mishaps happen on your property.

In general, both Gromicko and Hett agree that part of the selection process should include certification awarded by an approved association like InterNACHI or American Society of Home Inspectors (ASHI), which evaluates inspectors’ years of experience and the number of inspections they’ve carried out.

‘Affordable’ home inspections aren’t a thing: Inspections cost what they cost

After all the money you spent on home staging and other costs to get the house ready for the market, you might want to cut corners on the home inspection. But experts in the field and top real estate agents agree that home inspections are not the time and place for a 20% off coupon. If you’re going to hire a pre-listing home inspection, do it the correct way with an experienced inspector.

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