What is a pre-offer inspection and how can you use it strategically?
Here's the breakdown:
A pre-offer inspection is when you hire a home inspector to complete an inspection of the house you want to purchase BEFORE submitting an offer. I know, sounds crazy, right? This is actually one of the most common ways to give yourself a competitive edge as a purchaser when bidding on a home. We've seen buyers -both our own clients and ones who wrote offers on our listings- win the contract with a pre offer inspection, even if they aren't the highest bidder.
"Okay, Jillian, I can see the benefits to buyers... but what makes them so attractive to sellers?"
The reason this is beneficial is because it eliminates the Home Inspection contingency that most buyers submit with their offer. This contingency can be seen as the 'riskiest' in the eyes of the seller, mainly because a purchaser can void as long as they submit a copy of the report to the other parties. After this, the buyers are released from the contract, no strings attached. If a void occurs, the seller will then have to relist their home again after losing momentum in the marketing of their property. Cue a total freakout from the seller!!
Now comes the "cost" of the pre-offer inspection.
This will depend on which inspector you hire and what type of pre-offer inspection you request. The length of time the seller allows you to be in the home for this inspection is also a determining factor. A standard inspection can run about 2 hours long and it is the most expensive option, with something like a standard townhome running around $700. This inspection covers as much of the home as possible and comes along with a written report and photos. The second option is commonly referred to as a "Walk and Talk". During this time, the inspector focuses on the largest ticket items in the home -the roof, foundation, utilities, and overall condition of the home- and can be completed in between 30 minutes to an hour. Some buyers feel most comfortable with the Walk and Talk as it is the cheapest option given that they are not guaranteed to win the bid on the home, even with the pre-offer inspection.
At the end of the day, strategies like these are wholly determined by purchasing goals and how badly a buyer wants to "win" the home. So, if you think a pre-offer inspection sounds like a good idea for you, talk to your agent about it. Don't have an agent yet? You can always come to the Jillian Keck Hogan Group. ;)
'Til next time,
Jillian
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