Waiving a home inspection is not advised by home inspectors and real estate agents as it means you will be unaware of existing issues or soon to be major issues; some of which are could be very costly.
Waiving a home inspection contingency and not getting a home inspection after you’ve made an offer on a home, favors a Seller more than a Buyer. If you don’t get a home inspection on what may be the single largest investment of your lifetime, you may be taking a bigger risk than you realize. If you skip your right to an inspection as a Michigan home buyer, you remove your protection and become more likely to encounter unforeseen and unexpected issues, some of which can be very costly!
Should I waive a home inspection?
There are quite a few flaws and defects in a home that often cannot be seen with the naked eye. Home inspections take hours to thoroughly inspect, but your home showing was probably brief. For example, when was the last time (if ever) the home’s sewer was ever inspected? It often has been decades, prior to video camera technology. Other unseen issues are items like HVAC units, incorrectly wired stoves, bad wiring, unsafe structural issues, animals nesting in the attic; just to name a few.
Waiving the inspection contingency does not prevent you from conducting a home inspection for your own peace of mind; but you won’t be able to negotiate with the seller based on the results of any “personal” inspection you order.
What is an inspection contingency?
When a home inspection contingency is included in an offer contract, you can change or end the offer contract without incurring any penalties if any issues are discovered by the inspector. A home inspection is when the buyer hires a licensed home inspector to create a report on the condition of a home.
By including a home inspection contingency in your contract, you can negotiate the costs of any repairs that may be needed. The contingency will give you a chance to withdraw your offer without losing your earnest money deposit. If your inspection finds no serious issues, you have the peace of mind to move forward with purchasing your new home!
Waiving a home inspection contingency
The reason people get a home inspection is that it it provides a home buyer with an added layer of protection. In the distorted pandemic markets, buyers experienced just how unattractive making contingencies on sellers was; with sellers wanting home inspections waived. The reason sellers would want a home inspection waived is so they don’t have to take care of costs for large repairs discovered or fear of losing out on attractive offers.
An inspection contingency is highly recommended, and at the very least, inspecting on the contingency that the seller is not responsible for any repairs you find, while still allowing you to back out.
According to the December 2021 Realtors Confidence Index Survey, 19% of buyers waived the inspection contract contingency, which was down from a peak of 27% in July 2021. Buyers felt incredible pressure to try to make their offers stand out among the feverish crowds of buyers all vying for the limited inventory that was available. The good news? Buyers have regained more bargaining power with the increase in inventory and according to Zillows 2022 Consumer Housing Trends Report, only 14% of home buyers have waived a home inspection this year. The sellers no longer hold all the cards.
A wide range of remorseful homeowners had issues ranging from serious plumbing problems, high levels of arsenic found in their drinking water, high levels of radon in the basement, and serious roofing repairs.
Recent reports say that as many as 42% of home buyers buying during peak pricing and bidding wars that waived home inspections now have remorse. For a homeowner, a home inspection is a crucial part of the process, educating them about their property and providing a buyer with a realistic expectation in the form of a report letting them know whether or not the roof or HVAC is fine today, if it will be fine for five years, and when it will need to be replaced.
A home inspection gives a buyer a roof to foundation report that reviews and evaluated the condition of the homes major systems, safety, exterior and interior structure. It may seem attractive as a buyer losing out on many offers to appeal to a seller by waiving the home inspection contingency but not only will home inspection professionals advise against this, many real estate agents do as well.
Bottom line: Unless your financial resources are large enough to cover the sudden inconvenient and costly issues, or you know you’re getting a fixer-upper and planning on repairs, waiving a home inspection is just too risky.
If you’ve already skipped the inspection and closed on your new home in Michigan, Top Floor Home Inspections can do a post-sale inspection for added peace of mind. Call : (586) 345-5299