Home Purchase Inspections
With the average residential home price in San Diego being well over half $1 million dollars, my advice to potential home buyers is don’t cheap out when it comes to getting pre-purchase inspections of your potential new home.
I mean we all know about termite inspections. But perhaps equally important, if not more important, is the physical inspection of the home by a licensed California contractor. Yes, there are many home inspectors who are also licensed contractors and in my opinion these are the best people to hire to do the inspection for you.
Almost all purchase contracts in California are written in such a way that the inspections of the property are a contingency for the sale of the property. Another words, if there are problems and those problems cannot be resolved between you and the seller prior to purchase you have the right to cancel the purchase and receive all your deposit money back.
So, what I’m saying here, is to think about these home inspections like cheap insurance. Personally, I rather have the deal fall apart in escrow then to discover six months or a year after the purchase that there was a serious material flaw in the property that I’m now living in.
Home Purchase Inspections
I understand that if the inspection report turns up some costly problem with the property it may not be a situation where the seller is willing to repair that situation or it may just be that you don’t want the seller to repair the situation, you just want out of the contract. In either of two those two scenarios, if your real estate representative worded the contract correctly you will be able to cancel the escrow and receive 100% of your deposits back. What you won’t get back, will be the minor cost of the physical inspection itself.
So what I’m saying here is that the $350 or $500 that it costs for this inspection is well worth it, to know that you had a professional look at your property as a contingency of your purchase. This could definitely, and has in a lot of cases, prevented people from buying properties that have major material defects or at the very least costly repairs required to ensure you’ve made a good investment
Now, usually the physical inspector is a general type inspector and if they say that they see signs that you may have to bring in another inspector, such as foundation issues. Under most contracts this is provided for and you have the option of either canceling the escrow or having another inspector come out to verify the integrity of the property.
Or, when you get a recommendation to get a further inspection you could also ask the seller to pay for that additional inspection because it was something that you were not contemplating doing until you had the report from your physical inspector. If the seller refuses to pay for this additional inspection, if you really want the property you could pay for it or you can say that you want to cancel the escrow.
Again, the above are just my general thoughts about the home inspection process. You should always talk to your own real estate representative prior to, or during the drawing of the contract to make sure that all these provisions are properly covered in the contract before it’s presented to the seller.
In conclusion, from my three decades of residential real estate sales, I would say that unless you are a licensed building inspector or building contractor, don’t undertake the physical inspection process yourself, but get a well regarded professional inspection company to do this very important evaluation of your potential purchase. CYA – these are just my opinions and since I’m not involved in any direct transaction at the moment and I don’t hold a law degree please just consider this, my random thoughts and opinions about physical home inspections. Always consult with your own real estate representative, your financial advisor and your CPA, PRIOR TO getting involved in any real estate acquisition.
For information about San Diego California, visit the city’s official website.
