Recently the question came up whether you should waive the home inspection to make your offer more competitive:
“I was just told that the real estate market in my area is so hot that I should consider waiving the home inspection. I can see how this would make my offer more attractive to a seller. But it seems like it could put me at enormous risk. Should I wave the inspection?”
The “advantage”
When the sellers receives multiple offers, they usually picks based on two criteria:
- Which offer nets them the most money?
- Which offer is most likely to result in a successful sale?
If they receive two offers for the same money, but one waives the inspection contingent, the latter is more attractive. Because no inspection means less risk of the deal falling through due to unpleasant surprises during the home inspection. Therefore, an offer that waives the home inspection contingency could beat out other offers. And buyers might perceive this as an advantage.
The risks
However, the reality is quite different. Just like the scenario of buying a house as-is, you take huge risks if you do not have a home inspection. Sure, you might really like the house, have been searching for months, or were outbid multiple times. However, waiving the home inspection means you will not know about potential issues with the house such as:
- damaged or worn-out roof coverings
- broken trusses in the attic
- rusted leaking water pipes
- cracked foundations
- structural issues
- failing HVAC systems
Are you sure you want to find out about such issues after you moved in?
If you waive the home inspection, you will not know about upcoming large expenses such as:
- $9,000 for a new HVAC system
- $8,000 for a new roof
- $6,000 to excavate and replace the main sewer line
- $8,000 to re-pipe the house
Can you afford to pay for such expensive repairs out of your own pocket? And these are low estimates based on a modestly sized home.
And worse, there could be hidden safety issues such as:
- electrical fire hazards
- gas leaks
- lack of ventilation for gas appliances
Do you want to live in a house that could kill you and your family?
Conclusion
If you have answered ‘no’ to any of these three questions, then you definitely should not waive the home inspection. The risk is just too high.
Furthermore, consider this: A less-than-honest seller might pick an offer without inspection contingency because he has something to hide. Your ‘advantage’ of waiving the home inspection just turned into a major disadvantage.
In conclusion, the moral of the story is: Always get a home inspection.