Q: My agent is recommending a lot of expensive inspections. What do I really need and why?
A: Your agent is doing exactly what he or she should be doing. Your agent is protecting your interests and making sure you will make a fully informed decision.
I certainly understand that you are already facing an expensive purchase, and the thought of spending a lot of money on inspections isn’t very attractive. Would you prefer to spend $1,000 on a house you don’t buy, or would you rather find out after closing that your dream house needs thousands of dollars in repairs?
I’ve had buyers back out of deals after an inspection revealed expensive or unsafe conditions. Never once have they complained about the cost of the inspection. Look at it as money well spent to insure that you are making the right decision.
The California Association of Realtors lists 31 different inspections that can be ordered, including general home inspection, pest inspection, chimney, electrical, heating/air conditioning, lead paint, plumbing, square footage, structural, easement/
encroachments, foundation, lot size, boundaries, pool/spa, roof, sewer, septic system, soil stability, survey, tree/arborist, well, water systems, radon gas, formaldehyde, asbestos, methane gas, mold, permits, public records, zoning and government requirements.
While the list is enough to scare anyone, we seldom recommend more than a couple of inspections. Every home should have a general home inspection and the wood destroying pest inspection, which is commonly called the termite inspection. The home inspection costs $300 to $500 depending on the size of the house, and the termite inspection costs $150 to $200.
If it is country property, you should add a well and pump inspection and a septic inspection. In South County, due to a problem years ago at the Olin Flare Company, we also advise having the water tested for bacteria, nitrates and perchlorate. The cost is $600 to $700 for the well/pump inspection, another $600 to $700 for the septic to be cleaned out and inspected. The water tests can run between $400 and $500.
After the initial battery of inspections, we can order others to address an item that causes concern. For example, if the home inspection pointed out something on the roof, we would order a roof inspection to ascertain the seriousness of the issue.
I recently ordered a well and pump inspection for a client who was purchasing a home in San Martin. The inspection revealed that the water pressure began very low and then dropped off. The inspection company estimated that the entire pump and motor might need to be replaced at a cost of almost $6,000. With that discovery, we were able to renegotiate with the seller and the buyer’s inspection money was well spent.
Many lenders require a termite clearance before they will lend on a home. Once the termite inspection is completed, the termite company will itemize their findings as Section 1, Section 2 or requires further inspection. Section 1 items are active infestations or dry rot that should be fixed immediately and are typically paid by the seller. Section 2 items are items that aren’t a current issue, but if left uncorrected could lead to a Section 1 issue. The buyer is typically responsible for Section 2 items. Further inspection items are usually areas in the home where an inspector can’t see (corners of attic, blocked areas of crawl spaces, areas blocked by personal belongings etc.) or places where removal of sheetrock may be necessary and therefore won’t make a definitive statement.
As a buyer you have the right to order as many inspections you feel are necessary. Ask your Realtor which inspections are recommended and then add any inspections that will make you feel comfortable with your decision.
Most contracts allow 17 days to obtain and review inspections. Your Realtor should order the termite and home inspections as soon as the purchase contracts are ratified. If you order the initial inspections quickly, you should have plenty of time to order additional inspections should they be necessary.
Since most homes in Santa Clara County are more than $500,000, you shouldn’t be afraid to spend $1,000 to $2000 to make sure you’re getting a good home.