How to Read (and React to!) a Home Inspection Report
Buying a place to live can be an exhausting process. Still, 75 percent of Americans say it’s a priority, and who can blame them? Shopping for your dream home (even if you don't have plans to purchase one) is undeniably exciting. If you do move ahead and decide to make an offer, there's one step you really should prepare for: receiving the inspection report, which can take the wind out of your sails in an instant. It’s basically a giant list of everything that’s wrong with your (potential) home. And while not every issue is a big deal, some are significant enough to have you rethinking your offer, or at least renegotiating with the seller. We talked to a few experts to help you figure it all out.
First things first: Check out the summary (or “primary recommendations”) section of your report to see if there are any health or safety issues with the home. Signs of mold would be noted here. “There are mold spores all around us every day, but if you suspect the mold in the home is harmful, get that checked out,” says real estate agent Todd Andrew. (A mold remediation specialist can be hired to help you better understand if there’s a cause for concern.) “Some electrical issues can be a fire hazard and deserve attention," he goes on. “And you don’t want your roof leaking—water is second only to fire as a threat to a wood-framed structure.” If you're good on all counts, read the rest of the report in search of the following red flags.
Inspection Issues That Will Cost You
Beyond health issues, look for expensive fixes. “The big-ticket items are structural, electrical, and mechanical issues,” says Rob Nelson, a real estate broker. “An HVAC, furnace, major appliance, or water heater that isn't functioning properly is a red flag that is worth raising to a seller.” He seconds the warning about older roofs, not only because of water-damage concerns but also because replacing them can be expensive. Foundation cracks are another costly fix and hint at structural damage.
A few issues that can range in cost to repair: Termites are fairly common in older homes, but the extent of their damage can vary. “If the presence of termites is detected—either past damage or active infestation—it’s up to the seller to fix this issue before the sale can proceed,” says Tim Manni, home expert at NerdWallet. Make sure to ask your inspector (or a termite expert) about the extent of the structural damage before going back to the seller. Mold is another one to investigate. “Finding mold is never a good thing, but know that it can always be removed,” Rob says, though the cost can be great. One home he helped a friend purchase turned out to have “some major ventilation issues in the attic,” with “massive amounts of mold” uncovered by the inspector. “After consulting an expert, we learned that the issue was so extensive that it required a complete roof replacement to ensure that the mold wouldn't grow back.” While certainly an extreme example, with mold there is often more to it than meets the eye—and therefore worth getting a second opinion if you see it noted in the report.
“Remember, inspectors can’t see through walls or ceilings,” says Tim, “They can only inspect what they have access to.” If you’re still interested in buying a home that’s been flagged for the presence of mold, termites, or even asbestos, he says, “it’s a good idea to bring in specialists to investigate just how rampant these problems are within the home, and how much it might cost to fix them.” And yes, you'll want to do that before moving ahead with the purchase of the home; depending on how much remediation is required, you might need to go back and negotiate price and repair with the seller.
Less Obvious Red Flags in Inspection Reports
Old homes can be wonderful, but they can result in a range of problems that show up on the inspection report in a more roundabout way. “Many homes with original pipes and plumbing systems have leaky spaces where pipes have rusted or the house has settled and loosened the pipes,” says Leslie Wyman, owner of Epcon Lane, an Ohio-based pest control company. This can cause unevenness and cracking, which can lead to termite issues. Older structures are also prone to mold and mildew (again, if your inspector finds mold, you'll want to ask if it’s weakened the building's structure). “It's also worth being aware of areas where soil against the house isn't draining properly,” Leslie says, “as water damage to your foundation can be extremely devastating.”
Many mid-century homes are even more at-risk of these issues, simply because they still have their original plumbing and electrical systems intact (as opposed to much older homes that have likely been renovated over the years). Leslie recommends having an inspector examine the wiring in the home if not brand-new, especially if signs of a rodent problem are noted on the report. “Pests can cause serious harm to electrical systems, exposing wires which can lead to electrical fires, shocks, and short circuits,” she says.
Finally, if your prospective home comes with a chimney, Tim suggests getting that inspected, too. “Professionals snake a camera up through your chimney to look for damage or debris which can block the flue and potential cause a fire,” he says. “There are also services which ‘sweep’ your property, scanning underground for buried oil tanks. This may sound obscure, but it’s a common problem in older homes.” You're going to find out eventually—better to be in the loop before you close.
An inspection report can be disheartening, especially if the repairs will be costly, but the good news is that you may be able to negotiate these costs with the seller. “Work with your Realtor to negotiate with the seller to cover part of all of the repair costs,” Leslie advises, “as well as the cost of professional pest control services if infestations are current.”