Estate agents now recommending home inspections

Home inspections have become an unstoppable trend in the South African real estate industry. More and more estate agents are recognising the need to increase transparency in the home buying process by way of supporting home inspections.  Estate agency MD, Berry Everitt, in fact, recently called for home inspections to be made compulsory in order to protect vulnerable first time home buyers.

This shift is also being driven by buyers who are increasingly aware of their consumer rights, and who are demanding more transparency as regards :

  • The pricing of the house
  • The condition of the house
  • The legality of the structures and installations

More home sellers are also asking for home inspections – prior to listing.  Sellers are realising that a home inspection report fosters confidence with prospective buyers who are impressed by such openness.  A pre-listing home inspection can, in fact, facilitate and speed up the sales process.

John Graham CEO of HouseCheck says both home inspection companies and estate agents need to find ways to embrace this new market reality and to find ways to work together without compromising the professionalism of either. 

In South Africa the fledgling home inspection industry has been viewed with suspicion by many estate agents who sometimes saw home inspectors as “negative deal-killers” who were more interested in being hyper-critical, rather than adopting a pragmatic and realistic approach to home inspection.  Some home inspection outfits have not helped their cause by trumpeting property “horror stories” and implying that estate agents are out to collude with sellers in order to deceive buyers.

HouseCheck works actively to foster professional and mutually respectful relationships with estate agents, while at the same time striving to present buyers with factual and detailed reports on the condition of a house. 

HouseCheck has taken the following steps to achieve this goal:

  •  HouseCheck reports state upfront that “no house is perfect” and that all structures deteriorate and require on-going maintenance.
  • HouseCheck reports distinguish clearly between “maintenance items” on the one hand, and “structural, safety and functional defects” on the other.  Detailed cost estimate breakdowns for each category are provided by HouseCheck.   This information enables buyers and sellers to take a realistic view on both immediate repairs required and to also get a handle on on-going maintenance issues.
  • HouseCheck routinely makes its reports available to the estate agent involved in the deal – at the same time that the client receives the report.   HouseCheck is able to do this because it retains ownership of the report at all times.  HouseCheck takes the view that its reports are both factual and objective and therefore should be used in the interests of encouraging informed decision-making and transparency between seller, buyer and estate agent.
  • If serious problems are discovered during the inspection, HouseCheck inspectors will often telephone the estate agent and advise the agent of the issues so that the agent can become involved in informed price counseling of seller and buyer.
  • In order to retain objectivity, HouseCheck does not undertake repairs or receive kick-backs from contractors, estate agents or anyone else. 
  • HouseCheck reports, which are available within one working day of the inspection, are all thoroughly checked by in-house quality control experts to insure that HouseCheck reports achieve a uniform high standard of accuracy and comprehensiveness.

Here’s how estate agents can use home inspections to enhance their professionalism and effectiveness in the marketplace:

  • Embrace the transparency created by the home inspection process.  Understand that a professional home inspection report, at the time of offer to purchase, greatly reduces the possibility of post-sale come backs and complaints from buyers.
  • Develop a relationship with a professional home inspector in your area who you can recommend with confidence.   This relationship should be based on a professional foundation of mutual respect for the vital role that each party plays in the sales process.
  • Talk to sellers about the wisdom of a pre-listing home inspection.  This enables the seller and agent to price the house realistically after taking into account the actual condition of the house – after the seller has completed any or all of the repairs as detailed in the inspection report.
  • Show the seller how this transparency created by a home inspection can create confidence with buyers and differentiate the inspected property. 
  • Point out to sellers and fellow agents that, contrary to popular opinion, that home inspection slows down or kills sales, the opposite is true.  Because potential buyer objections are credibly addressed upfront, a seller’s home inspection report can actually facilitate and speed up the sales process. This is because the buyer does not need to make a heavily discounted offer in order to cover the guesstimated cost of repairs.
  • Point out to the seller that buyers usually exaggerate the cost of fixing observed defects and a good home inspection report therefore reduces the buyer’s power to demand unrealistic price discounts.  A home inspection report introduces objectivity and reality into the sales negotiation.
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