The Value of a Home Inspection
How to measure the value of a home inspection
Value relates to meeting the real needs of the customer (buyer, agent and seller); price is just about getting a cheap deal. So, what are the needs of the people involved in a property transaction – in other words the buyer, the agent and the seller?
The main needs of all parties in a property transaction are the same:
- The ability to make an informed decision – no surprises or comebacks after the sale
- The power for all parties to negotiate a fair deal, which makes financial sense
HouseCheck value proposition:
- Trained and experienced inspectors who can uncover the serious defects and avoid nit-picking over minor blemishes to the property.
- A report which which:
- Identifies all serious defects
- Describes the cause of the issue
- Provides a sensible remedy – refurbishment, repair or replacement
- Quantifies the cost of this remedial action
- The information provided in the HouseCheck report greatly empowers the negotiation process
- The buyer knows what is wrong and how much it will cost to fix. This information empowers the potential buyer.
- The seller knows, after seeing the HouseCheck report, what is wrong with the property and also realises that the seller will now have to disclose these defects to other potential buyers if the buyer who commissioned the inspection report decides to “walk away”. If this happens, then the seller essentially has four choices:
- Either fix the defects before the sale goes through, or
- Agree to a fair price which takes into account not only the “market value” of the property, but also the cost of fixing serious defects, or
- Allow the buyer who commissioned the HouseCheck report to “walk away” and then face the legal obligation to disclose the defects discovered by HouseCheck to future potential buyers, or
- Commit fraud by trying to sell the defective property to someone else without disclosing the defects identified by HouseCheck.
- The informed agent (who has access to the HouseCheck findings) is able to play the role of a “honest broker”. This is the real value of the estate agent: to be a property professional and guide the negotiations between the buyer and the seller in the light of the information in the HouseCheck report, together with prevailing market values
The agent knows that if the seller refuses to negotiate and allows the buyer who commissioned the HouseCheck report to “walk away” then both the seller and the agent will be committing fraud if they do not disclose the defects revealed in the HouseCheck report to future potential buyers.