The Common Three Inspection Reports

The most common reports that we recommend are the home inspection, pest inspection, and roof inspection. 

General Home Inspection

The home inspection is provided by a “generalist”. Often a retired licensed general contractor, the inspector looks at the systems and structure of the house to provide a general report on their condition, needed maintenance, and life expectancy. The report being general means that the inspector typically won’t be providing specific commentary where the opinion of a specialist is more appropriate, such as commenting on how big of a deal (or not) some foundation cracks may be. They instead will recommend further inspection by the appropriate specialists.

Pest Inspection

The pest inspection, also formally referred to as a wood destroying pests and organisms inspection is looking for just that: wood destroying pests and organisms as well as the conditions that might cause them. These reports are broken down into items classified as sections 1 and 2, as well as note unobservable areas or areas where further inspection are necessary.

Section 1 items of the report covers evidence of active infestation, infection, or other conditions that have resulted from infestation or infection. The pests and organisms that are most commonly found in our area are: termites, wood-boring beetles, dry rot, and wood fungus.

Section 2 covers conditions likely to lead to infestation or infection. Typical items found in this section are leaks or evidence of leaks that may lead to dry rot or fungus. Another common item is earth-to-wood contact, which can lead to termite infestation.

The pest report may contain other items referred to as informational, further inspection, or unknown. These items are important to review as they may discuss notable areas of the substructure or attic that were not accessible at the time of inspection.

Roof Inspection

The last of the three most common reports we recommend sellers provide for their buyers is a roof inspection. This inspection is often a free add-on to a home inspection. It covers the roof covering, and notes needed maintenance and life expectancy.

Why Do Sellers Pay For and Provide These Reports

We strongly recommend providing these reports primarily for two reasons: risk management and ease of the transaction.

Risk Management

In our line of work, we hear all the horror stories about buyers suing the seller of their home because of something those buyers discovered after their purchase. In California in particular, this is all too common. Providing these inspection reports is one way to mitigate the risk. The seller is inviting an independent licensed third party into their home to provide a detailed report on the condition of the property. This helps protect the seller from failing to disclose something about the condition of the home that either they didn’t know or that they didn’t think was a big deal.

Ease of Transaction

When a seller hires a home inspector and provides a report in advance of reviewing offers, it often means that they are trying to be as open and forthcoming as possible in providing all the information they possibly can on the property in order to attract the right buyers and the cleanest offers (i.e., offers without a home inspection contingency). 

By letting the buyer know up front that the roof will need to be replaced in 2 years, for example, the seller knows that any offers that come in will already have taken that impending repair into place, meaning that there will likely not be further negotiations regarding the seller needing to replace the roof or crediting the buyer for the repair. 

Because the information is already out there for potential buyers, the repair cost should be taken into account when buyers make the offer, which minimizes the chances of the buyer being surprised by this repair and the risk of the property falling out of contract.

Costs of Inspections

These inspections don’t come without a cost. Home and pest inspections vary depending on the size of the house, and can exceed $1000 in many cases. Again, that $1000 helps reduce the risk of future litigation and helps limit buyers’ ability to renegotiate or cancel a purchase agreement after one is accepted. We believe those benefits are well worth the cost.

What if something terrible is uncovered?

A big downside to doing inspections is uncovering something substantial that will greatly impact the outcome of the sale. While this does happen on occasion, sellers must keep in mind that if they didn’t uncover the issue, a buyer likely would after getting into contract. And that could lead to more substantial renegotiation or cancellation of the purchase contract. Canceling the purchase contract is not ideal because in our hot market, canceled contracts and “back on market” properties come with a stigma that causes many buyers to avoid looking at them.

Conclusion

In most cases, we highly recommend that sellers provide at least the big three inspection reports: general home, pest, and roof. Based on these reports, we may also advise follow-up inspections. These are done in an effort to report exposure to post-close litigation and to keep the transaction smooth and, ideally, contingency free.

If you’re looking to sell a home here in Oakland, Berkeley, or the East Bay, you’re going to want the right agent and the right inspectors on your team to help you through your home inspection checklist and navigate the ins and outs of this competitive market.

If you’re interested in potentially working with us on the purchase or sale of your home, start by reaching out to our team today for a free no-strings-attached consultation. You can also reach out directly via phone or text at (510) 995-0035.

We look forward to hearing more about you and your situation and seeing if we’re the right fit to help you reach your real estate goals.