How to Negotiate Home Inspection Credits and Repairs?

The home inspection is the first major hurdle after ratifying a contract. A lot of transactions fall through at this point. Often this is because buyers don’t know how to negotiate home inspection items.

I think it really comes down to expectations. Below are some problems areas I see all the time.

Asking for Cosmetic Issues to Be Fixed

You’re buying a house that’s already been lived in. Expect some wear and tear on it. Sellers are very unlikely to address paint scuffs, floor scratches, dinged appliances, etc. If they wanted to deal with such issues, they would have done it before putting the house on the market.

One exception is new construction or total renovation listings. Then it’s okay to ask for every surface to be perfect. Plus builders and flippers already have contractors ready to come in and quickly address cosmetic issues.

This is not the case with regular sellers. They’ll have to make phone calls, obtain quotes and deal with contractors coming into their home. Keep in mind that the sellers have a ton of other things on their plate such as packing, arranging a new place to live, dealing with schools, etc. Asking them to deal with bad paint might be just enough to derail the entire contract.

The overall condition of the property should have factored into your offer price well before the inspection. If time allows, ask your agent for a second showing, preferably during full daylight.

Trying to Re-Negotiate the Sales Price

The purpose of the home inspection is to uncover any unknown facts about the property that could change your mind about buying it. For example, a bad foundation or leaking roof.

It’s definitely not another negotiation round on the sales price. Keep in mind that no house is ever perfect.

If you see serious issues, by all means, ask for repairs or credits. However, if you try to point out every little thing that’s not perfect, the sellers aren’t likely to budge. On the contrary, they may think about trying to void the contract and going for another buyer.

Asking for Everything on the Inspection Report

It does happen. The buyers ask for all 50 items on the inspection report. These range from loose outlets to old windows to trimming brushes away from the exterior.

A good inspector will point out a lot of recommended maintenance which makes up the bulk of the report. It’s more of a reminder what you’ll need to do after you become a homeowner. However, it’s unlikely you’ll get the sellers to do these for you.

When looking through the list of inspection issues, I try to think which would upset another buyer as well. This is usually the serious stuff. Sellers are more open to addressing these since they’ll probably come up again. So there isn’t much sense trying to wait for another buyer.

Expecting that Every Old Appliance Will Be Replaced

The inspector will often tell you the life expectancy on the appliances and major systems. In some cases, an appliance will be well past its due date, but still working fine. I’ve seen a 28-year old water heater just humming along (expected life span is usually 8-12 years).

Just because something could be replaced, doesn’t mean it will be replaced by the seller. This is especially true for older appliances. Plus, even if they agree on the replacement, you have no control over what they get. It could be a subpar model bought online.

How to Negotiate Home Inspection Credits and Repairs

Staying reasonable is probably the single most important thing. There will be give and take on both sides. Of course, some cases give you more leverage than others. Competitive listings with multiple offers aren’t likely to accommodate a long list of repairs.

Plus you want to retain some goodwill in case there are appraisal issues or you need a favor from the seller later in the transaction.

I usually advise my clients to ask for seller credit when discretion is advised. For example, replacing a rusted or leaking water heater. The seller will just get the cheapest one available. You might want to get something better or maybe upgrade to a tank-less system.

If the repair is more of a pass/fail kind, then it should be okay asking the seller to fix it. For example, fixing a bad GFCI outlet or squeaky shower diverter.

A good agent should be able to point out quite a few issues during the showing. They can check the manufacture dates on appliances and major systems, look for signs of trouble, etc. This way the home inspection shouldn’t have a ton of surprises.

In Conclusion

Hopefully this post on how to negotiate home inspection issues has been helpful. Here are a few more related posts you may want to check out: typical, 7 common home inspection issues and 5 maintenance tips for new homeowners.

Feel free to contact me below if you have further questions:

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