It may not be required by law or your lender, but if you’re purchasing a home, you’ll likely want to consider getting a professional home inspection, which can cost a few hundred dollars.
You may even choose to make your contract contingent on the results.
A basic home inspection typically ranges from $300 to $500, according to the U.S. Department of Housing and Urban Development, and it’s almost always the buyer’s cost to cover.
Here’s what you can expect to get for your money.
What Do Home Inspectors Do?
In the recent frenzied real estate market, which has included sight unseen home buying, some buyers have taken the risk of waiving the home inspection.
But certified home inspectors are trained to find the problems you might not see when you walk through a home that’s for sale (even if you’ve seen the property multiple times).
Many states require inspectors to be licensed, and there are several professional organizations that require their members to follow certain standards of practice. Two of the largest national organizations for certified inspectors are the International Association of Certified Home Inspectors (InterNACHI) and the American Society of Home Inspectors (ASHI), but there are also many state associations.
The goal of a professional inspection is to help you avoid being surprised by structural defects, plumbing and electrical issues, or other significant problems with a home you plan to buy. Here are just a few of the things on a home inspection checklist that an inspector will look at.
Inspectors aren’t required to stand on a roof to inspect its condition, but they will review the materials used to cover the roof; the gutters and downspouts; any vents, flashing, skylights, etc.; and the general structure of the roof. And they’ll report any evidence of active leaks.
This part of the inspection will generally include the exterior walls; the eaves, soffits, and fascia; windows and doors (including garage doors); walkways and driveways; stairs, steps, and ramps; porches, patios, decks, and the like; railings; and any issues that could cause problems with water intrusion.
This typically includes looking for cracks or other problems with the home’s foundation, the basement or crawlspace, and other structural components.
Heating and Cooling
The inspector will report on the types of systems used to heat and cool the home and if they are in working order.
This may include checking the main water supply shut-off valve and water heater; running the faucets and flushing all toilets; and reporting drainage problems for sinks, tubs, and showers. The inspector will look for damage, loose connections, leaks, and equipment that wasn’t properly installed.
Besides checking a representative number of switches, light fixtures, and receptacles, the inspector will look at the type of wiring used in the home, the electrical panel, the main service disconnect, and any equipment that wasn’t properly installed or repaired. The absence of smoke detectors and carbon monoxide detectors also will be noted.
Insulation and Ventilation
The inspector may note any issues with the insulation used in the home, including the depth and type, and the exhaust systems in the kitchen, bathrooms, and laundry room.
What Isn’t Included in a Basic Home Inspection?
A basic inspection is a noninvasive, visual assessment of accessible areas of the property, so inspectors may not move rugs, furniture, or other items that block their view. If there’s a problem behind a wall or under the floors, the inspector may not catch it. And you shouldn’t expect the inspector to predict how long the roof, appliances, or HVAC system might last.
You may have to hire specialists, and that could add to your overall costs. Specialized inspections might include looking at the swimming pool, fireplace chimney and flue, a well and/or septic tank, and detached sheds and garages. You also may choose to get separate inspections to search for mold, termites, asbestos, lead paint, or radon gas, and to check for municipal code compliance.
While the cost of a single-family home inspection normally ranges from $300 to $500, the price can go significantly higher depending on the home’s square footage and the addition of specialized inspections.
You’ve probably already looked at numbers with a mortgage calculator or plan to. That’s more money you’ll need to come up with before or during your closing.
Why Get a Home Inspection?
A home inspection can cost hundreds of dollars, but getting one could save you thousands. After all, the home you’re buying could be the biggest investment you’ve ever made.
Once you receive your inspection report, it will be up to you to decide if and how you want to move forward with the purchase.
As a buyer, you may have a few options, including:
• If there are problems, you can give the seller a list of requested repairs (based on the inspection, not your taste) that must be completed and paid for as a condition of the sale
• You may request a credit, or a concession, that gives you enough to pay for the necessary repairs yourself
• You could back out of the deal altogether
You don’t have to do anything, by the way. If you want the home and you think the price is fair, you can proceed with the transaction even if the report lists major issues.
Especially in a hot seller’s market, you may not be able to use the report as a negotiation tool to lower the price or get the seller to pay for repairs. Still, you’ll have the information you need to make the best decision for your personal needs and goals.
Home Inspection Pros and Cons
|Can give you an unbiased evaluation of the home you hope to buy||Adds a cost to the already expensive home buying process|
|Can help you decide if repairs are in your DIY skill set or would require a pro||Waiving the inspection is risky (even if it makes your offer more appealing in a seller’s market)|
|May help you assess if the asking price is fair or if you should negotiate|
|May enable you to ask the seller to make repairs before you buy|
Is an Inspection Necessary for a New or Renovated Home?
It might be tempting to waive the inspection if you’re buying new construction or a home that looks new thanks to a remodel. Fresh paint, that “new home smell,” and some professional staging can be a distraction for eager buyers. But even new construction can have problems, and an inspection can help find red flags.
What Factors Into the Price of a Home Inspection?
When you’re shopping for an inspector, you may want to ask for a written estimate of how much you’ll be charged and a breakdown of costs. Here are some things that could affect the price:
The larger the home, the longer it could take to complete the inspection and the inspection report. Here’s a breakdown of approximate costs based on square footage:
|Home Size||Approximate Cost|
|Under 1,500 sq. ft.||$250|
|1,500 to 2,500 sq. ft.||$325|
|2,500 to 3,000 sq. ft.||$380|
|3,000 to 4,000 sq. ft.||$420|
|Over 4,000 sq. ft.||$500-plus|
Because it may take more time — depending on the condition of the home and the design — the inspection for an older home may cost more than for a newer build of the same approximate size.
If the inspector must travel a long distance to get to the home, the cost estimate may be higher. (The inspector may charge by the mile or a negotiated amount.)
How much experience does the inspector have? Are they licensed by your state and/or certified by a professional association like ASHI or InterNACHI? You may have to pay extra for this expertise.
The first price you’re quoted may not be the final price you’ll pay for an inspection. If you want additional inspections that require more expertise or specialized equipment, you can expect to pay much more. Inspecting detached structures on the property also may increase the price. Ask about those separate costs and if they’ll be listed on your written estimate.
How Long Does an Inspection Take?
A home inspection typically takes two to three hours onsite, and you may have to wait one or two days to get your inspection report. You may find it helps to research inspectors even before you find a home so you can move quickly when you’re ready to buy. That way you’ll have plenty of time to read the report and decide what you want to do about any points of concern.
Home inspection contingencies, which can allow buyers to get out of the contract if they find something they don’t like, usually have a tight deadline. You may have to send formal notice to the seller that you’re canceling the contract within seven days after signing the purchase agreement.
Are Any Fixes Mandatory After an Inspection?
A home inspector’s report isn’t a list of “must-dos.” Most repairs are negotiable. And you may decide not to press the seller for any fixes.
In some cases, a buyer may be denied financing or insurance if the bank or insurer isn’t satisfied with the results of an inspection and the planned repairs. Those items likely would include dangerous structural or electrical defects and/or building code violations.
Tips on Choosing an Inspector
Word-of-mouth references can be a great place to start when you’re looking for a home inspector. There are also plenty of online sites that can help you find local inspectors.
Once you have a few names, you can:
Look for Online Reviews
There are several sites that list inspectors, and some offer reviews. You also can ask the inspector for references.
Is the inspector a member of a professional organization? You may want to ask to see a membership card. And don’t forget to ask for proof of licensing if it’s required in your state.
Ask About Experience
How long has the inspector been in the business? Experienced inspectors likely will have seen several types of homes and know where to look for problems.
Get Pricing Information
You can start by asking about the cost of a basic inspection and what it includes, then go from there. If the inspector does specialized tests you’re interested in (for mold, radon, asbestos, etc.), you can request to have those costs included in the estimate.
Compare Sample Reports
One way to gauge an inspector’s work may be to look at a past report and compare it to other companies’ reports.
Set the Date
Keep your timeline in mind as you consider who to hire. Things can move quickly in the mortgage process, and you don’t want your inspection to hold up the deal.
Try to be there when the inspector is working so you can see the home through an unbiased lens. If you can’t be there, you may want to ask your real estate agent to attend.
It might be tempting to skip the home inspection to save money or time, or to make your offer more appealing. After all, the average home inspection cost is $300 to $500 and could go higher. But a home inspection can provide an important layer of protection.
3 Home Loan Tips
- Traditionally, mortgage lenders like to see a 20% down payment. But some lenders, such as SoFi, offer mortgages with as little as 3% down for qualifying first-time homebuyers and 5% down for other buyers.
- Your parents or grandparents probably got mortgages for 30 years. But these days, you can get a home loan for 20, 15, or 10 years — and pay less interest over the life of the loan.
- Not to be confused with pre-qualification, pre-approval involves a longer application, documentation, and hard credit pulls. Ideally, you want to keep your applications for pre-approval to within the same 14- to 45-day period, since many hard credit pulls outside the given time period can adversely affect your credit score, which in turn affects the mortgage terms you’ll be offered.
Photo credit: iStock/Altayb
SoFi Loan Products
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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.