Items to Check before a Home Inspection

Selling a home can be a stressful time, there is so much to think about; keeping the home clean, heading out on a moment’s notice to accommodate last minute showings, not to mention planning a move. It’s natural to feel overwhelmed.

Then you get that great offer and enter escrow. You’re relieved until you realize there’s a home inspection coming. Even a home meticulously maintained can have hidden issues. The good news is that you can prepare for the home inspection and make sure you pass with flying colors.

Items to Check before a Home Inspection

  • Doors, windows, cabinets and drawers – check that they slide smoothly
  • Run water in sinks, tubs and showers – snake any that drain slowly
  • Evidence of water leaks – Garage ceiling, under sinks, around water heaters, etc.
  • GFIs – check your local code and put GFI plugs where required
  • Smoke and Carbon Monoxide Detectors must be in working order
  • Gutters and Roof – replace any missing roof tiles and clean gutters
  • HVAC – Consider a HVAC servicing to replace filters and check for problems
  • Water Heater – is it properly strapped and vented
  • Deferred maintenance – anything that has been neglected should be addressed before the home inspection
  • Check out your crawl space, is there moisture issues, standing water anywhere?
  • Have your HVAC serviced if you haven’t done so recently.

The best defense is a good offense. This is true in home inspections too! The best way to ensure you have a great home inspection is to have a pre-listing home inspection. It could be the best couple hundred dollars you can spend – uncover the issues before the buyer does.

The A Team

What is Dual Agency and When is it Ok?

What is Dual Agency?

Dual agency is a situation to describe when a real estate agent works with both the buyer and the seller. Most people familiar with the housing market know that a buyer’s agent works for the buyer, a listing agent for the seller, but there’s a third category that’s much more mysterious: the dual agent.

Dual agents, also known as transaction brokers, work for both the buyer and the seller, combining both roles into one. Buyers might stumble across this scenario when they fall in love with a home where the agent they’ve hired to represent them also happens to represent the seller. It’s rare, but it happens, especially in smaller markets where there aren’t a whole lot of properties to go around.

Dual agency can also mean that the buyer and seller have separate agents at the same real estate firm, which most often happens with large brokerages with lots of listings. This is better known as Designated Dual Agency.

Certain states (but not all) permit dual agency as long as it’s disclosed to both buyers and sellers. But is dual agency a good idea? Well, yes and no. There are both advantages and disadvantages to buying a house through dual agency. Here are the pros and cons.

Benefits of dual agency

Dual agency can certainly streamline the home-buying process. Think about it: If both buyer and seller have their own separate agents, there will be four people’s schedules that must be consulted before the property can be shown. Cut one agent out, and it makes scheduling 25% easier. Or thereabouts.

Another potential perk of a dual agent is it can save you on the commission—the money home sellers pay their agent for all their hard work (typically 6% of the sales price of a home), which is then split with the corresponding buyer’s agent for all their hard work. A dual agent, however, keeps the whole kit and caboodle. (Good for them!) As a result, dual agents may be more open than usual to lowering that commission a bit.

Downsides of dual agency

A dual agent is supposed to be neutral, helping clients on both sides of the deal equally. But staying truly neutral can be difficult. For instance, since an agent’s commission is a percentage of a home’s sales price, it’s inherently in an agent’s best interest to get a high selling price, because he’ll make more money. That’s good for the seller, but not so much for the buyer.

Also, since a dual agent works for both buyer and seller, he must tread carefully not to betray the confidence of either party. So, he might stay mum about juicy tidbits that you might have more easily learned if you’d had your own agent in your corner.

For instance: A listing agent might know his clients are desperate to sell. If the buyer’s agent finds that out, he can inform his clients of their added negotiation power. A dual agent, on the other hand, might be compelled to keep mum about all personal matters.

When to use a dual agent

In states that allow this practice, agents are required by law to inform clients if they’re facing a dual agency scenario—and they can’t move forward without all parties’ informed consent. What’s more, both buyers and sellers have the right to opt out and use another agent so both parties have their own representation.

There are situations where using a dual agent makes sense. An example would be if you and your neighbor struck up a deal to sell your home and have already negotiated the terms, price, etc. You might want to use a transactional Realtor (dual agent) to assist both parties toward the closing. (This is also a case where you may want to ask for a lower commission, since so much of the deal is already ironed out.)

The A Team

Credit at Closing vs. Repairs

When your listing receives an accepted offer, expect the buyer to enlist the services of a home inspector before the contract is complete. Even a brand-new home isn’t perfect. Buyers often use home inspections to negotiate during the buying process.

Home Inspection Purpose
A home inspection is designed to ensure there aren’t any significant defects in the home. A buyer wants to know if the roof is in good condition, the air conditioning and heating system work well and there are no noticeable leaks or other potentially costly issues. However, the inspection is not designed to give the buyer more power in the negotiations of the agreed upon selling price or enlist the seller to fix a long punch list of items. Expect to make accommodations for unsatisfactory items but a seller shouldn’t be fixing every tiny detail.

Credits vs. Repairs
If something does come up that needs to be repaired, it is often best to aim for a credit at closing versus repairing the item. Repair work can be costly, time consuming and come with unexpected issues. Doing what you can to avoid repairing items is in your best interest as an agent. A credit for the expected cost of the repair is a valid way to address the concern. For example, offer a credit toward a new roof instead of having the roof replaced by the homeowner. Potential issues that can arise from repairs include:

  • Buyers have their own ideas of what the repair should look like
  • Buyers can nitpick the entire process
  • Potential closing delay
  • Often longer than expected repair timelines

Home Repair Negotiation
Negotiations are a part of any home selling process. A happy buyer makes selling the home easier on everyone and leads to more referrals for you. As a good realtor you are there to help guide your clients every step of the way.

The A Team