Inspections a major cause of deals busting? Studies say no
By Darla Shelden on February 7, 2018
by Jack L. Werner, Ph.D. A to Z Inspections
A National Association of Realtors survey revealed, “only 64 percent of purchase contracts settled on time, 29% experienced delays and 7% fell apart.”
Of the 7% that do not close, what gets in the way?
• 39% Financing issues
• 16% Appraisal disagreements
• 11% Title and deed problems
• 9% Inspections (so 9% of the 7%–or about 6/10 of a percent–that do not close are due to inspections)
• 8% Contingencies in the contract
• The remainder – buyer or seller cold feet, HOA’s creating obstacles, buyers losing jobs.
Inspectors are often feared as “deal-killers”. Very few sales fail as a result of inspections. A deal that failed because of negative inspection findings is probably a positive for the seller, buyer, and real estate agent. Finding problems before a lot of money changes hands most likely prevents losses, future lawsuits, and hits to an agent’s reputation.
“The best defense is a good offense.” A tough pre-listing (or seller’s) inspection will prevent the “surprise” negative inspection coming after all the parties have contracted. The seller can use the information to make repairs the seller wants to make and be prepared to discuss/negotiate the remaining. Listen to an expert. Gary Keller of Keller-Williams advises to always get a seller’s inspection.
Commercial and residential property purchases are major commitments. Failure to secure the most thorough professional property inspection available is a failure to demand the due diligence we would normally exercise when purchasing a used car, selecting a physician, or considering an investment advisor. Barry Sone, whose syndicated column “House Detective” runs in the Oklahoman, says that the inspector you want to hire is known by the following phrases: “too picky,” “deal killer,” “takes too long,” “nitpicks everything.”
A pre-listing/seller’s inspection by a tough inspector can make for smooth “sale-ing”!
NOTE: Jack L. Werner, Ph.D., owns A to Z Inspections and can be reached at 405/412-7861 or [email protected]. A to Z Inspections performs commercial and residential inspections. Learn more at www.atozinspectionsok.com. Jack has a construction degree from OSU and was Oklahoma’s first designated Master Inspector. He teaches inspections as well as courses for the Oklahoma State Home Builders. The National Association of Home Builders named him a Master Instructor in 2017. Werner is a regular columnist for The City Sentinel print edition. He can be reached at 405-412-7861 or [email protected].