It’s an industry joke that some buyers request the seller to repair even the most minor issue found on a home inspection, like a leaky faucet for example. But over the past couple of years, most sellers could list their house and it would quickly sell for over asking price — and buyers would often waive the home inspection — so sellers wouldn’t have to worry about that at all. Even if the buyers did have an inspection, sellers could easily reply with a firm no, and the buyers would be fine with it.
So if you’re about to put your house on the market, even if you’ve heard that the market is shifting, you may still be holding onto the hope that things will be the same for you.
The good news is that you’re still in a great position to get a historically high price for your house. That’s despite the fact that we’re in a “housing recession” according to this CNBC article. To put it simply, since inventory is still low for the number of buyers looking for a home, prices aren’t coming down, but the number of homes actually selling have been dropping.
But what sellers should be sensitive to is that buyers are now less likely to waive their rights to a home inspection, as reported by Fortune last week. In addition to that, they followed up this week stating that 16.1% of buyers backed out of deals in July — the highest rate since April 2020. Back in 2020, buyers were canceling contracts due to financial concerns caused by the emerging pandemic. Now more buyers seem to be backing out due to home inspection issues.
Are they all due to home inspection issues? Probably not. Some of them are likely due to financing issues, or any other number of factors. But those using home inspection issues as a reason to back out could also be using it as a remedy for buyer’s remorse — a more technical term for getting cold feet —over their decision.
It doesn’t matter if the buyer is simply using home inspection issues as a handy excuse, or they’re truly concerned about issues found during the home inspection; you should be ready and willing to address their concerns and requests. A buyer can’t easily back out of their contract if you agree to address any problems they find. (And yes, this even means those nitpicky items, like a leaky faucet, that you may feel is being a bit greedy on their part.)
If you do, and have to put your house back on the market, you could find that your house doesn’t sell readily, or for as much as you initially accepted. Plus, your next buyer might throw the same (and possibly more) inspection issues at you.
The Takeaway:
It’s just not worth the risk of losing a buyer in this market. Things are shifting, and the market is already drastically changed from how it was just a few months ago. Yet you’re still in a solid position as a seller to get a historically high price for your house. So, if you find yourself being asked to take care of home inspection issues, truly analyze whether it’s worth being stubborn. Will buyers get even more picky and demanding in the near future? What if there’s more inventory / competition? Will you be able to get as high of a sales price?
While it may seem like you’re caving in and taking a financial hit other sellers didn’t have to take recently, consider how much your home was worth in 2020 (the last time buyers were backing out at this rate). The equity you’ve likely gained just by owning during this period probably far outweighs whatever the cost of whatever your buyer is asking for. Don’t let pride or principles get in the way of moving on and getting as much as you can for your house right now.
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