To Pre or not to Pre - That is the Question!!

Real Estate Agent with ExecuHome Realty
Inspections & Appraisals?

One way REALTORS® can ensure that they and their clients know the true condition and value of the home they’re putting on the market is by getting a guaranteed pre-inspection by a professional inspection company and a pre-appraisal.

Everyone knows pricing and condition will play a Major Role in home sales. But not everyone agrees on what is smart or how to go about leveraging these elements.

So what does everyone think about getting homes pre-appraised or pre-inspected?  Please share your experiences, ideas, opinions. 

Below are my thoughts: 

So why Pre-Inspection...

  • A guaranteed pre-inspection is an effective selling tool, reassuring buyers that what they see is what they get. It also eliminates the buyer-beware attitude and can speed up negotiations between buyer and seller.

  • With a home pre-inspection, sellers have the opportunity to address any defects an inspector might find and have them repaired before a possible buyer even sees the house. That gives the seller and sales associate peace of mind that the property they’re listing has no surprises awaiting them in the contract or in the appraisal.

  • It also eliminates last-minute price negotiating and the possibility that buyers might develop cold feet regarding a sale once their buyer inspection uncovers a needed repair, often bringing into question the whole purchase

In today's buyer's market, condition has become as important as the long-lauded “location, location, location.”   Buyer's are aware that sellers are more flexible and willing to negotiate.  Sellers STILLwant the most money out of their equity.  Pre-Inspections are a way to attempt to satisfy both sides of the transaction. 

Buyers will feel more secure about the property they are looking at and sellers will be able to alleviate those unexpected last minute, deal-killing problems by eliminating surprises before they happen.

So why Pre-Appraisal...

Everyone knows pricing will now play a Major role in home sales. But not everyone agrees on what is smart.

  • A pre-appraised home helps the sellers to be competitive while still securing more of the equity they have built.

  • It allows a potential buyer to see value compared to other properties on the market.

  • It almost guarantees value for the second appraisal that the buyers are inevitably going to get which almost eliminates the need to renegotiate a price reduction.

A pre-appraisal may not be the final listing price, but will give the seller and their Realtor more confidence in the negotiating process.

Sellers should verify that the inspection company uses inspectors who carry the proper insurance, including professional liability (errors and omissions), workers’ compensation, and general liability, and are certified by a recognized training and certification program.

* Produced using excerpts from National Association of Realtors website

Comments (6)

Mark Houck
ExecuHome Realty - Abingdon, MD
Apr 21, 2007 02:30 AM
Mary Pope-Handy
Sereno Group Real Estate - Los Gatos, CA
CRS, CIPS, ABR, SRES, Silicon Valley
Most of the time, I think a pre-appraisal is not necessary - at least not in my area. But there have been times when comps were nearly non-existant (very unusual home/land for the area), in those cases I have discussed a pre-appraisal with my clients but not had them be interested in persuing it.  For a very high-end listing, I could see the agent possibly paying for it to get help with pricing (for me, that would be over $2 million).

In my part of Silicon Valley (California - Los Gatos, Saratoga, Almaden), almost every home has pre-sale inspections. Buyers have come to expect it, just like sellers have come to expect that all buyers are pre-approved.
Apr 21, 2007 02:46 AM
Robert Whitelaw
Whitelaw & Sons Real Estate Services - Morgan Hill, CA
Broker, CEO, Realtor , ePro

This is far more common these days in my market than in previous years. The bottom line is that when your putting together your asking price, you need to know all you can. Nobody wants to try to sell their home, only to discover during escrow that there is 20k worth of section 1 work to be done!

I always strongly suggest this be done before we ever put the home in the MLS. 

Apr 21, 2007 03:41 AM
Mark Houck
ExecuHome Realty - Abingdon, MD


First thanks for the response.

Second, am I understanding you correctly that you encourage your sellers to get pre-inspected and appraised before listing their properties?  What type of responses do you get and what type of ways do you overcome their objections to having to spend the money upfront?

Do you have pretty good success at getting these done?

Apr 22, 2007 12:50 PM
Athrine Matthews
Prudential Shimmering Sands Realty - Panama City, FL

I agree with Robert!

In todays market you don't want to finally get the home under contract after being on the market for months; only to find out that you have damages that the buyer is demanding to have repaired and you can't fit it in the budget. This will surly be a surprise that will affect your sellers net.

I think it's best to have it up front. It is already figured in and no surprises. I have had no problems convincing potential sellers to get a pre-inspection. Bottom line major repairs can be a deal killer PERIOD............ 


Apr 22, 2007 01:28 PM
Mark Houck
ExecuHome Realty - Abingdon, MD
Jun 16, 2007 03:34 PM