Here in West Michigan and specifically the Greater Grand Rapids area it is hard to get an accepted offer, especially if you are a first time home buyer. It is common to hear of buyers that have lost out on 10+ homes the put an offer on and most of these homes are going for over asking price. There are several tactics that realtors will recommend in a market like the one we are experiencing now. Here are some of the most common that are related to the right to inspections:
Waiving your right to inspections… this is becoming more and more common, obviously I am biased, but waiving inspections can be a very costly mistake even on newer homes. There can be huge issues that an experienced home inspector can spot and point out and explain the possible ramifications. Sellers do love this option and will often accept the bid, however you may be purchasing a money pit, but only time will tell.
Pass or fail inspections… realtors will tell the seller that inspections will be pass or fail, which basically means you are not going to ask the sellers to fix anything or pay anything. You will simply decide to continue with the purchase or walk away after the inspections are done. This is one of my personal favorites because it makes your bid more attractive to the seller, allows you to properly inspect the home and you still have the choice to walk away.
Shortening the inspection window… normally you have 10 days once the purchase agreement is signed, some realtors are recommending shortening that to 5 days and even 3 days. This does make your offer more attractive but there are definitely some down sides. First of all these are literal days (unless business days are specified) so this can be challenging to find a good inspector that has that type of availability. It also does not allow time for further investigation. Inspectors are not specialists and a lot of times further investigation is needed by a specialist (foundation specialist, HVAC contractor, electrician, etc.) This can put you in a spot where you have to make a decision without this important information.
The Normal 10 day window… so this one is not a trick it is the normal procedure so it does not give you an advantage on your offer but it does make sure that you have time to hire the inspector you want, and a few days in case you need to have a trade contractor or specialist go out to the home and quote repairs or look into possible issues.
Although it may be frustrating to keep losing out on houses, I can guarantee you it will not come close to the amount of frustration you will experience if you get stuck with a money pit of a home. If you decide to use one of these tactics to better your chances I would recommend the pass or fail inspection, even though you lose your ability to negotiate you still have the time and ability to choose your inspector, have further investigations if needed, and you can walk away without losing your Earnest Money Deposit.
Danny Geurink, Certified Master Inspector
Your Grand Rapids Home Inspector
