The Art of the Pre-Listing Inspection

The single most consistent thing about the home inspection business is that it never stays the same. Nimble is the mantra for a modern home inspector, constantly adapting to new technologies, new construction techniques, and new market conditions. When I started my home inspection company over 18 years ago I would never have imagined that almost all of my work today would be for people selling their houses. Pre-listing inspections, or doing a home inspection for a home seller, was nearly unheard of then. And, yet, here we are in 2022, and pre-listing inspections have become a powerful tool to get your house ready for the market and clear the way for a smooth transaction.

So what has changed? Why are pre-listing inspections more popular today? And what are their benefits and drawbacks? This article will unpack some history in the Seattle area real estate market to help unpack how we have arrived where we are today.

Inventory

The underlying driver of the current market can be summed up in a word: inventory. At least in my market (the greater Seattle area), there are not enough houses for sale relative to the number of interested buyers. This has driven prices up and created situations where every house that sells has multiple different buyers competing for the same house. In our market, this is not a new problem. I first noticed this trend leading up to the 2008 housing collapse. Back in 2006 and 2007, limited time to perform inspections and heated competition for a single house started creating a demand for “pre-inspections.”

The Rise of the “Pre-Inspection”

I have never much cared for the term pre-inspection, I prefer to call these cursory verbal consultations because these inspections were often done on the quick and the cheap because a buyer wasn’t sure whether they would even win the house, so there was no point in paying for a full-blown, detailed, home inspection. To be frank, these were poor-quality inspections. I was sometimes on-site with as many as three other inspectors all trying to look at the house at the same time. The inspection atmosphere was a circus, and quality suffered. Homebuyers were hurt as they were buying houses without a proper understanding of the building’s condition while also spending thousands of dollars on fruitless verbal consultations. The verbal consultation, from my perspective, was a failure of a solution to the tight inventory conditions.

Then came the 2008 collapse

When the housing market collapsed in 2008, I was horrified to spend the next two or three years inspecting houses that were now foreclosed or nearly foreclosed. Not only did these underwater homeowners owe more to the bank than their house was worth, but they were also discovering a whole host of problems with the building that they were unaware of when they purchased the house. I was back to doing full inspection reports for home buyers, but the market was generally sad and I saw first-hand the harm that poor quality verbal consultation inspections had done to struggling home buyers.

Why I think pre-listing inspections can be so great

Fast forward to today’s market and we are back to multiple offers and crazy times for home buyers. And while I would always encourage every home buyer to hire their own home inspector, if there is no time to do that I think one high-quality inspection is better than 10 quick and dirty verbal consultations. And this gets us to how pre-listing inspections have changed my inspection business and my report writing.

In the old days, when inspectors worked for homebuyers, a report was simply a repair list; a defect-only regurgitation of repair findings that were uncovered during the inspection. The buyer was usually present at the inspection, so often the writing of the report was just a formal regurgitation of these findings.

When I write pre-listing inspection reports today, I realize that as many as 20 or 30 different families could be reading and depending on this report and all of those people would bring to the table different sets of desires and expectations. I have spent the last five or six years honing my report-writing skills for pre-listing inspections so that I now write what I consider to be a deeply descriptive home inspection report; I talk more about my pre-listing reports in this pre-listing inspection report video. This includes not just repair items but things that have been updated. I try to provide a comprehensive picture of updates, remaining useful services lives, and an understanding of the testing procedures used during the inspection. This produces a document that is full of valuable information that can serve almost as a blueprint for homeowner maintenance if they win the house.

Why pre-listing inspections have a potential dark downside.

The reality is that not all home inspectors write reports that are designed to be pre-listing inspections, however. In fact, most home inspectors rely on report writing software that never had such detailed reports in mind.

A friend of mine’s son was in the house-buying process recently and he asked me to review a pre-listing inspection with him. I told him I would be glad to do it and asked him to send me the report. Upon review of the report, I determined that he needed to proceed as though no inspection had been done. The inspection report was so cursory there was no information upon which to make a reliable decision.

The whole purpose of a pre-listing inspection is to get the condition of the building out on the table, warts and all. Trying to use a pre-listing inspection document as a means of obfuscation defeats the purpose entirely.

Tips for reading and preparing for pre-listing inspections

If you are a home buyer and you are reviewing pre-listing inspections, you need to ask yourself how thorough the report looks. Thin reports with little information should tell you that you cannot rely on that information. I would be expecting detailed reports with lots of color photos and even streaming videos that help explain the condition of the building.

If you are a real estate agent, preparing home sellers is critical. I have noticed that some sellers have a difficult time with the forthcoming process of a pre-listing inspection and I have to explain that if I pull punches and don’t provide an honest report the whole thing doesn’t work and falls apart. In my experience, most home sellers seem to appreciate this and like the sense of openness that this creates, but I do not think the pre-listing inspection is for every home seller.

The old model was a bit quirky

If you think about the old model of real estate, it wasn’t unusual to come to a negotiated price for a building, then do a home inspection to figure out its actual condition, and then renegotiate the price. From my perspective, the old way of doing things was a very messy process and there’s a lot to be gained from a nice thorough good pre-listing inspection.

A thorough pre-listing report, though not for everybody, does have some distinct advantages for sellers.

They do not need to renegotiate a price, and even if there are big-ticket items like a new deck is needed, they can just simply put it out on the table and let the home buyers know that they have chosen the price based on detailed information on the quality and condition of the building.
It provides a deep amount of disclosure about the property, making it more difficult for a home buyer to come back and say they were not warned about a particular defect.
It helps create a plan to avert surprises. Nobody likes surprises and last-minute hiccups for the home seller can result in termination of a contract and the loss of a lot of time and heartache.
It helps sellers make repairs before listing to get the home ready for the market in the condition they are hoping and expecting to present the building.

I hope this brief article helps with understanding why and how the home inspection market has changed and why pre-listing inspections can be such a valuable tool.

The most consistent thing about the home inspection business is that it never stays the same. Nimble is the mantra for a modern home inspector, constantly adapting to new technologies, new construction techniques, and new market conditions. When I started my home inspection company over 18 years ago I would never have imagined that almost all of my work today would be for people selling their houses. Pre-listing inspections, or doing a home inspection for home sellers was nearly unheard of 18 years ago. And, yet, here we are in 2022 and pre-listing inspections have become a powerful tool to get your house ready for the market and clear the way for a smooth transaction. So what has changed? Why are pre-listing inspections more popular today? And what are their benefits and drawbacks? This article will unpack some history in the Seattle area real estate market to help unpack how we have arrived where we are today.

Inventory

The underlying driver of the current market can be summed up in a word: inventory. At least in my market, there are no longer many houses for sale relative to the number of interest buyers. This has driven prices up and created situations where every house that sells has multiple offers, or multiple different buyers competing for the same house. I first noticed this trend leading up to the 2008 housing collapse. Back in 2006 and 2007, I started being asked for “pre-inspections.”

The Rise of the “Pre-Inspection”

I have never much cared for the term pre-inspection, I liked to call these cursory verbal consultations and these were done for a buyer before making an offer. These inspections were often done on the quick and the cheap because a buyer wasn’t sure whether they would even win the house, so there was no point in paying for a full-blown home inspection with a nice report. To be frank, these were poor-quality inspections. I was sometimes on-site with as many as three other inspectors all trying to look at the house at the same time. The inspection atmosphere was a circus and quality suffered. I saw home buyers getting hurt as they were buying houses without understanding their actual condition while also spending thousands of dollars on fruitless verbal consultations. The verbal consultation from my perspective was a failure of a solution to the tight inventory conditions.

Then Came The 2008 Collapse

When the housing market collapsed in 2008 I was horrified to spend the next two or three years inspecting houses that were now foreclosed. Not only did these homeowners owe more to the bank than their house was worth, but they were discovering a whole host of problems with the building that they were totally unaware of when they purchased the house. I was back to doing full inspection reports for home buyers, but the market was generally sad and I saw first-hand the harm that poor quality verbal consultation inspections had done to struggling home buyers.

Why I think pre-listing inspections can be so great

Fast forward to today’s market and we are back to multiple offers and crazy times for home buyers. And while I would always encourage every home buyer to hire their own home inspector, if there is no time to do that I think one high-quality inspection is better than 10 quick and dirty verbal consultations. And this gets us to how pre-listing inspections have changed my inspection business and my report writing.

In the old days, when inspectors worked for homebuyers, a report was simply a repair list, defect-only regurgitation of repair findings that were uncovered during the inspection and the buyer was usually present at the inspection, so often the writing of the report was a formal regurgitation of these findings.

When I write pre-listing inspection reports today, I try to realize that as many as 20 or 30 different families could be reading and depending on this report and all of those people would bring to the table different sets of desires and expectations. I have spent the last five or six years honing my report writing skills for pre-listing inspections so that I write what I consider to be a deeply descriptive home inspection report. This includes not just repair items but things that have been updated. I try to give a very complete picture of what things were working and what things were not working at the time of inspection, what things have been updated, and what things are old. This produces a document that is full of valuable information that can serve almost as a blueprint for homeowner maintenance if they win the house.

Why pre-listing inspections have a potential dark downside.

The reality is, that not all home inspectors write reports that are designed to be pre-listing inspections. In fact, most home inspectors rely on report writing software that never had such detailed reports in mind.

I find it distressing that professionals in the real estate industry consider this a reasonable way to do a pre-listing inspection. The whole purpose of a pre-listing inspection is to get the condition of the building out on the table, warts and all. Trying to use a pre-listing inspection document as a means of obfuscation defeats the purpose entirely.

Tips for reading and preparing sellers for pre-listing inspections

If you are a real estate agent you need to have a Frank discussion with home sellers. I have noticed that some sellers have a difficult time with the forthcoming process of a pre-listing inspection and I have to explain that if I pull punches and don’t provide an honest report the whole thing doesn’t work and falls apart. In my experience, most home sellers seem to appreciate this and like the sense of openness that this creates.

If you think about the old model of real estate it is quite odd to come to a negotiated price for a building then do a home inspection to figure out its actual condition and then renegotiate the price. From my perspective, the old way of doing things was a messy process and there is a lot to be gained from a nice thorough pre-listing inspection.

Pre-listing inspections offer some distinct advantages for sellers.

Sellers reduce the risk of last-minute surprises and needing to renegotiate a sales price. Sven if there are big-ticket items like a new deck is needed, they can just simply put it out on the table and let the home buyers know that they have chosen the price based on detailed information on the quality and condition of the building.
Sellers can develop a plan with their real estate professional for getting the house ready for the market in the condition they wish to present the house. This can be anywhere from fixer to turn-key, but when you take this approach you are in the driver’s seat as the seller.
Sellers can maintain control of repairs. With such limited time to find contractors, even basic repairs like wiring can take weeks to get scheduled. A buyer might ask for exorbitant concessions in the face of unknown repairs. With pre-listing inspections, time is on the seller’s side. Estimates and repairs can be scheduled and made to reduce the risk of the unknown, helping all parties come to a fair price.
Sellers reduce their liability by providing a value and detailed disclosure document.
Sellers reduce the risk of having a seller rescind their contract, wasting time and money coming off the market and then coming back on.

I hope this brief article helps with understanding why and how the home inspection market has changed and why pre-listing inspections can be such a valuable tool.

Inventory

The Rise of the “Pre-Inspection:

I have never much cared for the term pre-inspection, I liked to call these cursory verbal consultations and these were done for a buyer prior to making an offer. These inspections were often done on the quick and the cheap because a buyer wasn’t sure whether they would even win the house, so there was no point in paying for a full-blown home inspection with a nice report. To be frank, these were poor-quality inspections. I was sometimes on-site with as many as three other inspectors all trying to look at the house at the same time. The inspection atmosphere was a circus and quality suffered. I saw home buyers getting hurt as they were buying houses without understanding their actual condition while also spending thousands of dollars on fruitless verbal consultations. The verbal consultation from my perspective was a failure of a solution to the tight inventory conditions.

Then Came The 2008 Collapse

When the housing market collapsed in 2008 I was horrified to spend the next two or three years inspecting houses that were now foreclosed. Not only did these homeowners owe more to the bank than their house was worth, but they were discovering a whole host of problems with the building that they were totally unaware of when they purchased the house. I was back to doing full inspection reports for home buyers, but the market was generally sad and I saw first-hand the damage that poor quality verbal consultation inspections

Why I think pre-listing inspections can be so great

Fast forward to today’s market and why I think pre-listing inspections can be so valuable is that it allows at least one high-quality inspection to be done with a high-quality report.

From my perspective as a home inspector, it is completely transformed how I write a report. And the old days a report was simply a regurgitation of repair findings that were uncovered during the inspection and the buyer was usually present at the inspection so often the writing of the report was a formal regurgitation of these findings.

When I write pre-listing inspections I try to realize that as many as 20 or 30 different people could be reading this report and all of those people would bring to the table different sets of expectations. I have spent the last five or six years honing my report writing skills for pre-listing inspections so that I write what I consider to be a deeply descriptive home inspection report. This includes not just repair items but things that have been updated. I try to give a very complete picture of what things were working and what things were not working at the time of inspection, what things have been updated, and what things are old. This produces a document that is full of valuable information that can serve almost as a blueprint for homeowner maintenance if they win the house.

Why pre-listing inspections can have a dark downside.

The reality is, that not all home inspectors write reports that are designed to be pre-listing inspections. In fact kind of most home inspectors rely on report writing software that never had such detailed reports in mind.

A friend of mine’s son was in the house buying process recently and he asked me to review a pre-listing inspection with him. I told him I would be glad to do it and asked him to send me the report. Upon review of the report, I determined that he needed to proceed as though no inspection had been done. The inspection was very short and had almost no information in it.

I find it continually distressing that professionals in the real estate industry consider this a reasonable way to do a pre-listing inspection. To be perfectly clear, the whole purpose of a pre-listing inspection is to get the condition of the building out on the table, warts and all. Trying to use a pre-listing inspection document as a means of obsification defeats the entire purpose of the pre-listing inspection.

Tips for pre-listing inspections

If you are a real estate agent you need to have a Frank discussion with home sellers. I have noticed that some sellers have a difficult time with the forthcoming process of a pre-listing inspection and I have to explain that if I pull punches and don’t provide an honest report the whole thing doesn’t work and falls apart. In my experience most home sellers seem to appreciate this and like the sense of openness that this creates.

If you think about the old model of real estate it is quite odd to come to a negotiated price for a building then do a home inspection to figure out its actual condition and then renegotiate the price. From my perspective, the old way of doing things was a very messy process and there’s a lot to be gained from a nice thorough good pre-listing inspection.

There are some distinct advantages for sellers. They do not need to renegotiate a price, and even if there are big-ticket items like a new deck is needed, they can just simply put it out on the table and let the home buyers know that they have chosen the price based on detailed information on the quality and condition of the building.

Summary

I hope this brief article helps with understanding why and how the home inspection market has changed and why pre-listing inspections can be such a valuable tool. The thing I have learned in this business is that every house is a great house for the right person at the right price. The game is one of match-making and managing expectations so we can all find the house we are looking for as painlessly as possible. Please feel free to reach out to our team for any of your home inspection needs: pre-listing or pre-purchase, we are here to help.