Property Inspection: Is It Safe To Skip This Step When Buying A House?

If you’ve been shopping for a home in this overheated real estate market, you know that winning a bid on a home these days can require so much strategizing that it feels like you’re on a cutthroat gameshow.

Making sure you don’t lose out on your dream home is a stressful, high-stakes game. But just how far should you go to sweeten your offer? In addition to coming in with a high bid, should you skip the property inspection to help your offer shine by taking down a hurdle for sellers?

Simplemost talked to real estate agents about this risky real estate move, and whether waiving a property inspection is something you should ever consider. Here’s what you need to know about waiving a home inspection, plus some alternatives to helping make your offer more attractive in today’s market, where homes are getting snapped up almost as quickly as the “For Sale” signs go up.

Should You Ever Waive a Property Inspection?

A few factors are at play that are making this market a hypercompetitive one for homebuyers. Historically low interest rates have brought out droves of homebuyers, yet inventory is squeezed and COVID-19 slowed new construction. The result? Home prices hit an all-time high average of $370,000 in March, according to realtor.com, and properties are selling a full week quicker than they did this time a year ago.

Now, buyers are sweetening their offers. Not only are they overbidding on homes (nearly 4 in 10 homes are selling above their listing price, an all-time high), but they’re also tucking terms into their contract to make them stand out to sellers who want a smooth path to the closing table.

One controversial contingency is waiving the property inspection. If you’re taking a mortgage out on a home (i.e. not buying a home with all cash), your lender will require you to get an appraisal, which is an on-site inspection in which the appraiser determines the value of your home. Banks want to make sure the home is worth the money they’re lending you. Interestingly, a home inspection — a process that identifies health, safety and major mechanical issues in a home that could cause you to overextend your budget — isn’t required. But these property inspections do allow you to renegotiate with a seller, requesting, say, that a plumbing problem be fixed before you move in, or the price of the home be reduced as a credit toward fixing a roof that’s in terrible shape.

In general, real estate agents aren’t keen on waiving property inspections, and they advise their clients against ever doing so.

Home Inspector Conducting a Property Inspection
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“It is a hasty decision to waive a home inspection,” says Ellen Schwartz, a real estate agent with Compass who works with buyers and sellers in Westchester County in New York and Fairfield County in Connecticut. “I think it is a mistake to do so as there could be major issues affecting the home that could become a major financial burden.”

Home inspections can turn up some expensive problems in a home. For instance, you may need to replace an HVAC system, which could cost you between $1,500 and $12,500 depending on the model, according to HomeAdvisor. A new roof, on average, costs more than $8,000.

“What meets the eye at the surface may seem great,” says Raven Reed, a realtor with Realty Executives Select Group Ohio. “Once you get down to the nitty gritty, though, things could change drastically. That means defects could potentially cost you thousands — if not tens of thousands — of dollars later on.”

San Diego Realtor Danielle Balestra with Team Kolker says waiving a home inspection is a move she’s only seen in rare circumstances and when the buyer knows more about the house than typical buyers would. In these scenarios, it could be that the buyer’s agent knows the seller or has access to the recent inspection, she explains. Or, perhaps everything was recently remodeled with warranties that are still valid.

Alternatives To Waiving a Property Inspection

So why exactly would you waive a property inspection? If a seller is motivated to sell quickly, and two offers come in that are nearly identical but one of the bidders is willing to waive the inspection, that offer is seen as an easier one that could help move the sale along quicker.

While realtors strongly recommend getting an inspection before closing on a home, you could, as an alternative, bring a trusted advisor (maybe someone who is in the construction business) to tour the home with you so that you have a snapshot of the home’s condition before offering to waive the inspection. This advisor, Schwartz says, would be familiar with foundations, roofs, siding, windows, heating and cooling systems, and be able to recognize signs of mold and asbestos.

“Bring your trusted advisor, and if you as a consumer feel confident that you can waive based on their inspection, then go for it,” Schwartz says.

She would still require her clients to sign an affidavit that they’re waiving the inspection as it’s not something she recommends; after all, even an advisor can’t see, say, an underground septic system.

Couple celebrates closing on a new home
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Another strategy is to waive the inspection contingency (meaning you won’t try to renegotiate) but still get an inspection for your own knowledge, says Betsy Ronel, a real estate agent with Compass in Westchester County in New York. You’ll want to consult with your agent and possibly a real estate attorney, but in most cases you can still exit the deal if something major came up in the inspection.

The bottom line? Unless you have a huge stack of cash set aside for home maintenance and repairs, it’s not advised to skip out on the home inspection — even if it could help tip the bid to your favor on a dream home.