Why Skipping a Home Inspection Could Be an 'Enormous Financial Mistake'

There are a lot of steps to take when buying a home. But one of the more important ones? That’d be getting a home inspection done.

While it isn’t outright required (legally speaking, at least), real estate agents say getting a professional inspection is an absolute must to add to your checklist when buying a new home — and for many reasons.

Are you preparing to buy a home this year? Here’s what an inspection entails and why real estate professionals say you shouldn’t skip one.

What’s an inspection?

An inspection is a professional, third-party evaluation of a home and its condition. As Douglas Wagner, director of brokerage services at BOND New York Real Estate, explains, “home inspectors are trained to see objectively what a buyer might not see subjectively. They look at the physical construction and the mechanical systems of a home for any damage, imperfections or potential failure that a buyer might not know to identify or anticipate.”

A home inspection typically covers the following areas of a home, according to the Texas Professional Real Estate Inspectors Association:

• Structure
• Exterior
• Roofing system
• Plumbing system
• Electrical system
• Heating system
• Air conditioning system
• Interior
• Insulation and ventilation
• Fireplaces

Once an inspector is done evaluating a property, they will give the buyer a full report detailing their findings. You can then use this to inform your next steps in the transaction (more on this later).

The cost of an inspection

Home inspections aren’t free. If you want one, you’ll need to pay for it. The cost will vary based on the size of the home, where you’re located, and the inspection company you choose. The average cost is $343, according to home services platform Angi. You’ll pay this fee at closing.

Why a property inspection is essential

The primary goal of an inspection is to provide you, the buyer, with information about the condition of the property you’re considering buying. But that’s not where its value stops.

Inspections can also prove to be valuable negotiating tools and could save you time, money and hassle on repairs in the future. Here are just a few things an inspection can offer you as a homebuyer.

Identify any issues

You’ll tour a home before submitting an offer — maybe even several times. But an inspector is going to get much more detailed when going through the property. They’re going to look at the condition of its roof and foundation, test every appliance and system, run every faucet and make note of every little thing that could potentially be awry in the home.

“You need to know what you’re getting into, because once you buy it, any issues or problems become yours,” says Melissa Leifer, a licensed real estate salesperson at Keller Williams NYC. “Many times owners may not know of issues in the home. They may have thought they solved a problem in the home only to find out during an inspection that it wasn't fixed.”

Negotiate/estimate repairs

You can also use the inspection to pinpoint any repairs that need to be done around the home. Then, you can estimate what those will cost (and determine if it’s still worth going through with the deal), or negotiate with the seller to make those repairs before closing.

“Home inspections can save buyers big money if larger problems are revealed, or they might also save them a few dollars at the closing table for minor, punch-list types of issues that have not been corrected,” Wagner says. “Most importantly, a home inspection can give buyers the information they need to avoid making an enormous financial mistake by purchasing a house that is fraught with invisible defects.”

If that last bit does happen — and the home inspection reveals major issues, you may be able to pull out of the deal entirely. (It depends on your contract, though. Talk to your agent if this is something you’re considering).

Alternatively, in some states. you may also be able legally to hold the previous owner responsible for the cost of repairing problems turned up by the inspection. However, even in jurisdictions that have such laws, in order to collect, you generally must show that the seller knew about the issues and did not disclose them.

Confirm the home's value

Finally, you can also use the home inspection to ensure the home you’re purchasing is worth what you’ve offered for it. While the appraisal — something your lender will order — is what will officially determine the home’s market value, the inspection can give you an idea of whether repairs or problems exist that can eat into a home’s value or future marketability.

You may even be able to use the inspection report to negotiate a lower price with the seller if there are lurking issues that could affect the property’s value down the line.

“Inspectors pay special attention to the walls, the roof, the floors and how the property is situated on its grounds,” Wagner says. “They can predict potential flooding, mechanical failures or subpar electrical or plumbing installations.”

Risks of skipping an inspection

Forgoing an inspection might save you a few hundred bucks off the top, but agents say the move is risky — and likely not worth it.

“Skipping an inspection is one of the most dangerous things a buyer can do,” says John Manning with RE/MAX Gateway–On Market.

Not only can failing to do an inspection keep you from learning about lurking issues that may exist in the home, but it could leave you on the hook for expensive repairs not long down the road.

“You could discover a massive issue that could cost hundreds of thousands of dollars to fix,” Leifer says. “The foundation could be shot, in which case the whole house may have to come down.”

There could also be health hazards.

“The house could have an issue that makes it uninhabitable,” Leifer says, “You could have mold, asbestos, massive leaks. The list goes on and on.”

Do you need an inspection on a brand-new home?

Real estate pros say you should get an inspection done on any property — even ones in which you are its first occupant.

“New construction is often of lower quality than older homes, even if the finishes are newer and more fashionable,” Manning says. “An acute shortage of skilled labor coupled with an over-abundance of unskilled workers in construction has significantly lowered new construction quality and buyers should take nothing for granted.”

If you’re having a home built from the ground up, you can even have what’s called a phase inspection done. This is when an inspector conducts several inspections over the course of the building process, ensuring construction is being done properly at every phase along the way.

“When it comes to brand new construction, every builder has different standards for their own projects,” says Curtis J. Wright, a broker associate with The Wright Group at Christie’s International Real Estate Group Montclair. “It’s important to bring in an expert who can identify any areas that may have been overlooked or possible shortcuts the builder took to finish the project.”