Matt Driscoll

Matt Driscoll: ‘It makes my stomach cringe.’ Don’t waive your home inspection, real estate agents warn

It’s all good, until it goes bad.

That’s how one local real estate agent described the advice he gives to would-be home buyers who may be contemplating waiving a home inspection when putting in an offer in Tacoma’s super-charged market.

As off-the-wall as that sounds to anyone who’s received the standard education in home buying — always, always get a home inspection! — area real estate agents say that, more and more, the old rules are being thrown by the wayside.

“It makes my stomach cringe,” said Jennica Holmquist, a real estate agent with Keller Williams, when asked about what many have now described to me as an unmistakable trend: waving of home inspections by those desperately trying to score a house.

“It’s definitely become a thing,” she said.

As buyers compete in a housing market that lacks inventory, real estate agents say it forces people into bidding wars. As those bidding wars become more competitive, it’s only natural for house-hunters to look for a leg up any way they can get one.

When it comes to home inspections, this is playing out in two ways, real estate agents say.

For buyers hoping to make their offers rise to the top, waiving a standard home inspection — something unheard of in this area as recently as last year — can sometimes do just that. While none of the local real estate agents I spoke to advises using this tactic, many confirm it is happening.

Other buyers are relying on what’s known as a “pre-inspection.” According to local Windermere real estate agent Matt Hume, a pre-inspection is when a home inspector is allowed to do a lesser, largely “systems-based” assessment of the property prior to an offer being submitted. If done well, a pre-inspection will likely catch the big things, he says, but won’t go as far as to “test every outlet in the house.”

Why are these offers attractive to sellers? Typically, an offer that’s contingent on a professional home inspection allows an out for buyers if they discover something wrong with the home, or provides leverage in negotiations to knock a few thousand dollars off the sale price.

So, for sellers, the appeal of an offer that’s not contingent on a home inspection is fairly straightforward. It speeds up the process and removes a potential pitfall.

That said, it’s not risk-free. For instance, if a buyer discovers a major problem after moving in, even if their offer was not contingent on a home inspection, they may still try to sue. And if you’ve got a bunch of home inspectors traipsing through your house before you’re under contract, and something goes wrong, it’s difficult to know whom to hold responsible.

For buyers, both practices come with risks.

“There’s just so many things that can go wrong,” said Karla Wagner, a broker with John L. Scott in Lake Tapps. “What if it’s (a problem that costs) $10,000? What if it’s whatever, and then you don’t have a way out? You don’t need to force anything, or be risky, and then end up with a huge problem on your hand and a money pit.”

“I personally think it’s too risky,” she says of waiving a home inspection altogether.

Holmquist said there’s been a noticeable uptick in the number of pre-inspection and home inspections being waived over the past year. This coincides, she believes, with the number of King County buyers turning their attention to the South Sound market in hopes of finding a better deal.

Real estate agents around Seattle, she says, have been working in a market where waiving home inspections has been common for some time. That’s just not the case in Tacoma and Pierce County.

“We have so many agents who are coming down from King County,” she said. “Last year I didn’t really prep my buyers on (pre-inspections or waiving home inspections), but we’ve had to completely change our buyer consultation. I think that it’s going to become the standard.”

“I was hoping Pierce County could kind of stick together and not allow that to happen.”

Hume is less critical of pre-inspections. In fact, he endorses them — when they’re done right. He says he started using them in the housing boom years of 2005 and 2006, and — if done smartly — he says it can pay dividends for buyers and sellers in today’s market.

Hume says he’s been on “roughly 400 to 500 home inspections” and, in his opinion, “a buyer should never, ever waive a home inspection without first performing a thorough pre-inspection, sewer scope and any other inspections the home inspector recommends.

“This protects the buyer, seller and agents from lawsuits down the road, should a buyer move in and find monkeys in the crawl space or something just as crazy.”

But, Hume warns, “A pre-inspection in this market is an advantage, but no guarantee of success.”

And the cost can add up. Holmquist relayed a story of a friend who paid for eight pre-inspections — which can cost $200 to $400 — before landing a house. In Pierce County, she warns, “we just don’t have that kind of income down here.”

Still, as we embark on peak house-hunting season, she expects things to escalate.

“It’s game on now,” Holmquist says of these trends.

“And it’s crazy.”