Tips for Hiring a Home Inspector

Congratulations on your offer being accepted! In many cases, you may have a provision in your sales contract for a satisfactory home inspection.  You're one step closer to owning your dream home. Now is the time to choose a home inspector to take a closer look at the property.

Inspectors are thorough and in some states are required to be licensed. They have extensive training and follow strict rules to inspect the home's structure, electrical systems, AC and heating, plumbing, appliances, and many other aspects.

Inspectors find things you might not be familiar with or have overlooked. Even in brand-new construction, inspectors will find issues. This way, you know about the problems and can determine how to deal with them.

Inspections help you make decisions. If the inspection uncovers big surprises, you may want to ask the seller to make repairs or lower the sales price. You may also decide to walk away from the transaction.

It's better to know about problems before you close the sale on a home. No one likes it when an inspector finds deficiencies, but it's better to know about them upfront than to find out later. An inspection can help you avoid surprises down the road and make an informed decision about your purchase.

Your agent can recommend a qualified inspector and answer questions you may have about the process and what to expect. Another alternative is to ask friends who have purchased a home recently about the inspector they used and any suggestions they might have.

Some additional tips for hiring a home inspector:

• Make sure the inspector is licensed, if required, and insured.  Ask if they belong to any professional organizations.
• Ask the inspector about their experience and what they will be inspecting, as well as the type of report you will be receiving from them and whether it includes pictures of items in question.
• Ask if you can be present for the inspection so you can ask questions and watch the process to better understand.

By following these tips, you can hire a qualified home inspector who will help you make a wise decision about your purchase and protect you from unforeseen surprises.

Use Ben's Balance Sheet to Decide

There is a technique that has been attributed to Benjamin Franklin and used when faced with a decision.  As the lore goes, whenever Ben was faced with a decision, like you are now, he'd take a piece of paper, draw a line down the middle of it.  On the left side, he'd list all the reasons he should do something and on the right side, he'd list the reasons to avoid doing that thing.

Would-be home buyers are faced with the decision of whether to buy in today's market with uncertainty about inflation, the presidential election, the economy, higher than recent mortgage rates, and increased home prices, just to mention a few.

Some people have been put on the sidelines because they cannot qualify for a mortgage and others have sidelined themselves, even though they have the funds and resources, because of all the "noise" in the market.  Looking at the advantages of renting versus buying may bring clarity.

Advantages of Renting:

• Financial Flexibility: Renting typically requires a lower upfront cost, making it more accessible for individuals with limited savings or those looking to manage their finances conservatively.
• Maintenance Responsibility: Renters are often not responsible for major maintenance and repair costs, as these are typically the landlord's responsibility, allowing for a more worry-free living experience.
• Mobility: Renting provides greater flexibility to relocate quickly if job opportunities or personal circumstances change without the commitment of selling a property.
• Amenities and Services: Many rental apartments offer on-site amenities such as gyms, pools, and concierge services, providing added convenience and luxury without ownership responsibilities.
• Predictable Costs: Renters usually have fixed monthly costs for rent, making budgeting more straightforward as they don't need to account for unexpected homeownership expenses.

Advantages of Buying:

• Equity Building: Homeownership allows you to build equity over time as you pay down your mortgage, which can serve as a valuable asset and investment for the future.
• Stability and Control: Owning a home provides stability and control over your living environment, allowing you to personalize and renovate the property to your liking.
• Tax Benefits: Homeowners may benefit from tax deductions on mortgage interest and property taxes, potentially reducing their overall tax liability.
• Long-Term Investment: Real estate has historically appreciated in value over the long term, potentially leading to significant wealth accumulation.
• Sense of Ownership: Owning a home often brings a sense of pride and accomplishment, as well as the freedom to make decisions about the property without seeking landlord approval.

The Ben Franklin balance sheet might suggest that whichever side had the greatest number of reasons, that would be the appropriate action.  If each item had the same weight of importance that might be logical.  However, some reasons might tip the scale dramatically in favor of taking a particular action.

The equity building aspect of homeownership is exactly that type of reason.  With each payment made on the mortgage, a portion of it reduces the principal balance due which builds equity in the home.  Each month, a larger amount goes to the principal.

Homes on a national basis have experienced a 5.56% annual appreciation over the last 60 years according to the Federal Reserve Economic Data and Bureau of Labor Statistics.  During that period, inflation has averaged 3.7%, making homeownership a hedge against inflation.  Even if a person continues to rent, they will be paying more because rents have increased during the same 60-year period at 3.88% annually.

The average price of a home in America in 1963 was $19,300 and in 2023, 60 years later, the average price of a home was $495,100.  Long term, a home is a powerful investment in an individual's wealth.

For more information, download our information guide Homeownership Today and run a Rent vs. Own for your particular situation.