Before we jump into the “Red Flags” in a home inspection report for buyers, it is important to put things into perspective.
Inspection reports are never free of problems.
Sellers do not fix every issue that is identified in an inspection report.
Home inspection is not intended to just make you say either yes or no, it rather is an aid in the decision making process, negotiate the price or discuss repairs with the seller.
Having said that, let us now discuss the deficiencies that could potentially be deal breakers and you as a home buyer should be most concerned about.
Structural Damage
A serious problem because it affects the integrity of the house. Windstorms, floods, water leaks or movement of heavy vehicles around the house usually cause structural damage. Definitely a red flag. The cost of repair for structural damage could be anywhere from $5,000 to $50,000 depending upon area and severity of the damage.
Faulty Foundation
Faulty foundation is a result of low quality construction work. It happens when the soil is not compacted properly before laying the foundation. As a result the foundation is weak and becomes prone to water damage. Common signs of a faulty Foundation are cracks in the interior and/or exterior walls, cracks on the floor, windows and doors become difficult to open and close and an unlevel floor.
A faulty Foundation is a major problem fixing which easily costs tens of thousands of dollars.
When an inspection report identifies a faulty foundation It is a big red flag you should either walk away from this deal or take a second opinion from a structural engineer.
Water Damage & Moisture
Moisture can be present in various locations in the house, such as, basement, the attic, behind walls and the roof. Plumbing leaks, roofing problems or poor drainage can cause moisture and water damage to a house. Water damages lead to compromised structural integrity, safety issues and mold formation. A skilled inspector will be able to detect the real reason behind the damage and also the severity of it.
If there was a moisture issue but it has been fixed, generally, it is ok and this is why home inspection is important because a skilled inspector can tell you the extent of the problem.
Mold
Mold of any level discovered in a home inspection is cause for a serious concern. Not only mold causes structural and material damage to a house it has serious health effects, such as, respiratory illness, asthma attacks, cough and irritation in eyes, skin are the most common.
Mold can be cured but if the infestation has gone inside the walls then it can easily cost several thousands of dollars. There always is a possibility of molds returning. Steering clear of a mold infested house is probably a good idea.
Remember, a regular home inspector may not always be certain of the presence of mold, they suspect the presence and advise you to have a mold specialist test and confirm whether or not mold is actually present. It, of course, means an added cost but it is worth it.
Pest infestation
Pest infestation, especially termites, is surely a potential deal-breaker. If the pest infestation is not treated early enough those wood eating pests can cause severe structural damage. The damage termites cause depends upon how long they have been active. An experienced inspector can easily identify an infested house or the house that has the potential for growth of termites.
Heating and cooling system
When a home inspection report identifies problems in the heating and cooling system. This is an expense ranging from $5000 to $10,000. The lifespan of heating and cooling systems is about 10 years. If these systems are reaching the average life expectancy you can negotiate a deal with the seller.
Electrical & Plumbing Systems
These two are completely different systems but what is common in both is that they run behind the walls.
Common electrical problems discovered during a home inspection are not as expensive as some of the other issues we have discussed, unless the entire house has to be rewired. Which is only required in extreme cases and can cost around $20,000 for an average sized house.
Electrical faults are cause for concern because of the safety threat they pose. A home inspector will examine Service panels, GFCI circuits, electric outlets, switches & fixtures, and the type of wiring etc.
On the plumbing side the inspector is going to inspect if everything is running as they should be and if there are any leaks etc.
Based on their findings the inspectors usually recommend contacting a licensed electrician or a licensed plumber to further evaluate the extent of the issues.
Conclusion
A home inspection will almost always reveal some problems. Not every problem identified is a deal breaker. You, as a buyer, should be concerned about the big ticket items or the issues that can have health and safety concerns. Having a home inspection done helps you to make a decision whether to negotiate the price, have the problems fixed by the seller or call off the deal.
For further reading we recommend the article “how to negotiate after a home inspection” to learn how to get the best deal.
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