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Incredibly, local buyers often don’t request a home inspection before closing a property. When investing a lot of money in a home, why wouldn’t you spend an extra few bucks to ensure you’re not buying into a huge problem?
Imagine that you have found this excellent bargain property in Costa Rica. You’re sure you’re getting a great deal. And you are sure you’ll save lots of money buying this. Should you go ahead and buy it or look at it better by hiring some expert advice first? Of course, you know this guy who knows this guy who knows about construction. Should you ask that guy or hire a home inspector to do a home inspection before closing?
Is this the first property you have bought in this country? Do you speak Spanish? Do you know anything about how houses are built here? And do you understand how septic systems function? Are you an expert on electrical systems that don’t have grounding? Did you know that many parts of the country have bad soil that doesn’t drain well during the rainy season? Can you recognize the signs of flooding or dangerous cracks due to earthquakes? I can make a mile-long list of why you should order a home inspection before closing.
Many real estate buyers here don’t realize they can request an inspection by a home inspector, especially when they purchase an FSBO. That happens because they don’t know the customs, the country, the language, or the way of doing business. The seller is not going to tell you to hire a home inspector.
I know many real estate agents who never recommend a home inspection, primarily if they only work with Ticos. Although it’s essential to understand that a home inspection is not mandatory by law, that we don’t have title companies to monitor problems that might show, and that it’s normal to purchase “as is.”
Before you start shopping for a house, please take the following advice of an experienced real estate broker:
What I do
Because we don’t have the laws that protect a buyer, as they often do in other countries, there are a few things that I recommend you do.
A home inspection is excellent to learn if the property has serious problems, so you can cancel your offer or make a new one. When I write up an offer, I always include:
- BUYER is allowed a home inspection, paid for by the BUYER, within two weeks of the offer. Only structural damages, septic, drainage, or roof problems will allow the BUYER to default. BUYER will accept minor damages.
Why two weeks? Because you need two weeks to:
- Get the seller to approve the offer,
- Find a good home inspector,
- Get an appointment with a home inspector,
- Have the inspector do his inspection,
- Get the home inspector to write up the inspection report,
- Read the report and decide what you want to do, depending on the results.
Not until then do I ask the buyer’s lawyer to write up the option to purchase-sale agreement or letter of intent.
New homes fresh out of construction come with all kinds of problems, and older homes are no different. Your realtor probably never lived on the property for sale, so who knows if there’s anything wrong with it. Do you want to discover the problems when it’s too late, or is it wise to request a home inspection first?
If you hire a contractor to build your own home, I suggest you include a home inspection in each stage of the construction.
Condo inspections are quite different; the inspection must be done on the townhouse’s interior or apartment only. The reason is that the HOA & administration are responsible for maintaining the common areas and the exterior and roofs of the building(s).
The Cost and Who Pays?
What’s the cost of an inspection? That depends mainly on the size of the construction and what needs to be inspected. I’ve seen $400 for a home inspection in a 1,200 ft2 condo and $800 for one of the same size. Usually, the price difference depends on how detailed the home inspection and the report are, if images are included and if the inspector spends a lot of time commenting on the problems. Check with a home inspector how much he charges and a report sample before you request a home inspection.
Why inspections fail
Everybody has had leaking toilets, a leaking roof, leaking gutters, a broken fence, and lamps that don’t work. So why would the home you are buying be different? Why would you assume that the drains in the kitchen work properly or have a bag of cement that nobody noticed before putting in the faucets? Or maybe the property is not draining correctly and is losing square footage every rainy season? Or is the flashing between the roof and the gutters missing? Most of these details are easy and cheap to fix and seldomly are the reason for the failure of the home inspection.
You want to concentrate on some more significant issues that cost serious money. We always include roof replacement, retainer wall problems, and septic problems as common problems that allow you to walk or renegotiate, but there might be others. If necessary, ask your realtor for another visit to the house, so you can make a list of what you’d want the inspector to pay attention to.
Can you make the purchase subject to a home inspection?
Yes, you can make the purchase subject to home inspection, but you have to describe everything well in the offer to purchase. Especially if you’re a first-time buyer, you need a well-seasoned real estate agent’s expertise and a good home inspection report.
I always prefer to get the home inspection done and approved by both parties before the attorney writes up the option to purchase – sale agreement. Make sure you include septic, retainer walls, roof, and electrical problems, as those are the most common and more costly to fix.
Why save money on a home inspection?
Many buyers are unaware of many things wrong with a property until it is too late. Home inspectors cannot give repair estimates, but they can give you a list of the defects in the home. They are trained to find problems that may not be obvious to the untrained eye. And they can also let you know the seriousness of those items found during the inspection.
A good home inspector will charge you anywhere between $300 and $1,000 for a good home inspection, depending on the size of the house and the additional buildings, the location, and the type of home inspection report you are looking for.
Do banks do home inspections?
Most banks now also do a simple home inspection by the bank appraiser. In that case, it works like a title company: every problem has to be corrected before the loan is approved. I’ve seen a bank’s home inspection report with electrical issues and even one that ordered an exterminator to fumigate the property for termites first.
Have any more questions about home inspections? Then read this article I wrote for the Tico Times a while ago. I hope you will request a home inspection before closing on a property here, just to save yourself from problems later on.
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Used in featured image: Image by luis_molinero on Freepik