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Home Inspection: Negotiating Repairs

By June 30, 2019February 22nd, 2021Judi's Blog
Home Inspection - How to Negotiate Repairs | The Judi Wright Team | Best Frisco Realtor

Part II: What buyers and sellers want to know about options for negotiating repairs


For those buying or selling a home in the Frisco, Plano, Carrollton, McKinney, Allen or Prosper area, a home inspection is a vital part of the process. Read Part I of this series to get more information about common questions and answers about home inspections. And, learn what the home inspection checklist includes.


If you’ve already made it through the process, or just wondering what happens next, keep reading for helpful tips for home buyers and sellers after completing the home inspection.


After the Home Inspection – What’s next?

Most home inspections will result in dozens and dozens of items listed on the report. This list doesn’t mean you need to fix everything. It’s up to the seller and buyer to determine what happens next. And this is where the negotiation comes in to play.


Several things could happen during this negotiation process. And these vary depending on many factors including the experience and negotiating prowess of the real estate agents, the commitment of the buyer and seller to the deal, and even the market conditions. For example, in a hot seller’s market, a seller may have many offers on the table and may not feel the need to repair any or all of the buyer’s requests.


Now is a great time to remind sellers and buyers alike that your professional real estate agent is your best asset during this time. The negotiation process happens throughout the entire real estate transaction. The expertise and experience of your agent could result in thousands of dollars back in your pocket.


What are the options for negotiating repairs after the home inspection?

Depending on the severity of the issues found during the inspection process, the buyer and seller have several options to resolve any home repair issues. These include:


Do nothing

There are many cases where the best course of action is nothing at all. Especially when the home inspection report doesn’t materialize any significant structural or safety issues.


While there might be dozens of small or cosmetic items reflected, buyers shouldn’t expect the home to be perfect. Houses get lived in – carpets get walked on, showers leak, and walls get scuffed. These are not the kinds of things that should cause extended discussions or delays in the close.


This may also be the best action when the transaction happens during a ‘sellers’ market, and the seller usually has multiple offers. If you are a buyer, consider if asking for allowances or repairs could risk losing the home.


Renegotiate the price or receive a credit towards closing costs

If the buyer still wants the home after the inspection process results in repairs needed, an option might be for the buyer to re-negotiate the price by asking for repair allowances. In this case, the buyer would provide written estimates from qualified professionals for the cost of the needed repairs. Or, ask for a fair amount of money to cover the repairs.


The buyer, seller, and their respective real estate agents negotiate fair and reasonable allowances from the accepted sale price. The buyer would then complete these repairs on their own using the repair allowance.


Agree on a list of repairs to be completed by the seller

For major structural, mechanical, or safety issues that were unknown by the buyer or seller before the inspection, the prospective buyer has the right to request these items be repaired by the seller. In this situation, it’s essential to be specific about how and when to complete the repairs, as well as what documentation you need for proof.


Once this repair request is received, it is up to the seller to decide if they will complete all or part of the list. Don’t be alarmed if this list negotiation goes through numerous rounds of back and forth. Multiple iterations are standard at this stage.


Walk away

If either the buyer or seller cannot settle the repair negotiations in one of the three ways listed above, the last option is to choose to cancel the purchase agreement. Walking away is only an option if you have an option period specified in your contract.  Every state is different.  In Texas, an option period is usually part of the real estate contract that allows for inspection and negotiation of repairs during this timeframe.


Walking away is a last-resort option because no one wants to leave empty-handed after all that effort. But sometimes the issues may be more substantial than the buyer or seller bargained for when starting the process.


Just be sure you know what your contract allows you to do as not all will allow this. And that you have a skilled professional agent guiding you during this time.


Successful negotiation means everyone wins

Keep in mind that your real estate deal is unique. Rely on the expertise of your real estate agent to provide reliable counsel on your options. Because of their experience, they will have a much better understanding of what repairs are needed, as well as the level of negotiating power you have.


Don’t be afraid to ask plenty of questions. And it’s perfectly ok (ideal even) to get creative in thinking about how to solve issues, so both parties get something they want. As an example, you might find the buyer is moving from an apartment and doesn’t have any patio furniture. The buyer may be willing to ‘barter’ some repairs in exchange for the seller leaving behind a few of their patio pieces. Everyone wins.


Buying or selling a home can be overwhelming. But, understanding the process and having the right real estate partner on your side can help ensure you meet your goals. If you are looking for more information on the home inspection process, give us a call at 469-634-0932 – we’d love to help!

About the Judi Wright Team

Judi Wright/The Judi Wright Team is a real estate group specializing in the suburbs of Frisco, Plano, and surrounding areas. Named the “Best Realtor in Dallas,” by D Magazine thirteen times and a Five Star Realtor with Texas Monthly eight times. Judi is also a Company-Wide Top Performer with Ebby Halliday, a Berkshire Hathaway affiliate.

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