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It’s incredible how local buyers never request a home inspection before closing a property purchase. When investing a lot of money in a property, 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 property. Should you just 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 know 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 property buyers here don’t realize they have the option to request an inspection by a home inspector, especially when they purchase an FSBO. This is 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, especially if they only work with Ticos. Although it’s essential to know 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 great 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 give the BUYER the option 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 anything can be wrong with it. Do you want to discover the problems when it’s too late, or is it smart 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 should only be done on the townhouse’s interior or apartment. 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. 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.
Why inspections fail
Everybody has had leaking toilets, a leaking roof, leaking gutters, a broken fence, and lamps that don’t work. 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 in it which nobody noticed that before putting in the faucets? Or maybe the property is not draining correctly and is losing square footage with 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 really want to concentrate on some of the larger issues that cost a lot of money. We always include roof replacement, retainer wall problems, and septic problems as standard problems that allow you to walk or renegotiate, but there are others. If necessary, ask your realtor for another visit of the property, so you can make a list of what you’d want the inspector to pay attention to.
Can you make the purchase subject to 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 not only need the expertise of a well seasoned real estate agent, but also 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 with septic, retainer walls, roof, and electrical problems as those are the things that are more costly to get them fixed.
Why save money on a home inspection?
There are so many things that can be wrong with a property and many buyers are not aware of them 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 property, the location and the type of home inspection report you are looking for.
Banks now do home inspections
Recently, I had a buyer get a mortgage with BAC San Jose. The appraiser turned out to be also a home inspector. They had the seller fix some electrical problems and even have an exterminator fumigate the property and send in a report to show the property was free of termites. So, if you plan to get bank financing for your purchase, you can probably count on a mandatory home inspection too.
Have any more questions about home inspections? Then read this article I wrote for the Tico Times a while ago. I certainly hope you will request a home inspection before closing on a property here, just to save your self from problems later on.
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