As interest rates continue to drop to historical 50-year lows, house hunting is getting more enticing and difficult for buyers. And unfortunately for homebuyers, it’s a seller’s market: many houses are undergoing bidding wars, and buyers are having to get creative with their offers. 

But your offer shouldn’t come at the cost of a valuable home inspection — a trend that buyers seem to be following to make their offers more desirable. According to Redfin, 19.9% of buyers waived the inspection contingency during June 2020, up from 13.2% in June 2019. 

Risk of skipping a home inspection

To better understand the risk of skipping a home inspection, you should calculate whether you could afford to repair or replace any and all damages that you may uncover yourself. Repairs can add up quickly, and a new house often won’t yet have enough equity built up for you to take out a home equity loan or line or credit — a common financial solution for renovations and home improvement.

1. To uncover safety concerns.

Home inspectors thoroughly examine homes, testing and inspecting the things you can and can’t see, like radon, mold or carbon monoxide leaks. Mold removal can cost anywhere from $500 for small areas to $30,000 for significant whole-house damage that can also leave you without a home during the remediation process. 

Not only are these types of issues costly to repair, but they can also be life threatening to those living in the house. 

2. To reveal expensive pest projects. 

Not every home inspection includes checking for pests and insects, so double-check that it is before the day of your inspection. Pests and insects are another silent concern that can go unnoticed initially but be causing severe damage to the house behind the walls. Termites alone damage 600,000 houses annually. 

3. To pinpoint structural issues. 

Inspectors check the foundation, exterior of the house and other structural elements to assure all are in working order and that none  show signs of significant damage or issues. Structural problems, especially, can cost a great deal to repair or present safety concerns later on as the home continues to age, and these elements deteriorate. 

4. To create a plan for future expenses. 

Buying a home comes with plenty of new responsibilities, including maintaining the house and appliances. A home inspection report will include a review of the roof, HVAC system, electric, plumbing and even some appliances. Inspectors can often estimate the remaining lifespan of major units so you can plan for future expenses accordingly. 

5. In case you need to back out of buying the home. 

You may not feel comfortable going through with your purchase after reviewing the home inspection results. Including a home inspection clause in your offer gives you the option to back out of the deal without losing any money in the process. 

6. To save money on repair expenses. 

Following the inspection, you can request that the seller addresses any issues before finalizing the purchase . If the seller doesn’t want to make the repairs, you can back out of the offer or ask them to lower the sale price to account for the cost to make those repairs yourself. Either way, this saves you money on immediate repairs. 

Other helpful tips for homebuyers

With 46% of Americans considering moving into a new home in the next year, it is vital that buyers don’t jump into the first house they see. A home is the biggest purchase most people will make, and research should be part of the process. Here are three additional tips to consider.

Research mortgage lenders. Not all lenders offer the same loan types or interest rates. Make sure you shop around to choose a reputable lender. 

Buy owner’s title insurance. Don’t forego buying title insurance to save a couple hundred dollars at settlement. Owner’s title insurance protects you the entire time you live in the home from property title disputes that can cost thousands to defend in court. 

In some cases, it’s OK to skip the home inspection. Home inspections are almost always a good idea. The only time it may be OK to skip an inspection is if you are buying a brand new construction that is covered under the builder’s home warranty. However, before skipping the inspection, discuss the pros and cons with your real estate agent.  

The house hunt can be an overwhelming process, and a seller’s market might tempt you to forego certain contingencies — like a home inspection — to make your offer more appealing. But waiving the inspection can be costly if you run into unexpected issues shortly after closing on your new home. 

Keep the above reasons in mind if you’re considering skipping the home inspection, and always be sure to have a financial cushion in the event of any unexpected expenses.