10 Red Flags That Can Cause a Home Inspection to Go Wrong


If you’re buying a brand new house or selling your property, the chances are you going to have to conduct a home inspection. This is an especially important process if you’re the one who’s buying in the arrangement, as you can make sure that you’re not going to be putting a significant investment into a property that’s going to leave you with some expensive problems in the not so distant future. 

Potential red flags that can arise during a property home inspection include evidence of water damage, structural defects, problems with the plumbing or electrical systems, as well as mold and pest infestations. The presence of one or more of these issues could be a dealbreaker for some buyers.

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If you’re buying a home, it may seem like forking out an extra $300-$500 home inspection fee is an expensive outlay just to get the house inspected, especially if you may not even purchase the home at the end of it. Yet, it may be the wisest money you’ll ever spend.

Before you sign on the dotted line, it’s recommended to get an expert to check the house for structural and safety issues that could end up costing you a pretty penny later down the line. Some of these problems can be fixed with a small amount of TLC; others render the home practically unlivable and require immediate repair if a serious issue is uncovered.

All home inspections are subjective and no two inspectors will write an inspection report with the same terminology. If you’ve had a home inspection and the results seem alarming to you, there are some questions you need to consider before making a final purchase decision.

  1. Is the deficiency a code violation? All existing homes likely have some building code violations. This is because building codes are updated every few years. Building code enforcement only applies to new building construction or renovation projects that exceed cosmetic improvements.
  2. Is this a structural deficiency? A structural deficiency typically refers to the failure of a building component. This can include wood rot or other damage to foundations, framing, or subflooring. It can also include a repair that is not done using good building practices.
  3. Is this a safety hazard? A safety hazard is any condition that could cause harm to you or other people. This can include uneven walking surfaces, electrical shock hazards, and missing smoke detectors. These safety hazard notes are not necessarily an indication a repair is needed. It’s more so a “for your information” statement to alert you that the condition exists. These are generally labeled as “Safety Concerns”, “Improvements”, “Recommended Items”, or some similar variation in your home inspection report.
  4. Is this a cosmetic concern? Cosmetic concerns are typically referred to as non-structural defects that are a matter of taste or age. Wall and ceiling cracks are common items that reported in error.
  5. Does this aging system require an update now? All systems in a home have a limited lifespan. In a home inspection, a home inspector will typically cite the age of the system and if it is working properly on the day of the inspection. No one can predict when a repair or replacement will become necessary. I’ve seen water heaters 30 years old still be in good working order and I’ve seen heat pumps fail in as little as 6 years.
  6. Is the home priced accordingly for the condition of the house? This will vary widely based on where you live. The real estate appraiser’s role is to establish market value based on what similar homes in size and age range have sold for.

In this article, we will look at nine red flags that can cause a home inspection to go wrong and tips on how you can spot these issues for yourself. Let’s jump into it.

Water Damage

leaking water heater

First thing’s first, let’s start with one of the most serious and financially damaging home inspection issues that there is – water damage. As you will see throughout this list, the majority of the issues we discuss will revolve around some form of water damage. 

When water gets into a home’s foundations and has no real way of draining out, it can cause a wide range of issues. Most of these problems are significant red flags when buying a property. For example, undrained water underneath the building will damage the foundations and cause your home to rest upon weak support. This could make the foundation completely unstable and subject to movements, which will have a knock-on effect throughout the home.

On top of that, dampness in the crawl space and water that fails to properly drain away from the foundation can cause mold and rot, further increasing your problems. It doesn’t take an expert technician to know that this is bad news. 

One of the main reasons why this is such a major red flag is because of the high cost of the repairs.

According to WaterDamageDefense.com, in 2013, water damage and mold cost the insurance industry $2.5 billion dollars per year.

According to InsuranceBusinessMag.com, in 2017, the total amount of insurance payouts for water damage was $13 billion. The average claim cost about $10,000.

According to HomeAdvisor.com, in 2020, The average homeowner spends between $1,142 and $4,732 to restore or repair water damage, with an average of $2,930.

Structural Issues

Issues that affect the structural integrity of a property should certainly send alarm bells ringing. Assessing the structural integrity of the property is by far the most crucial aspect of a home inspection. This determines the strength and potential longevity of the property, but it also assesses it’s safety for the inhabitants. 

Most residential buildings are made up of four structures. These are the foundations, walls, floors, and roofs. If one or more of these critical features are damaged, it would undoubtedly constitute a red flag on the home inspection. Here are some things to look out for when assessing the structural integrity of the home: 

  • Cracks in the walls
  • Uneven flooring
  • Windows and doors that don’t shut or fit properly
  • Issues with the foundations
  • Misaligned porch of front steps leading to the property
  • Gaps in the mortar and brickwork

If you notice any of these things around the residence, then you should point this out to the home inspector and potentially negotiate a repair with the owner. Of course, the severity of the problem and whether or not it pertains to a safety risk needs to be taken into consideration. 

If you are the seller in this scenario, it is highly advised that you get these problems repaired before listing the property on the market. Most general home inspectors are not qualified to comment on the structural integrity of the house. They can only identify and describe potential issues and then recommend a full structural home inspection to be carried out by a professional structural engineer.

Grading Around the Home

Old House

It’s vital to assess the grading of the landscape that surrounds the property. This is an often overlooked aspect of home inspections, but ignore it at your own peril. The gradient plays a significant role in how water drains around your home, especially during floods or storms. If the gradient slopes towards the building; this is referred to as a negative gradient and is a huge red flag during a home inspection. 

It’s really quite simple, water needs to flow away from the home. It causes groundwater to pool around the home, and this water usually gets trapped in the basement and around the foundations. This is not good news. The longer this groundwater stays in contact with the foundations, the higher the likelihood that they will start to erode and break down. 

Furthermore, excess water near the foundation walls of your property can loosen the surrounding soil which could lead to the house settling and the foundations shifting. When the foundations shift, this has a knock-on effect causing substantial structural issues throughout the rest of the house.

Roofing Issues

If you’re contemplating buying a new home, it’s imperative that you take some time to inspect the roof. It’s one of the most important factors in protecting your home from weather conditions, water damage, heat loss, and it also denies pests and easy entry into the house. 

Checking to see the structural integrity and strength of a roof is not something that can be done quickly from the outside, which is why it’s massively important to get a thorough and proper inspection. A roof that is falling apart may look just fine from the outside, but once you get into the attic, things can start to look a little different. 

Here are some things to watch out for when appraising the condition of a roof: 

  • Dark streaks or water stains on the roof. This is often a sign that the roof covering surface is wearing out.
  • Sagging roof. This can also indicate a foundation problem.
  • Leaks. A leaking roof can be like an onion. Layers of problems can arise including concealed damage inside attics and walls.
  • Problems with the gutters and drainage system. Gutters are often the one area of roof maintenance that is often overlooked. Cleaning gutters is a tedious and messy task. However, when gutters are clogged and water can’t drain properly, they will overflow and can rot out the eaves and roof sheathing.
  • Cracked or curling shingles. As shingles age, they literally bake in the direct sunlight. As the materials dry out, they will shrink causing the shingles to crack along ridges and valleys. The edges can also curl, allowing water to seep behind the shingles. Older shingles are particularly susceptible to damage caused by wind and hail.

Ideally, your home inspectors should give you a rough estimate of how many good years the roof has left after they have assessed it. A general rule of thumb is that roofs generally have a lifespan between 20 to 30 years, depending on the roofing material may be longer.

If you’re buying a home, it is usually better to buy an older house with a new roof than purchasing a new home that has obvious roofing issues. This is primarily because roofing repairs are some of the most expensive repairs you can conduct.

According to RoofingCalc.com, a roof replacement can run $5000 on the low side to $15,000 on the high side. Some roof replacements can be much more depending on the complexity of the roof configuration.

According to HomeAdvisor.com, in 2020, the average homeowner spends about $8,041 to install a new roof, and most spend within a range of $5,346 and $10,817.

Mold

Issues with mold usually come hand in hand with water damage. In extreme cases, mold removal can cost upwards of $10,000, which is why any hint of mold should be considered a major red flag in a home inspection. 

More often than not, mold is an indication that the building is falling into a state of neglect. Not only does it smell rather bad, but it’s unhealthy to inhale harmful types of mold spores. If it’s left unchecked it can lead to a variety of discernible health conditions ranging from skin irritation to serious respiratory problems. 

Sometimes, the build-up of mold could simply be down to a lack of cleaning and which be remedied in an afternoons’ work. However, if the mold was caused by a lack of ventilation, an unrepaired leak, or any other form of water damage, this typically indicates something more serious.

Mold remediation often involves removing and discarding the affected materials, such as drywall, wood trim, carpeting, etc.

According to HouseLogic.com, You can expect to spend $200 to $600 for a site visit from a qualified mold inspector, which will take 2 to 5 hours.

According to HomeAdvisor.com, in 2020, the average cost for mold remediation is $2,221. Typical budgets range between $1,116 and $3,337 or $10 to $25 per square foot. Removal projects under 10 square feet cost as little as $50. Larger jobs may cost upwards of $6,000.

Most home inspectors are also certified to perform mold inspections. However, not all are. A home inspector is not required under the Standards of Practice to document environmental concerns like mold.

Specialized training is required to perform a mold inspection. A home inspector who is not trained in mold inspecting should refer to any questionable findings to a qualified mold inspector.

Wood Destroying Organisms

The most common wood-destroying organism is termites, however, there are others. As most people know, it’s tough to keep your home completely pest free, especially during the summer. Yet, you won’t need a professional home inspector to tell you that a pest infestation is a terrible news.

The severity of the predicament largely depends on what kind of pests are dealing with it and how far along the infestation has gotten.

In general, wood-destroying organisms such as beetles, carpenter ants, and termites can be devastating to a home’s structural systems. If they are left unchecked for an extended period of time, they cause irreparable damage to the beams, walls, flooring, and foundation. 

One of the worst types of pest to look out for are termites. This is where a professional termite inspection comes into play. These tiny insects are responsible for a reported 5 billion dollars worth of damage to US property each year, mainly due to the fact that they attack the critical support structures in the house. 

Another major red flag that will often be a dealbreaker for most home buyers since lenders will often not lend money on a house with an active infestation.

Here are the main signs that you’re dealing with a wood-destroying organism infestation in the house:

  • Evidence of nesting, mud tubes, and other remnants of activity.
  • Physical damage to structures in your home (mainly wooden structures) 

According to Orkin.com, termites and similar pests cause an estimated $30 billion in damage to crops and man-made structures in the USA alone. A homeowner who discovers termite damage will spend an average of $3,000 to repair the damage.

According to HomeAdvisor.com, in 2020, a termite treatment costs between $220 and $908, or $561 on average. Cost depends largely on the size of the home and location. 

Plumbing Issues

old house plumbing

Issues with plumbing is a significant red flag during the home examination. As mentioned a few times already, water damage is a homeowner’s worst enemy and faulty plumbing systems are one of the prime suspects for leaks. 

The majority of the pipework is located underneath the floorboards, making them notoriously difficult to repair. In addition to this, problems can go unnoticed for a long time, usually until they create a series of cross-connection issues or structural damage to the walls, flooring, and foundations. 

Some issues can easily be repaired and could be a trivial concern that should be negotiated with the homeowner. That being said, if all of the toilets, sinks, and pipes aren’t working correctly, this indicates that the property is dealing with a larger scale problem. 

Here are some telltale signs that you’re dealing with problematic plumbing system: 

  • Constantly dripping or leaking faucets 
  • Moldy smell throughout the house 
  • Low water pressure
  • Poor drainage 
  • Evidence of leaks
  • Abnormally high water pressure 
  • Sediment build-up 
  • Rust 

Some of these issues will require a plumber to repair and could cost upwards of $10,000 depending on the severity of the problem.

According to HomeAdvisor.com, in 2020, small plumbing jobs cost between $353 and $1,836 with an average of $1,076. Repiping an entire home will run anywhere from $1,500 to $15,000 or more. Obviously, the cost will depend on your area and how much piping has to be replaced.

Aging Electrical Systems

2-prong-outlet

Similarly to the plumbing issues listed above, having a faulty electrical system in the house can be extremely expensive to repair. These issues are notoriously hard to rectify, as wiring systems are often sophisticated and poorly organized. 

What’s more, faulty electrical systems are hazardous and present a genuine risk of fire. It is reported over 50000 home fires are started in the USA because of electrical issues. This is predominantly down to outdated and inadequate wiring that has failed to keep up with the modern-day safety standards. 

More often than not, homes that predate 1960 do not meet code, and the building’s entire electrical system will have to be refitted. This is a huge job and generally requires the upheaval of floors and the knocking down of walls. This can cost anywhere from $5,000 to upwards of $30,000 or more. 

Home inspectors will closely examine the electrical system to determine both overall conditions and defects. Nevertheless here are some issues that you can look out for yourself when choosing a property: 

  • Exposed wiring on the interior and exterior walls
  • Electrical panels smaller than 200amps
  • Multiple electrical panels
  • Flickering, buzzing, or dimming lights 
  • Two-prong outlets
  • Discoloration around the outlet points in the property

According to HomeGuide.com, the cost to update electrical home wiring ranges from $2,000 to $9,000 on average with most homeowners spending $2.65 per square foot. Electrical upgrades will vary based on the size of the house and the complexity of the project.

HVAC Problems

Your home HVAC system is essential for regulating the air temperature and controlling humidity in the atmosphere. These units require regular maintenance if they are to perform at their optimal level. During the home inspection, the assessor will usually take note of the electrical systems that lead up to HVAC systems, the ductwork that runs through the home, furnace faults, as well as the overall ventilation of the property. 

Inadequate ventilation can lead to mold and water damage problems, which, as you know, are two of the other red flags in our list. In addition to this, homeowners should be changing the system’s filters at least once every three months to keep the air quality as it should be. If they have failed to keep up with this regular maintenance then there is a chance that there are other issues throughout the home.

According to HomeAdvisor.com, in 2020, the cost to replace an HVAC system averages $7,000, with a typical range of $5,000 to $10,000. This is a per-system cost estimate. Some homes will require multiple systems. This estimate does not include ductwork replacement which averages about $2500 per system.

Common Home Inspection Red Flags and Their Repair Cost

Here is a list of the common home inspection red flags that we have listed above and the average cost of repair in the USA. These are average and could fluctuate largely based on the state you resided in and the complexity of the repair.

Home Inspection Red Flag Cost of Repair
Water damage repair $1,000 – $10,000+
Structure repairs $1,000 – $10,000+
Termite treatment $200 – $900
Electric system rewiring $2,000 – $9,000+
Installation of a new plumbing system $1,500 – $15,000
Mold removal $1,500 – $3,000
Roof replacement  $5,000 – $15,000+

 Summary

A home inspection is meant to highlight potential issues that the property may have, whether they are visible or not. These assessments sometimes call attention to red flags, such as water damage, mold, and faulty electric and plumbing systems.

Whether these red flags represent a home inspection deal breaker scenario for the home buyer largely depends on the inspectors’ report and the severity of the issue. For most of these problems listed in this article, the cost of repair is relatively high, which may require the seller to drop the asking price and enter into a negotiation with the purchaser. 

HomeInspectionInsider.com is owned and operated by Hubert Miles is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com. HomeInspectionInsider.com also participates in affiliate programs with other affiliate sites. Hubert Miles is compensated for referring traffic and business to these companies.

Hubert Miles

I've been conducting home inspections for 17 years. I'm a licensed Home Inspector, Certified Master Inspector (CMI), and FHA 203k Consultant. I started HomeInspectionInsider.com to help people better understand the home inspection process and answer questions about homeownership and home maintenance.

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