Home Inspection Deal Breakers That Can Kill a Home Purchase

home inspection

When a potential home buyer makes a purchase offer on a home, it’s often contingent on a home inspection. This can be an uncertain and often stressful few days as both parties await the home inspection results. Provided the home inspector doesn’t discover any deal breakers, the potential buyer will choose to move forward with the home purchase.

So what are some home inspection deal breakers which can kill your deal? Home inspection deal breakers are deficiencies discovered that alter the client’s decision to purchase a house. Examples include structural damage, roof damage, aging electrical, plumbing, and mechanical systems. Environmental issues such as lead-based paint, asbestos, and mold can also be a deal breaker.

The items listed in the home inspection report are relatively easy to negotiate most of the time. But occasionally, a significant issue may arise that neither the buyer nor the seller anticipated. These potential deal breakers may scare off the home buyer if the seller isn’t willing to address them.

So, let’s look at what potential deal breakers may be lurking inside your home. Some of these items may surprise you.

Significant Problems with the House Itself

Foundation Settlement Problems

Your home’s foundation is the most critical system in your house. If the foundation fails, nothing else really matters. Foundation problems caught early can be relatively easy to repair. However, a foundation repair that requires a structural engineer could cost thousands to tens of thousands of dollars to repair.

Foundation problems tend to arise because of poor drainage around the home’s perimeter or deterioration due to age. Minor foundation cracks are common; however, excessive step cracking and separation of masonry joists or a sagging floor or roof structure can be a sign of a major foundation problem.

Water Intrusion Problems

Water intrusion problems can be caused by underlying issues that aren’t easy to correct. Many water intrusion problems are caused by design flaws or improper lot grading.

For example, some older concrete slab houses were not constructed with proper grade clearances. Water intrusion problems arise when a heavy rain comes if stormwater runoff around the home has nowhere to drain.

Homes with basements are also vulnerable to water intrusion problems around basement windows and doors, exterior walls that were not adequately waterproofed, or the waterproofing has deteriorated due to age.

Extensive Termite Damage

Termites are common in many parts of the world. If caught early, termites can be treated by a pest control specialist with minimal structural damage. The problem arises when the signs of termite activity are not detected or ignored until it’s too late. Termites feed on wood, and under the right conditions, a termite infestation can provide undetected until it’s too late.

Home inspectors and pest control specialists stress that a home has a termite inspection annually and that an active termite bond is in place. A termite bond protects a home against termite activity and, in some cases, will even cover damages caused by termites if missed by the pest control company issuing the bond.

Roof Problems

Minor roof problems are often considered to be a simple repair. Minor repairs like loose or missing shingles, sealing around plumbing vent penetrations, and flashing repairs, if caught early, are relatively inexpensive repairs. However, if roofing problems are ignored, structural damage can result in damage to the roof sheathing, trusses, or ceiling joists.

A roof that is past its useful life can lead to significant problems. A full roof replacement can be costly and likely a cost most buyers don’t want to incur.

Electrical Problems

Most electrical issues are inexpensive to repair, while others could be potential deal-breakers. You can quickly fix some electrical problems such as GFCI repairs, double-tapped breakers, and open junction boxes for a few hundred dollars.

But, there are electrical issues that could cost upwards of $20,000 or more to correct depending on the house’s size. Old electrical wiring like knob and tube or aluminum wiring leads to cost because the work is labor-intensive and often requires tearing into walls to correct.

Outdated electrical panels, like Federal Pacific Stab-Lok breaker panels, are considered a fire hazard and need to be replaced because of their inherent fire hazard risk. Other costly electrical repairs include replacing old fuse boxes and replacing overhead electrical service or meter bases.

These repairs often disconnect power from the house and involve an inspection from a local building code inspector before you can restore service.

Plumbing Problems

Plumbing problems can cause considerable damage to a house and generally provide little to no warning. While you can not avoid some problems, old piping in a home can be a time bomb just waiting to explode. It’s one of those repairs that homeowners need to be proactive about rather than reactive.

Low water pressure can indicate a potentially serious problem, especially if the home has galvanized water piping. Galvanized water piping can also carry harmful contaminates for human consumption.

Additional piping concerns exist, including polybutylene (PB) supply pipes and ABS waste piping. PB piping can fail, suddenly causing significant water damage. Galvanized, rusted cast iron and ABS plastic waste piping are also prone to failure. Polybutylene and ABS piping are considered to be defective products that have been featured in lawsuits nationwide.

old house plumbing

Shallow Wells and Poor Water Quality

When buying a home that has a well, water quality is essential. Old wells tend to be shallow with low water quality. It’s critical to have a complete water analysis done on a well to verify the water is safe to drink.

Low water quality could lead to long-term health problems due to contaminated water. If the water from the cold water tap has a “rotten egg” smell, it’s a good indication of sulfur in the water supply. It could cost as much as $6000 or more in some cases to have a new well drilled.

Old Septic Systems

An old or poorly maintained septic system can be costly to repair or replace. Aging septic systems tend not to have enough field lines in the leach field, leading to septic backups.

In many older septic systems, people would redirect water from bathtubs, sinks, and clothes washers to a nearby ditch. The existing septic system can not handle the load placed on it with connected items. This is an EPA violation and can lead to fines if discovered.

A new septic system that meets EPA regulations can cost a minimum of $10,000 to replace in most areas. If a pumping station is required, that cost could easily double. If blockages exist, a poorly maintained septic system could require septic tank pumping and potential field line replacement.

Home Inspection Environmental Finds That Can Be Home Buying Deal Killers

home inspection

Buried Oil Tanks

People often heated homes built between 1930-1990 with an oil furnace. Often oil tanks were buried underground. For a buried oil tank that is no longer in use, you should decommission the tank, and the owner should have documentation to support the decommissioning of the tank.

An oil tank that is intact with no leakage can cost as much as $5000 to remove. An oil tank leaking can cost over $10,000 to remove, especially if groundwater is affected.

The Presence of Mold

Let’s be clear upfront. Mold spores are everywhere and in every house, and not all mold types are dangerous to humans and pets. Black mold is a common mold type that is harmful and can negatively affect people’s health.

Black mold often develops in areas where water intrusion or water leaks develop. Black mold will have a potent smell and cause your eyes to burn from irritation in the short term. Long-term exposure can cause severe respiratory health problems or other medical conditions, which could cause death.

Some mold conditions require simple cleanings, but more severe conditions could require mold remediation, causing several thousand dollars to correct.

Lead-Based Paint

Lead paint was common in homes built before 1973. Buyers purchasing a home built pre 1978 should be aware of the risk for the presence of lead-based paint. If peeling interior or exterior paint is present on a pre1978 house, the home inspector will document repair completed by an EPA lead-based paint contractor.

EPA lead-based paint contractors cost about two times the cost of a post-1978 constructed house due to the strict EPA guidelines that you must follow. Buyers should never sign a lead-based paint waiver without having a lead-based paint test performed.

Asbestos in the Home

Asbestos is a cancer-causing material commonly found in many building materials built before 1975. Building materials such as roofing felt roof penetration sealant, tape used to seal ducts, ceiling tiles, attic insulation, piping insulation, and cement board siding might contain asbestos.

Unless disturbed, asbestos usually isn’t problematic unless airborne. Asbestos insulation deteriorating around old pipes can be a severe health issue and should be remediated by a qualified asbestos abatement contractor before closing.

High Levels of Radon Gas

Radon is a chemically nonreactive inert gas that is emitted from the ground. The most commonly recognized means of exposure in people is breathing in harmful gases. High levels of radon gases have been found throughout all 50 states.

However, high levels of radon gases are very sporadic. You should test every home located in mid to high-level areas of known radon. There are about 20,000 deaths annually due to radon exposure. If a house tests positive for high radon gas levels, a radon gas mitigation system will need to be installed.

Other Home Buying Deal Killers

Inexperienced Home Inspectors

The home inspection industry is getting younger. More young people are flocking to become home inspectors because they see opportunities. At one time, only seasoned contractors would enter the home inspection industry after they got tired of swinging a hammer.

Now many people with varying backgrounds are becoming home inspectors and many have no home building or trade experience. It’s not to say that someone without a construction background shouldn’t be a home inspector. That couldn’t be further from the truth.

There are presently 11 states that have no state licensing laws for home inspectors. You can literally decide one day to become a home inspector, print business cards, and go to work. You don’t even have to get certified through NACHI or ASHI in these states.

In most states, appraisers are required to take a state exam and work under a licensed appraiser for 2 years to become fully licensed.

In other states, you can become a home inspector by attending an online class and passing a state test. Most states have no requirements for home inspectors to work under someone with more experience for any period of time.

Doing home inspections correctly requires some real-world experience. It also takes customer service skills which many don’t have. Much like a doctor with a poor bedside manner, a home inspector has to know how to communicate with customers and agents, which is a skill that takes time to learn.

Home Buyers with Unreal Expectations

If you’ve been in real estate and spent time on social media, you’ve probably seen the memes floating about that poke fun at home buyers and HGTV. The memes poke fun at how home buyers have unreal expectations about a property they plan to purchase.

TV shows about buying and flipping houses or home inspections where a home inspector identifies all these building code defects, which lead to complete home renovations are entertainment, but plant unrealistic seeds of how real estate really works.

These shows, while very entertaining, have created unreal expectations in some home buyers’ minds. These shows are staged, and most, if not all, the participants are actors. They blur the lines between TV and reality. When an actual real estate transaction doesn’t go as they think it should, frustration can set in.

Misinformed Buyers, Sellers, and Real Estate Agents

You could avoid nearly every potential deal breaker with proper education. Today’s home buyers have had little to no training on evaluating a home other than what they’ve seen on TV. Fewer students are enrolling in technical schools to learn the construction trades now than ever.

Homebuyers lack the skills needed to vet a house before purchasing it properly. Many first-time homebuyers entering the market don’t know about home maintenance and repairs. Many lack the necessary skills to evaluate even the most basic home defects.

Pre-Listing Home Inspections

Home sellers aren’t exempt here. They, too, lack the skills needed to prepare their homes for sale. Many home sellers have brought into the mindset that ordering a pre-listing inspection is a bad thing. Many real estate listing agents advise their clients against ordering a pre-listing home inspection because the sellers have to disclose it legally if an issue does arise.

While yes, that is true, it will arise either now or later if the problem exists. Real estate agents and sellers that choose to bury their heads in the sand out of fear a home inspector may discover a potentially costly problem exists is only setting themselves up for failure at the most critical time in the real estate transaction.

A pre-listing home inspection (see 35 Seller Tips to Pass a Home Inspection) can help the seller identify potential major problems upfront and take the necessary actions to correct the issues before potential buyers begin touring the home.

Often, sellers can address these things for far less money with a contractor of their choosing if they are proactive about the problem rather than reactive at the moment when a buyer is involved and threatening to walk away.

It could also yield a higher sales price as it instills trust in potential buyers resulting in multiple offers driving up the sales price. A pre-listing home inspection is generally a smart idea if the house is over 20 years old or if the seller has doubts or questions concerning the house’s overall condition.

Inexperienced Real Estate Agents

Many real estate agents, especially new real estate agents, lack the knowledge to properly advise buyers and sellers before listing a home or submitting an offer sheet. These aren’t taught in real estate school and have to be learned independently.

Part of being a successful agent is not only being able to meet their clients’ home buying or selling needs but also to direct them to the right properties in the first place. Many homeowners learn how to do home repairs through YouTube.

Home Buyers with Analysis Paralysis

Home inspections have drastically changed in the last ten years. In the past, a home inspection report contained 15-20 pages of information and included only a few photos of defects noted.

Nowadays, inspection reports are written on mobile devices and can include over 50 pages of detailed information with potentially hundreds of digital pictures and links to supporting documentation online. Buyers often lack the knowledge necessary to process this much information quickly and make an informed decision.

Sellers Response to the Home Inspection

Sellers possess one thing that no real estate agent or buyer has. It can’t be measured or fully understood; it’s an emotional bond with the house. Often this is a home they’ve lived in for years; they’ve raised a family and made wonderful memories there. This emotional bond can often cloud a seller’s judgment about the place they’ve called home.

Sellers can quickly become offended when a home inspector reports something is seriously wrong needs to be addressed. An emotional seller may see it as a personal attack against them and how they’d cared for the property. This couldn’t be farther from the truth.

Emotional sellers find it hard to accept that the house they’ve loved for many years may require serious work that they were unaware of. A refusal on their part to address specific items due to an emotional connection may ultimately cost them a sale if they’re not willing to negotiate.

Related Questions

Should you use a home inspector that your realtor recommends? A realtor will often refer you to a home inspector they’ve worked with in the past. This is usually not necessarily a bad thing; however, you should still do your homework and speak with at least three home inspectors before hiring one.

How long does it usually take to get the results of a home inspection? Most home inspectors will have your home inspection report completed and delivered to you via email within 24-48 hours. Once the home inspection report is completed and received, you’ll need to determine if any repairs are necessary to proceed with your home purchase.

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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.
DISCLAIMER: The content published on HomeInspectionInsider.com is not professional advice. You should consult with a licensed professional and check local permit requirements before starting any project.
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