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The question:

I've been house hunting for months and finally found a great house, but I know there's going to be a lot of interest. I know everyone says I need a home inspection, but I'm afraid I'll lose the house if I put any conditions on the offer. Should I ditch the inspection?

The answer:

Finding the right approach to offer conditions, is hot button topic these days, especially in the Toronto market where multiple offers have become the norm. Sellers with multiple potential buyers will often look to offers with the minimum of conditions, and the home inspection clause is often one of the first to go.

My advice: Don't succumb to temptation or pressure to ditch a home inspection. If a client wants to skip the inspection, I always outline the ramifications.

Savvy buyers do have several options to protect themselves while staying competitive in the marketplace. Let's take a look at the most common scenarios and some options to better equip yourself for success:

Scenario 1: You are not in a multiple offer situation

This one's simple: put in a home inspection clause. If you get any resistance from the seller, you can offer to tighten up the timeline for the home inspection as a negotiation chip (perhaps 2 business days instead of the standard 5).

Scenario 2: You are in a multiple offer situation

Option 1: Put in a home inspection clause

Be aware that including the clause risks your offer not being accepted. However, your bigger risk is that you'll discover a heap of problems down the road with all the cost and inconvenience that means. In this case, you have to balance how much you really want the property and all the other options available.

Option 2: Do a pre-offer home inspection

This is my preferred option if you are willing to spend the money for a home inspection (typically $350-500) without any guarantee of securing a successful agreement of purchase and sale.

Provided there is enough time prior to offer date, getting a pre-offer inspection done will fully inform you about the major components of the property, and give you some peace of mind about moving forward. This option hinges on the seller allowing for a pre-offer inspection, which I've found isn't usually a problem.

If it is a problem, that's a red flag that they may be trying to hide some issues with the property.

Option 3: If the seller has provided a home inspection report, do a walkthrough

Prudent listing brokers will get a home inspection done prior to listing a home. The issue with this approach is that you're relying on a home inspection paid for by the seller. Objectivity and thoroughness can be brought into question.

If you do decide to rely on a seller-supplied home inspection, contact the inspector and ask for a walkthrough of the report. This is becoming a more common practice in today's market, and home inspectors will usually charge a nominal fee (about $100) to do this.

Option 4: Skip the home inspection

This should be your last choice. If you skip an inspection and later find problems, you have little recourse. Pre-printed wording in standard agreements states in bold: "The Buyer acknowledges having the opportunity to include a requirement for a property inspection report in this Agreement and agrees that except as may be specifically provided for in this Agreement, the Buyer will not be obtaining a property inspection or property inspection report regarding the property" (Clause 13. Inspection, OREA form 100).

In a multiple-offer situation you may be tempted to take this option. In that case, caveat emptor (buyer beware).

Ricky Chadha is broker with Royal LePage Estate Realty, and specializes in applying social media and other digital tools to the business of real estate. You can find Ricky on Twitter @your416 or at his website

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