Toronto buyers skipping home inspections in heat of bidding wars
Toronto's hot real estate market has many buyers passing on home inspections, once considered a crucial step before closing the deal.
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As she was preparing to do battle in Toronto’s red-hot real estate market, Vera Santillana knew she couldn’t hold back.
So — caught in a four-person bidding war to buy her first home — she skipped a step that’s long been considered crucial.
“We just had to remove all conditions, including inspections,” said Santillana. “You want to be competitive.”
It’s move that’s becoming more and more common as desperate buyers struggle to make themselves more attractive, inspectors say.
Alan Glushko, of AllMax Home Inspection, estimates business has dropped as much as 35 per cent across the industry since last year in Toronto.
It’s to the point, he said, where requiring an inspection as part of the sale means buyers “virtually have no chance of getting the home.”
British Columbia is also seeing the trend. There, the Home Inspectors Association has called for a seven day cooling off period after an offer is accepted to allow buyers to make inspections.
The association says less than 10 per cent of Vancouver homes are being inspected before sale.
For Santillana, moving ahead without an inspection proved not to be a problem. The 31-year-old hasn’t had any worries with the west-end townhouse she bought for $620,000.
But, not everyone is so lucky. Inspections often turn up issues with big-ticket items like furnaces, foundations and roofs.
“You could be buying a lemon for all you know,” Glushko said.
Charlotte Dove of Carson Dunlop Home Inspections said her business has started actively encouraging sellers to do inspections before putting homes on the market, but not everyone does.
“You have people that are putting in offers to houses that don’t have inspections who are kind of feeling like they have to go along with it in order to get the house of their dreams, or get a house at all,” she said.