When Buying a Home, Don't Forget the Roof Inspection

To land their dream home in today’s ultra-competitive real estate market, buyers are making unexpected compromises. Making offers without ever walking through the door or adding escalation clauses to increase their price based on what other people are offering are just some of the compromises buyers are making more often. But a thorough home inspection is one part of the offer you should never compromise on. The inspection is a key part of determining if you’re buying a great investment or a money pit. 

One of the most overlooked parts of a home inspection is the roof inspection. Major roof repairs can cost anywhere from $5,000 to $15,000 or more – money that most first-time homebuyers simply don’t have laying around. A roof inspection can tip you off to costly problems before you sign.

Won’t My Inspector Check Out The Roof?

A general home inspection is an overview of any obvious, objective flaws in a home. For that reason, a home inspection might reveal obvious trouble about your roof, like missing or curling shingles, missing flashing, water damage (current or previous), structural integrity, and major damage. (If a home inspection reveals any of those, you should talk to the seller about what repairs have been done in the past.)

But a general home inspection won't give you an idea of every single problem the roof might have. If your home inspector notices something they can't explain, or sees signs of a larger problem, they'll probably recommend that a roofing contractor perform an additional roof inspection. (Even if they don't, it's never a bad idea to get one. The last thing you need after closing is a $15,000 invoice and weeks of work tying up your home and budget.)

How Much Does a Roof Inspection Cost and Who Does It?

It goes without saying that roofing contractors are the experts here. They’re specially trained in what to look for and what areas might need work. They can tell you if the roof needs to be replaced and how much that replacement might cost. Most reputable roofing contractors will do an inspection for the cost of the trip (and sometimes at no cost) with the hopes of getting more business if the roof does need to be replaced.

A note about the process: The “inspection period” refers to the timeframe when a buyer completes inspections on a home. The inspection period is usually about 10 days, but the exact time will be spelled out in the home's purchase contract. Any additional negotiation between the buyers and sellers must occur during this inspection period, so it’s important that you act quickly. You’ll need to find a contractor, get the roof inspection done, and negotiate any issues with the seller within the inspection period. If you have trouble finding a roofing contractor, ask your real estate agent for a recommendation.

The Roof’s Bad, Now What?

As a homebuyer, the decision of how to handle a bad roof inspection starts with you. What are your options if you love the house but don't have the budget to replace a $10,000 roof? You might try one of these routes:

• Talk with the seller about replacing the roof before closing. You can ask them to cover the entire cost, or you might pitch in by increasing your offer price to help offset some of the seller’s expense. Communication with the seller through the process is key to making negotiation work. If you hit them with a high dollar request out of nowhere on the last day of your inspection period, they may just say “no” and scuttle the deal.
• Ask the seller to pay for the roof repairs after closing. If the seller can’t afford to replace the roof before closing, they may consider setting up an escrow to pay for the roof after the deal is done. Escrow accounts are typically managed by the closing company and set aside 1.5 times the estimated cost of the work to pay the bills once it's completed. The money to fund the escrow account comes from any proceeds that the sellers are making on the sale of the home, and any money left over is then returned to the seller.
• Find another loan that offers the options you need to afford the roof repairs yourself. If those options don’t work and you're still set on buying the home, consider changing to a loan that allows you to have the work done. There are some options here including Habitat’s Rehab Loan or the FHA 203k Rehab Mortgage. Changing the type of mortgage is something that the seller would have to agree to, and both loan types have some additional steps that would need to be completed before closing.

If you enter negotiation, just remember: everyone involved in the sale (buyers, sellers, agents, and lenders) wants to close on the house. So while negotiations can feel intense, they typically end with an acceptable outcome.

A bad roof isn't a death sentence for your dream home, but it's vital to know what's in store before you find yourself stuck with a huge disappointment, big bills, and a bad roof.