> In the US this only costs a few hundred dollars for a typical house, which is a tiny fraction of the overall transaction price.
You know what's even better than _only_ a couple of hundred dollars? The seller paying it once.
Also, even if the money first comes out of the sellers pocket, it’s still being paid by the buyer in the houses cost.
I wouldn’t trust an inspector chosen at random, much less an inspector chosen by the seller.
To be clear, I don’t care who is paying - as long as I pick the inspector.
It's the same in Sweden, that the seller does and pays for a survey. Still common for the buyer to request to be allowed to get a second independent survey done. Of course the seller can refuse to allow a second survey, but that in itself is quite telling.
Surely you do not hire an independant accountant every time you buy stocks?
An auditor hired by the buyer has no such incentive.
The “regulatory capture” principle might apply here – an auditor only meets any one client once in their life, but probably meets some landlords many times, presumably develops a relationship with them, and might want to tend to not upset that relationship.
Of course not, I let the short sellers do it for me.
Also, making decisions around catching Tesla or GME at the right timing in the market… that’s not a great starting point for investment strategy.
I thought the same thing for years, and just avoided the market except for a 401k and stock granted by companies I worked at. Then I got into trading because I thought I could make money trading volatile stocks and I've never looked back (I've already made enough to retire). So far I've only lost money on my value stocks.
To each his own.
The best advice I can give is pretty generic - follow the data. First of all actually find the data. Don't trust some finance news rag to tell you anything meaningful, some of them actually have a direct incentive to lie to you. Now that you have the data, what does it say? This sounds simple, but everyone told me I was an idiot to invest in GME in January. They said the same thing in March. So far my investment in GME has more than a 10x ROI. I'm just using GME as an example because it's topical - people tell me I'm in a cult while I'm actively making money betting against them.
"Buy the rumor, sell the news" is pretty easy to understand, just find a stock you know well (I would guess something in tech, like Alphabet or Amazon but whatever) and look at dates for stock movements, rumors, and announcements. You can do this retroactively to find a pattern then try to apply it moving forward. "Never invest in something you don't understand" is general advice outside of stocks, but just an extension of what I said initially - do your own research until it makes sense to you.
I think a huge amount of inertia is just people afraid to try it because they've been conditioned their entire lives to believe they can't make money doing it. I'm quickly realizing how much of this is bullshit (I realize I'm lucky and I understand I'm likely in a local maxima, but I am still extremely confident a lot of the things I've been told are just wrong). So take a small amount of money and invest it and see how it goes. Learn. Iterate. Improve. The goal is to start making money before you lose it. I actually started with just $10k and once I started to figure it out put in more money as I wanted to increase my profit.
At the end of the day it's your money and you should do what you want with it. So long as you understand you will definitely lose money sometimes and are willing to learn from it, give it a go with whatever money you're willing to lose.
“On the hook” has different meanings when you have the enforcement power of the US federal government and criminal courts versus an individual who has to cough up tens of thousands for lawyers in civil court.
I had a friend who bought a house with major termite damage (i.e., every wall had to be removed to repair the studs basically), and 2 inspectors overlooked the damage. He said in retrospect (after doing a bunch of research on termite damage), it should have been obvious to inspectors, but they missed it.
He tried to pursue legal action against either the seller or the inspectors, and basically was told: impossible to prove seller knew (as there was no repairs done), and inspectors are not held liable.
If you really don't know anything about houses (or feel as if you do not), then having someone walk you through some of the things you may have to face living in a particular house is probably a good idea.
However, even as just an enthusiastic amateur, I know more about home construction and repair than most home inspectors. When I bought my current house I skipped the home inspector, and hired an electrician, a roofer and a structural engineer. It cost me more, but I got seriously informed reports about the property, not just boilerplate fill-in-the-blank PDFs telling me that one of the windows rattled.
If there's anything remotely questionable, they'll punt and tell the buyer to hire an actual engineer (or plumber or electrician), so even more money out of pocket.
When I have bought a house, in order to get a proper survey with the property boundaries marked by stakes I had to pay for that myself.
Does anybody do this?
One of the issues that keeps there from being a neutral third party holding the inspection results is the vast difference in quality in home inspections. Since home inspectors are not liable for anything they miss in the inspections, there are some really poor quality inspectors out there. The third party hiring the inspectors isn't going to be aligned with your interest in hiring the best inspector. Most likely they're going to go with whoever is the cheapest so they can keep as most of the fee you and other buyers are paying them.
In states that license and regulate home inspectors, perhaps part of the requirements could be that every home inspection report has to be part of the public record for the property. If there are multiple inspections, each of them becomes part of the record. A sneaky seller might pose as a buyer and payoff an inspector to give them a good report that becomes part of the record so it would still be in the buyer's interest to hire their own inspector if there is only one inspection report. At some point though, there will be enough inspection reports that your risk of only seeing faulty reports becomes low.
Back in the early 90s — on a recommendation from a realtor who was a close friend of my brother's — I hired an inspector who was close to retirement. He worked with his wife who served as his assistant tasked with, in essence, taking dictation of her husband's near constant commentary as he conducted an incredibly thorough inspection. Every outlet tested for proper ground, every nook and cranny looked at, wood moisture content, HVAC pitot readings, masonry, roof … just a super-duper detailed inspection that took about 6 hours to complete.
At the end of the inspection, he summed up by saying the house was good and that he had no qualms recommending the house.
Two days later, he stopped by with a three-ring binder that contained his inspection report. It first contained a summary that concisely covered the positive and few negative aspects of the house. Then there was a section about the history of the house: the year built, the name of the builder, changes in the neighborhood since it had been built, earthquakes it had gone through, flood events in the area, and so on. It also included the manufacturer names of things such as the windows, door hardware, etc.
The third section was lengthy, covering the precise state of the electrical, plumbing, structural, envelope, etc, and included all the notes his wife had taken during the course of the inspection. It included a sub-section with warnings about certain materials that likely contained asbestos and would need to be dealt with if we ever did remodeling.
Finally, the largest section was what he called a "maintenance work order" arranged as a schedule for the ongoing, recurring upkeep of the house but beginning with things he thought needed to be done immediately, replacement of the circuit breaker box, splash blocks under each outdoor faucet, tuck-pointing some of the chimney's brickwork, etc. And then his estimates as to when he thought systems might need to be replaced, the water heater, furnace, roofing, etc. As I discovered when the water heater burst, his estimates were pretty much spot-on. Over time, I added notes as we upgraded things, added low-voltage wiring, and remodeled the basement.
Nine years later, when I sold the house, the buyer was elated to have this owner's manual and I am fairly certain that the book was key to a very fast sale of the house which we did without a realtor.
As I look back on it now, I realize that inspection was perhaps the best $350 I have ever spent.
When we bought our next house, the inspection took about an hour and produced a few page report, most of it boilerplate.
This was fascinating to read!
How did you find a buyer without a realtor? Are you able get into the listing databases without using a realtor? Any special tips for selling without a realtor?
The first time I mentioned to a co-worker that I was thinking about selling my (first) house. He said that he thought he could be interested. He came and saw the house and agreed on the spot to buy it. That was that. We established the price by asking the realtor who had sold us the house what the price should be and then reducing the price by an amount that was 50% of what the standard sales commission would have been. In essence, we split what would have been the commission with the buyer.
We also split the cost for a real-estate attorney — a few hundred dollars, total — and got it done in just a few days.
The second time was a little more planned. I carefully photographed the house and painstakingly built a website for it with tons of description. Whether or not we hired a realtor, I thought a website would help us sell. This was early 2001, a web presence for a house for sale was still fairly rare.
We contacted the same realtor who had sold us our first home and asked her for a market value for the house. I offered to pay her a fee for her expertise and she declined saying that she knew we'd end up hiring her anyway, and that, "You may have sold your first house on your own but you'll never be able to do it twice."
A few days after the website had gone up, I decided to put a small "for sale" sign in the yard and, no joke, as I was pounding the sign into the ground, a passing car stopped and, longer story short, within a few hours she and her husband agreed to buy the house. The husband was a building contractor and he was especially impressed by the aforementioned inspection report.
As we had done with our first house, we set the price at market minus half the commission so it was well-priced.
We hired the same real-estate attorney who put the sale together. It was super easy and done around the buyer's kitchen table in a single two-hour meeting, followed a few days later by an official closing at an escrow company.
Now that the market in our area is smoking red hot, I am pretty sure we could sell our present home on our own too. We might miss out on bidding war wins but, I think, in the end, we'd come out okay.