When you buy a house with a home inspection contingency, you get to have the property professionally inspected before you’re locked into your contract. If the house fails a home inspection, the buyer has the option to exit the deal or renegotiate terms.

This article reviews the most common things that fail a home inspection. Discover what a home inspector might find in a home that would cause the sale to fail or require price or seller concession re-negotiation.

1. Ground Sloping or Drainage Issues

Drainage issues attract mosquitoes and cause messy mud pits that ruin your lawn. But the bigger problem is what you can’t see – water pooling against your home’s foundation. Over time, this excessive moisture against the foundation can cause cracks, flooding in your basement, and serious structural damage.

Problems with the ground sloping toward the house and improper drainage lead to potential foundation damage. It can damage the exterior foundation and siding or lead to future flooding.

Slope and drainage issues are common fixes for qualified landscaping companies. With some re-grading and drainage solutions (like French drains), you can divert water from your home and prevent flood damage. However, fixing these issues and their subsequent damage can be costly, so sometimes buyers want to have that cost worked back into their purchase contract.

2. Foundation Problems

Foundation damage poses serious threats to a home’s structural integrity. Some common foundation issues include:

• Cracks
• Leaks
• House settling and sinking
• Bowing basement walls

There are 5 major types of foundation damage that require expert repair and can cause a house to fail a home inspection:

• Bowing and Buckling Walls – This happens when water presses on basement walls, causing them to bow inward. Clay soils are especially problematic as they expand and contract.
• Concrete Honeycombing – Honeycombing in concrete typically results from improper compaction, insufficient vibration during the pouring process, or inadequate cement paste to fill the gaps between aggregate particles. Honeycomb voids in concrete let in water, causing rust and corrosion. The cracks need sealing from the interior or exterior.
• Horizontal Cracks—Sideways foundation cracks indicate excessive water pressure, which, if left unrepaired, can lead to leaks or collapse.
• Foundation Settlement – Deterioration and sinking due to improper soil moisture. Experts can raise and reinforce the foundation.
• Leaking Pipes – Water penetration around pipes causes leaks. Epoxy or polyurethane injection creates a watertight seal.

Foundation problems can be expensive and time-consuming to repair. Even small cracks need to be addressed quickly before turning into larger, serious foundation issues. Left unaddressed, foundation damage only worsens and can damage the home’s structural integrity, eventually leading to collapse.

Major foundation problems during a home inspection could lead the buyer to leave the home entirely. If undisclosed foundation damage is found, sellers should be prepared to negotiate their sale terms.

3. Plumbing Issues

Leaky pipes, poor water pressure, clogged drains, and aged plumbing components are some of the most common plumbing issues that fail a home inspection.

Old galvanized steel and cast iron pipes are prone to corrosion and rust buildup over time, which can restrict water flow. Polybutylene plastic piping installed before 1995 was used as a cheaper alternative to copper but has been found defective, often cracking and causing system failures.

Leaks within walls and under floors often go undetected for long periods. This not only wastes large amounts of water but also causes structural damage and mold growth.

Malfunctioning water heaters, due to age or improperly high water pressure, are another common inspection issue that requires replacement. Sediment buildup and rust are signs of deterioration.

Even small leaks and drips add up to thousands of gallons of wasted water annually and damage the surrounding property. Sometimes, a lead can be an easy fix, while larger leaks may require more work that sellers have to fix.

4. Roof Problems

When buying or selling a home, the roof inspection is one of the most critical parts of the home inspection process.

Unaddressed roofing issues can lead to expensive repairs, water damage, and even safety hazards. In a humid climate, roof issues tend to develop more rapidly than in other parts of the country.

During an inspection, there are several common problems for buyers and sellers to be on the lookout for:

• Water Damage
  One of the most common inspection findings is water damage on roofs and ceilings. Signs include interior stains, discolored walls, and mold growth. Inspectors check for proper drainage and leakage points like flashing.
• Chimney and Skylight Leaks
  Chimneys and skylights are prone to flashing seal failures causing leaks into the attic and home interior. Signs are visible moisture stains around chimneys/skylights, peeling paint, and attic moisture.
• Damaged, Curling, or Missing Shingles
  Inspectors check for compromised shingles with brittleness, cracking, missing sections, or peeling spray on surfacing materials. Even minor damage can lead to leaks over time.
• Gutter Issues
  Clogged, sagging, or damaged gutters cause overflow issues. Inspectors check proper drainage and any visible damage.
• Poor Attic Ventilation
  Inadequate ventilation causes moisture and heat buildup in the attic, leading to mold, rot, and ice dams. Inspectors examine ventilation systems to ensure roof protection.

Depending on the severity of the problem, roof issues can lead to a failed home inspection. If the house needs a roof replacement, it can cost tens of thousands of dollars; however, sometimes sellers just need to replace damaged shingles, which is much more manageable.

5. HVAC System Malfunctions

Unfortunately, HVAC issues that may seem minor at first can snowball into expensive equipment repairs or full replacements if left unaddressed.

During a home inspection, experts thoroughly test HVAC operation and look for common problems, including:

• Dirty air filters reduce system airflow and efficiency.
• Refrigerant leaks indicate cracks or seals needing repair.
• Faulty heat exchangers can leak dangerous carbon monoxide gas.
• Drain line clogs create indoor moisture and mold risks.
• Poor ductwork connections or damage impeding air distribution.
• Outdated systems near or exceeding the typical 10-15 year lifespan.

While HVAC systems might not be a dealbreaker, sellers may request repair work or concessions, especially if the rest of the home is relatively new.

6. Water Damage and Leaks

Water damage is considered a serious issue during a home inspection. This is because small leaks or signs of minor flooding in the past can also lead to major problems if left unaddressed.

Here are some key areas in which a home inspector can find leaks that can fail a home inspection:

• Roof & Attic: The roof, flashing, gutters, and downspouts should be inspected for visible moisture staining, pooling water, leaks, or missing or damaged shingles/materials. Major roofing issues can be one of the things that fail a home inspection.
• Plumbing: Under sinks, near water heaters, and along water lines for corrosion, leaks, or water staining.
• Basement/Crawlspace: Signs of water intrusion like efflorescence, mold/mildew growth, or staining on walls or floors can be indications of a larger problem.
• Windows/Doors: Thresholds, frames, and sills should be inspected for water stains or rotting wood, which indicate leaking seals/flashing.
• Exteriors: Inspect siding, trim, and mortar for gaps/cracks and areas of deterioration often caused by unchecked moisture.

Water damage reported on an inspection report can signify larger structural issues and should be addressed accordingly. The seller should be prepared to fix the problem or adjust their purchase price depending on market conditions.

7. Mold Presence

Mold can pose serious health and safety risks when present in a home. This fungus thrives in damp, humid areas like basements, attics, and bathrooms. As mold spreads, it releases spores into the air, triggering allergy symptoms, respiratory issues, and illness in occupants.

Additionally, mold causes structural damage as it takes hold within a home’s walls, insulation, carpets, and other materials. It slowly breaks down these elements, leading to expensive repairs and remediation.

In most states, sellers must disclose known mold issues upfront. Proactive mold removal maintains the home’s value and ensures the health of future occupants.

Home inspectors look for visible mold, water stains on walls and ceilings, condensation issues, and leaks that may lead to mold. Catching a mold problem allows the buyer to negotiate repairs or a home price. If the inspection uncovers mold, the buyer can request that the seller carry out professional mold remediation before purchase.

8. Pest Infestations

Pest problems such as termites, mice, rats, or cockroaches can result in thousands of dollars in damage and be difficult to get rid of. Inspectors look for telltale signs like chew marks, droppings, nests, and tunnels that point to an active infestation.

It’s advisable to get a separate termite inspection in addition to the standard home inspection. Catching pest issues allows the buyer to request treatment and repairs from the seller before closing.

The seller may have to hire an exterminator and either pay for or contribute funds towards repairing any damage.

9. Rotting Wood

Wood rot poses a major threat. Excess moisture enables fungus growth that decays wood over time, compromising critical structural integrity. An inspection focuses on visible signs like cracks and discoloration in vulnerable damp areas. If unaddressed, rotting progressively destroys critical framing, siding, and supports, severely undermining the home’s structural soundness.

Discovering wood decay can indicate a larger core problem and cause a home to fail an inspection. Remediation requires eliminating the source of moisture, removing all affected wood, and replacing it with treated lumber. Severe cases may require sistering in new framing alongside the deteriorated studs or posts. Catch rot early before major framing and foundational members are compromised.

Left unaddressed, ongoing rot severely undermines the structural integrity and can cause safety issues if walls, roofs, or floors become unstable. 

10. Safety and Security Issues

Safety and security concerns are a key part of any home inspection. If the buyer is purchasing with an FHA or VA home loan, safety reasons can cause properties to fail home inspections. Small deficiencies can put the home’s occupants at risk and lead to costly repairs if not addressed quickly.

Here are some key safety hazards inspectors look for that homeowners should be aware of:

• Existing and working smoke detectors and carbon monoxide detectors.
• Potential electrical problems such as missing junction boxes or faulty wiring.
• Presence of secure safety railings and balancers on stails, decks, or porches.
• Adequate indoor lighting.
• Working locks on all windows and doors.

Addressing minor safety or security issues before listing a property for sale is usually the most cost-effective solution. Sellers who suspect safety issues should address them promptly to avoid failing a home inspection.

11. Asbestos and Lead Paint

Asbestos and lead paint are health hazards related to older construction materials. A seller is not required to remove lead paint or asbestos, but they can be a concern for buyers. Most buyers know that these materials may be present if they are purchasing a home built within a specific timeframe.

Asbestos is a dangerous material known to cause lung cancer and mesothelioma. Homebuilders in the 1930s to 1970s used primarily in home insulation, tiles, and textured walls. Asbestos was phased out of most industries, including home construction, in the 1970s.

While asbestos isn’t a health risk if left untouched, it is very dangerous if it is disrupted and particles are breathed in. For this reason, it must be professionally removed during any home renovation, which can be costly. Depending on the size of the area, asbestos removal can cost between $1,250 and $12,000.

Lead paint was banned across the country in 1978. However, it is still a problem today and is the leading cause of childhood lead poisoning.

Remedial options for lead paint include:

• Encapsulation: Apply a paint-like sealant to prevent lead paint from flaking and creating dust or chips.
• Enclosure: Cover lead-painted surfaces with drywall or siding to contain the lead.
• Removal: Labor-intensive and costly, but permanently removes lead paint.
• Replacement: The most expensive option involves removing and replacing lead-painted surfaces, then repainting with lead-free paint.

While the presence of asbestos or lead paint usually doesn’t lead to contract renegotiations, it may cause a wary buyer to walk away from the purchase.

12. Radon Detection

Radon is a naturally occurring radioactive gas that is produced from the decay of uranium in soil, rock, and water. It is colorless, odorless, and tasteless, making it difficult to detect without specialized testing equipment. Radon gas can seep through the ground and enter homes through cracks and gaps in the foundation, floors, and walls.

Radon is a leading cause of lung cancer, second only to smoking. Long-term exposure to high levels increases cancer risk. The U.S. Environmental Protection Agency (EPA) considers radon levels at or above 4 picocuries per liter (pCi/L) to be high and recommends taking action to reduce them.

Homes or buildings with high radon levels require mitigation efforts to reduce the concentration to safer levels. A professional can install a vent pipe system and fan to reduce radon levels in your home. Furthermore, it can help to seal any cracks in floors or walls to limit radon entering the home. For homes with basements, a sub-slab depressurization system reduces radon levels by venting radon gas from beneath the foundation. These systems typically cost $1,500-2,500.

13. Building Code Violations

Home inspectors check for violations of local building codes, as major issues like inadequate electrical wiring or structural capacity can require expensive corrections. Minor problems are affordable to fix, but non-compliance with current standards often necessitates costly upgrades.

Depending on the severity of the code violations and whether or not they have been “grandfathered in,” a buyer may request concessions.  

14. Termite Damage

If left unchecked, termites can critically damage framing and structure. Inspections look for telltale signs like tunnels and hollowed wood.

Extensive repairs to compromised components can be very expensive. Catching infestations early allows buyers to require sellers to address damage before closing and avoid inheriting major headaches.

In the event termites are found, sellers should assess the cost of reasonable repairs and if they want to offer a repair credit.

What to Do When Your Home Fails an Inspection

When a home inspection uncovers issues that require repair, sellers have several options to address them and avoid derailing a sale. Typically, real estate market conditions and the desirability of the property will impact a seller’s willingness to negotiate.

Disclosure and Negotiation

Honesty is the best policy. Sellers should be transparent with potential buyers about the property’s condition to help avoid surprises during an inspection. If major issues are found, use the inspection report details as a tool for negotiation. Sellers may opt to adjust the listing price, offer closing credits, or agree to make select repairs. Open communication allows both parties to reach an agreement.

In a neutral or buyer’s market, a seller may have to be more flexible by lowering their price or offering concessions at closing. However, sellers in a seller’s market have more negotiation power and may not be as ready to cover costs. Sometimes, a small repair credit

Consult with Professionals

Homeowners can engage appropriate contractors or specialists to inspect defects further and provide accurate repair quotes. This allows sellers to get a precise sense of costs. Sometimes, fixing a defect found during a home inspection can be done quickly and at a low cost.

Alternatively, getting these quotes can ease a buyer’s concerns and make them more comfortable proceeding with the sale.

Prioritize Repairs

Repairing issues in a home can often be cheaper than renegotiating a sale price. When buyers have to take on the work themselves, they see the potential risk of additional costs and, therefore, want to be compensated for that risk.

If sellers have the funds, they should aim to address any significant repairs themselves.

Sell As-Is

Selling ‘as-is’ means that the seller doesn’t opt to negotiate on any required repairs and that the burden rests solely on the buyer. Selling as-is usually requires marketing at a reduced price. However, in a competitive real estate market, an as-is purchase might not deter many buyers.

A seller who gets made aware of significant problems during a home inspection can either choose not to negotiate, often leading to the buyer walking away. However, they can then choose to relist their home as-is.

Don’t Let Inspection Issues Derail Your Sale

A home inspection is a critical step for all real estate transactions and it’s important to understand the things that fail a home inspection. When defects are uncovered in a home inspection report, sellers shouldn’t panic.

Being aware of the possible options, from negotiating credits to agreeing on key repairs, allows homeowners to address problems strategically. Consider your budget constraints and current market trends when deciding the best route forward. Repairing issues that most seriously impact home value and safety should take priority. With smart planning, even failed inspections don’t have to upend potential sales.

Connect with an experienced real estate agent on FastExpert who can facilitate inspections, coordinate common issues, and ensure your next property transaction succeeds despite the presence of any home issues. Start your agent search with FastExpert and connect to a qualified local agent to tackle any issues properly.

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• Source: https://www.fastexpert.com/blog/14-common-issues-that-fail-a-home-inspection/