Should You Add This to Home Inspection Conditions?

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Home inspection conditions are a regular part of real estate deals, but are they fully protecting your seller?

There’s one simple addition that could give sellers more control and clarity—yet it comes with some important considerations.

Let’s break down how a small tweak to the standard clause could benefit your clients, and when it might be better to leave things as they are.

Here's the Standard OREA condition:

This Offer is conditional upon the inspection of the subject property by a home inspector at the Buyer’s expense, and the obtaining of a report satisfactory to the Buyer in the Buyer’s sole and absolute discretion. Unless the Buyer gives notice in writing delivered to the Seller personally or in accordance with any other provisions for the delivery of notice in this Agreement of Purchase and Sale or any Schedule thereto not later than [DATE] that this condition is fulfilled, this Offer shall be null and void and the deposit shall be returned to the Buyer in full without deduction. The Seller agrees to co-operate in providing access to the property for the purpose of this inspection. This condition is included for the benefit of the Buyer and may be waived at the Buyer’s sole option by notice in writing to the Seller as aforesaid within the time period stated herein.

Now, here's something to consider...

If you're representing a seller who’s accepting this condition, you might want to add this extra line to the end of the clause:

"If the Buyer terminates this Agreement on the basis of the rights contained in this clause, the Buyer agrees to provide a copy of the home inspection, in full and without redaction, to the Seller."

This additional language offers two key benefits for the seller:

1. Useful Information: The inspection report can give the seller a clear picture of any issues with the property, which could be fixed to help with future sales.
2. Legal Protection: If there’s a dispute, the report can act as evidence to show whether the buyer acted in good faith while fulfilling the condition.

However, there is a potential downside to requesting the report: disclosure obligations.

If the report reveals any defects or problems, the seller could be legally required to disclose them to future buyers. This also triggers a duty for the Realtor to disclose under TRESA (Trust in Real Estate Services Act).

So, while getting a copy of the inspection report can be helpful, there are situations where it might be better not to know.

Best to have an open discussion with your clients, present both sides of the argument, and help them decide what makes the most sense for their property.