Buying a Home in the “Wild West” of Housing Markets
With the current housing market very much favoring sellers, buyers are resorting to outlandish tactics in order to land their dream home—or even a rickety old fixer-upper. People are willing to forgo various important contract conditions to snag a new pad. Some pay tens of thousands of dollars over the asking price as well as the seller’s fees and closing costs. Some relinquish an appraisal. Worse, some waive a home inspection, going into perhaps the largest purchase of their lives sight unseen.
An inspection is vital to the home purchasing process because it allows buyers to become aware of and assess potentially expensive or dangerous problems before committing to a purchase. Whether it’s a cracked foundation or faulty wiring that could lead to a house fire, prospective homebuyers need to know about the unseen baggage of any home they might purchase. But of course, everyone has their own threshold for risk, so which states have the riskiest homebuyers?
To find out, we surveyed 3,131 American adults across the United States and asked them to disclose their risk tolerance in homebuying on a scale of 1 to 5, with 1 representing the least risk and 5 representing the most risk. From there we calculated the average risk in every state except Alaska, Delaware, Hawaii, Idaho, Montana, New Hampshire, North Dakota, Rhode Island, South Dakota, Vermont, and Wyoming due to not enough responses.
Further, we asked survey respondents supplemental questions around risky homebuying behaviors such as:
- Buying a home without seeing it in person
- Forfeiting an inspection
- Skipping an appraisal
- Paying significantly over the asking price
Read on to find out which states have the riskiest homebuyers!
- 40% of Americans would be willing to pay $20K over the asking price for their dream home
- Almost 30% of Americans would be okay with bribing someone to get their dream home
- Only 3% of Americans would actually skip a home inspection altogether
- 80% of Americans are willing to purchase a fixer-upper and 42% would purchase a home that didn’t meet their requirements just to be a homeowner
- 6 in 10 Americans believe the market is too volatile right now to consider purchasing a home
The States With The Riskiest Homebuyers
Interestingly, the national average level of risk when it comes to forgoing certain contract conditions for a greater chance at winning an offer was 2.5 out of 5. This middling stat highlights the back-and-forth between fear and risk. As much as people want to play it safe, they also feel like they have to take on risks to secure a new home.
Pockets of higher risk were scattered across the country—including Maryland (2.84), Washington (2.82), Utah (2.79), Arkansas (2.74), and Louisiana (2.73). These states throw caution to the winds when purchasing a new home. These states are the most likely to discard important home buying practices put in place to protect buyers.
The states with the least risky homebuyers include North Carolina (2.17), Michigan (2.19), and West Virginia (2.20). While displaying more risk aversion than most other states, they’re still taking on a considerable amount of risk in the homebuying process. We decided to look into this with a detailed lens.
The States Most Willing to Forgo Homebuying Contract Conditions
Specifically, we asked respondents how likely they are to skip an appraisal, buy a home without seeing it in person, and forfeit an inspection. In the interactive map below, hover over each state to see how the results play out.
Appraising a home is the process of getting a professional opinion of the value of the property. Forgoing this is a bad idea. And yet, at least 12.00% of homebuyers in Iowa, Oklahoma, and Maryland are willing to do so! 11.76% and 11.54% of respondents in Pennsylvania and Minnesota, respectively, said the same.
Another mistake is to buy a house without seeing it in person. At most, 11.11% of Coloradoans admitted to being likely to commit this homebuying transgression. Respondents in Maryland and Oklahoma reported 8.00% likelihood while California and Utah each reported a 7.55% likelihood.
Having a home professionally inspected is a vital stage in the process. You could be protecting not only your wallet but even your life by sussing out potentially dangerous issues with the home’s plumbing, electrical wiring, structure, and more. Interestingly, most respondents (97%) don’t want to skip an inspection.
The national average of skipping an inspection is just 3.30%. Nine states—Connecticut, Georgia, Illinois, Louisiana, New Jersey, North Carolina, Texas, Utah, and Wisconsin—are not at all likely (0.00%) to buy a home without an inspection.
How Far Will Homebuyers Go to Land Their Dream Home?
Beyond skipping important steps in the buying process, we found that Americans are willing to get creative to purchase the home of their dreams. A whopping 48% of respondents are willing to dip into retirement, wedding, and savings accounts to pay for a home. If that doesn’t seem wild enough, 46% would offer additional compensation besides cash! That’s not all—41% would reach into their wallets for an additional $20k or more over the asking price for the right home. Finally, we were shocked to learn that 30% didn’t think twice about bribing someone to get their dream home.
This is in stark contrast to the 3% of respondents who are willing to skip a home inspection altogether. We believe it speaks volumes about the importance of a home inspection that far more respondents would spend their life savings, make wildly inflated offers, and even bribe someone before they would skip out on an inspection.
The majority of respondents, however, won’t even make an attempt. 6.1 out of 10 people cited that the current housing market is simply too volatile to make a move. How fitting, then, that 42% would settle for a home that doesn’t meet their requirements just to become a
Additionally, we discovered that 80% of respondents were willing to purchase a fixer-upper. These homes are not ready to live in, requiring additional work and maintenance after the deal has gone through. In short, issues are to be expected. But how do you know what to fix or where to start? Especially if it’s your first home, the mountain of repairs will get overwhelming, fast. If you are buying a fixer-upper, an inspection is all the more vital.
Based on our study, homebuyers are willing to jump through a number of flaming hoops and do outlandish things in order to snag their dream home—but skipping an inspection is not one of them. Luckily much of the general public understands the value of a home inspection. But do they understand the data that gets returned to them when the inspection is through?
It is often very difficult for the layperson to understand the dense tome of industry jargon that is generated from a home inspection. Luckily, Repair Pricer is here to help make sense of that professional jibberish and tell you in simple terms what the issues are and how much they are likely to cost.