R
eal estate professionals are reporting a surge in home buyers backing out of deals before closing, often due to negative home inspection reports. Melissa Bailey, a real estate agent with the Jason Mitchell Group in Scottsdale, Ariz., has seen this trend firsthand, with four listings falling through contract due to buyer concerns over minor repairs.

    The number of canceled contracts is on the rise, currently standing at 6% nationwide, according to the REALTORS Confidence Index. Some brokerages report even higher rates, with Redfin data showing nearly 15% of homes under contract fell through in May, a record high for that month.

    To mitigate this issue, some agents are recommending pre-listing inspections, where a home is professionally inspected before it goes on the market. This allows sellers to address any issues before listing and avoid costly surprises during the buyer's inspection. Cara Ameer, an agent with Coldwell Banker's Vanguard Realty in Ponte Verde, Fla., advises her sellers to consider pre-listing inspections as a proactive step.

    Ameer notes that being upfront about a home's condition can build trust with prospective buyers and give them confidence in their purchase decision. While buyers are still encouraged to complete their own inspections, the seller's report can serve as a baseline or even reassure buyers enough to move forward.

    The demand for pre-listing inspections is growing, with companies like HomeTeam Inspection Services seeing an increase in requests from listing agents. Matt Cook, director of business development at HomeTeam, notes that sellers who opt for pre-listing inspections gain an upper hand by addressing potential issues before the buyer's inspection.

    Sellers don't have to fix every issue uncovered during a pre-listing inspection, but it gives them the opportunity to make repairs and disclose any problems upfront. This can help buyers factor needed repairs into their offer rather than using them as a reason to walk away later.