Real Estate Talk:
Major issues in inspection
The buyer’s options when inspection reveals important problems
By Joseph Marovitch
July 31, 2025
When purchasing a residential property, some conditions should always be in the offer, and one of those conditions is inspection. Some buyers pass on an inspection to save money, or because they plan to renovate or because there is too much competition and they do not want to lose the property. However, inspections can reveal or detect various issues that require further inspection by a specialist. Inspections provide confidence in the purchase, saving money by renegotiation, or help the buyer to avoid a long and expensive repair altogether.
The question is: What are the buyer’s options if there are major issues? I am always asked what if the inspection reveals an issue I do not want to contend with? Can I cancel the offer?
The answer is yes; it is possible to cancel the offer. However, unless the promise to purchase states, under the condition of inspection, that the inspection must be to the satisfaction of the buyer, there are rules in place that can not allow the cancellation of the offer. When issues arise from an inspection, the buyer has the option to cancel, renegotiate or purchase “as is”. However, all these options are the same for the seller. The seller can reduce the price to compensate for the issue, repair the issue, or do nothing. If the seller decides to do nothing, this will allow the buyer to choose from their three options.
Inspections provide confidence in the purchase, saving money by renegotiation, or help the buyer to avoid a long and expensive repair altogether.
However, there is a stipulation under which the seller can contest the cancellation of the offer due to inspection. If the issue is not significant, meaning it hardly reduces the value of the property, the seller can dispute the issue by stating that the issue in the report does not devalue the property, and therefore, the cancellation is not accepted.
In this case, the seller would also have an inspection to determine whether the reason for cancellation or reduction of price is valid. Following this step, both the buyer and seller may have to go to court and let a judge decide. In most cases, this does not occur because a court case can take a long time and delay the sale of the house to another buyer. However, it is an option the seller can exercise. In most cases, the buyer would provide written notice that, due to inspection, the offer is considered null and void. The seller would accept this and move on.
Note that if the promise to purchase states the inspection must be to the buyer’s complete satisfaction, then the buyer can always cancel the offer. However, also note that if the words “to buyer’s complete satisfaction” are in the offer, there is a very high chance the seller will not accept the offer if there is another interest, since “to buyer’s satisfaction” is a ticket to cancel the offer for any reason.
The information in these articles is a summary. Should you have questions, comments or wish to discuss further, please refer to the comments section at the bottom of the page or contact me directly. As well, to view past articles, click here.
Next article: Preparation for the fall market
State of The Market
The good news is the Bank of Canada will be holding the current interest rate at 2.75% with inflation at 1.9%, which is higher than June’s rate of 1.7%. However, it is unlikely that there will be more rate cuts soon, with looming additional tariffs and negotiations with the U.S., over tariffs, at a standstill.
‘… sellers who are uncertain about the direction of inflation, and do not want to gamble that rates and inflation will increase, are deciding to sell now, and this provides buyers more negotiation power in terms of price and terms.’
The current economy and politics between the US and Canada make for an uncertain future in terms of inflation and interest rates. What the current situation does do is allow for a buyer’s market. Many sellers are in a wait-and-see mode. Those sellers who are uncertain about the direction of inflation, and do not want to gamble that rates and inflation will increase, are deciding to sell now, and this provides buyers more negotiation power in terms of price and terms.
The flip side is that with less inventory, if buyers want a particular property and the seller is stern in their demand, the buyers are motivated. With proper negotiation and tactical strategy, both buyers and sellers can walk away from the negotiation table very satisfied.
For further discussion, leave a comment or call me directly.
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