Home Inspection Red Flags: 20 Deal-Breakers to Watch For
Why a Home Inspection Can Save You Thousands
A home inspection is your last line of defense before committing to the biggest purchase of your life. For $300-$500, a licensed inspector examines the property structure, systems, and components to identify problems that are not visible during a casual walkthrough. Some issues are cosmetic and easily fixed; others are deal-breakers that can cost tens of thousands of dollars to repair or pose serious health and safety risks.
Here are 20 red flags that should make you pause, negotiate, or walk away – along with typical repair costs and strategies for handling each one.
Structural and Foundation Issues
1. Foundation Cracks
Severity: High. Hairline cracks in a foundation are common and usually cosmetic. But horizontal cracks, stair-step cracks in block foundations, or cracks wider than 1/4 inch can indicate serious structural movement.
Typical repair cost: $2,000-$7,000 for minor crack repair; $10,000-$30,000+ for major foundation stabilization with piers or underpinning.
Negotiation strategy: Get a structural engineer inspection ($400-$800) before proceeding. If major work is needed, request a price reduction equal to the repair cost or walk away.
2. Sagging or Uneven Floors
Severity: High. Floors that slope noticeably or feel bouncy underfoot can indicate foundation settlement, deteriorated floor joists, or inadequate structural support.
Typical repair cost: $5,000-$20,000 depending on the cause. Sistering joists is relatively affordable; foundation work is not.
Negotiation strategy: Identify the root cause before negotiating. A sloping floor from a single rotted joist is very different from one caused by ongoing foundation failure.
3. Bowing or Cracked Basement Walls
Severity: High. Inward bowing of basement walls indicates lateral pressure from soil and water. Left unaddressed, walls can eventually collapse.
Typical repair cost: $5,000-$15,000 for wall anchors or carbon fiber straps; $20,000-$40,000 for full wall replacement.
Negotiation strategy: This is a legitimate deal-breaker. If the seller will not make repairs or provide a significant credit, strongly consider walking away.
Roof Problems
4. Roof Nearing End of Life
Severity: Medium-High. Asphalt shingle roofs last 20-30 years. Curling, cracking, or missing shingles, along with granule loss in gutters, signal a roof that needs replacement soon.
Typical repair cost: $8,000-$15,000 for a standard asphalt shingle replacement; $20,000-$40,000+ for larger homes or premium materials.
Negotiation strategy: Get a roofing contractor quote and request a credit or price reduction. A roof with 2-3 years of life left is not urgent but should be reflected in the price.
5. Active Roof Leaks
Severity: High. Water stains on ceilings, damp attic insulation, or daylight visible through the roof deck are signs of active leaks. Water intrusion causes mold, rot, and electrical hazards.
Typical repair cost: $400-$2,000 for a localized repair; full replacement if the leak is systemic.
Negotiation strategy: Demand the seller repair the leak before closing, with a re-inspection to verify the fix. Do not accept a credit for an active leak – you need it fixed, not estimated.
Water and Moisture Problems
6. Water Damage and Staining
Severity: Medium-High. Water stains on walls, ceilings, or around windows indicate past or present leaks. The stain itself is cosmetic, but the underlying cause (roof leak, plumbing failure, poor grading) may be expensive.
Typical repair cost: Varies widely – $500 for a minor plumbing fix to $15,000+ for extensive water damage remediation.
Negotiation strategy: Identify and fix the source before closing. Cosmetic staining is cheap to paint over, but hidden mold behind walls is not.
7. Mold Presence
Severity: High. Visible mold, musty odors, or lab-confirmed mold in air quality testing is a serious health concern, especially for people with allergies or respiratory conditions.
Typical repair cost: $1,500-$5,000 for localized remediation; $10,000-$30,000 for whole-house remediation if mold has spread through HVAC or wall cavities.
Negotiation strategy: Require professional mold testing ($300-$600) to determine type and extent. Demand full professional remediation before closing, not DIY cleanup.
8. Poor Drainage and Grading
Severity: Medium. If the ground slopes toward the foundation rather than away from it, water will pool against the house and eventually find its way inside. Signs include wet basements, efflorescence on foundation walls, and erosion patterns.
Typical repair cost: $1,000-$5,000 for regrading; $5,000-$15,000 for a French drain or sump pump system.
Negotiation strategy: This is fixable and common. Request a credit or use it as leverage for a price reduction.
Electrical Issues
9. Outdated Wiring (Knob-and-Tube or Aluminum)
Severity: High. Homes built before 1950 may have knob-and-tube wiring; homes from the 1960s-70s may have aluminum branch wiring. Both are fire hazards and many insurance companies will not cover homes with these systems.
Typical repair cost: $8,000-$20,000 for a full rewire, depending on home size and accessibility.
Negotiation strategy: Check with your insurance company first. If they will not insure the home without a rewire, the seller must address it or you cannot close.
10. Overloaded or Undersized Electrical Panel
Severity: Medium-High. A 60-amp or 100-amp panel may be insufficient for modern electrical demands, especially if you plan to add an EV charger, HVAC system, or home office. Double-tapped breakers (two wires on one breaker) and Federal Pacific or Zinsco panels are specific fire hazards.
Typical repair cost: $2,000-$4,000 for a panel upgrade to 200 amps.
Negotiation strategy: Panel upgrades are routine. Request a credit or include in your offer contingency.
Plumbing Problems
11. Polybutylene or Galvanized Pipes
Severity: Medium-High. Polybutylene pipes (gray plastic, common in 1978-1995 homes) are prone to sudden failure. Galvanized steel pipes corrode from the inside, reducing water pressure and eventually leaking.
Typical repair cost: $4,000-$15,000 for a full repipe with copper or PEX, depending on home size.
Negotiation strategy: If you see low water pressure and the home has galvanized or polybutylene pipes, budget for a full repipe and negotiate accordingly.
12. Sewer Line Issues
Severity: High. Tree root intrusion, collapsed clay pipes, or bellied sewer lines can cause sewage backups into the home. A sewer scope inspection ($150-$300) is essential for any home over 20 years old.
Typical repair cost: $3,000-$8,000 for trenchless repair; $10,000-$25,000 for full sewer line replacement.
Negotiation strategy: Always get a sewer scope. If issues are found, request the seller repair or provide a credit before closing.
HVAC and Climate Systems
13. HVAC System Near End of Life
Severity: Medium. Furnaces last 15-25 years; central AC units last 12-20 years. An aging system that still works is not a deal-breaker, but you should budget for replacement.
Typical repair cost: $5,000-$10,000 for a new furnace; $4,000-$8,000 for a new AC unit; $10,000-$18,000 for a full HVAC replacement.
Negotiation strategy: If the system is over 15 years old, request a home warranty that covers HVAC or negotiate a price reduction.
14. No Central HVAC or Inadequate Heating
Severity: Medium. Homes heated with baseboard electric, space heaters, or window AC units will have high utility costs and inconsistent comfort. Adding central HVAC requires ductwork if none exists.
Typical repair cost: $10,000-$20,000 to install new ductwork and a central system; $15,000-$25,000 for a ductless mini-split system (multiple zones).
Negotiation strategy: Factor this into your offer price. It is a known condition, not a surprise.
Environmental Hazards
15. Radon
Severity: High. Radon is a colorless, odorless radioactive gas that seeps from the ground into homes through foundation cracks. It is the second leading cause of lung cancer. Levels above 4.0 pCi/L require mitigation.
Typical repair cost: $800-$2,500 for a radon mitigation system (sub-slab depressurization).
Negotiation strategy: Radon mitigation is affordable and highly effective. Request the seller install a system before closing.
16. Lead Paint
Severity: Medium-High. Homes built before 1978 may contain lead-based paint. It is only hazardous when disturbed (during renovation, sanding, or when paint deteriorates into dust). Federal law requires a lead paint disclosure for pre-1978 homes.
Typical repair cost: $2,000-$10,000 for professional lead abatement depending on affected areas.
Negotiation strategy: Intact lead paint can be encapsulated rather than removed ($1,000-$3,000). Factor costs into your offer.
17. Asbestos
Severity: Medium. Common in homes built before 1980 – found in floor tiles, insulation, popcorn ceilings, siding, and pipe wrap. Like lead paint, asbestos is only dangerous when disturbed and fibers become airborne.
Typical repair cost: $1,500-$5,000 for encapsulation; $5,000-$20,000+ for removal depending on material type and location.
Negotiation strategy: Undisturbed asbestos can often be left in place and monitored. Budget for abatement only if you plan renovations that would disturb it.
Pest and Biological Issues
18. Termite Damage
Severity: High. Termites cause over $5 billion in property damage annually in the U.S. Signs include mud tubes on foundation walls, hollow-sounding wood, and discarded wings. Active infestations require immediate treatment.
Typical repair cost: $500-$2,500 for treatment; $3,000-$15,000+ for structural repair of damaged wood.
Negotiation strategy: Require a professional termite inspection (often separate from the general inspection). If active termites are found, demand treatment and repair before closing.
19. Pest Infestations (Rodents, Carpenter Ants, Beetles)
Severity: Medium. Evidence of rodents (droppings, gnaw marks, nesting material) or wood-destroying insects (carpenter ants, powder post beetles) indicates ongoing damage and potential health hazards.
Typical repair cost: $300-$1,500 for extermination; $1,000-$5,000 for damage repair.
Negotiation strategy: Require professional extermination and repair of damaged structural members before closing.
Code Violations
20. Unpermitted Work
Severity: Medium-High. Additions, converted garages, finished basements, or electrical/plumbing work done without permits can create legal, safety, and insurance problems. Unpermitted work may not meet code, and your municipality could require you to bring it into compliance – or even tear it out.
Typical repair cost: Varies enormously – $500 for retroactive permits on minor work to $20,000+ to bring an unpermitted addition up to code.
Negotiation strategy: Research with your local building department. If permits were pulled, verify they were closed out. If work was unpermitted, factor the cost and risk into your offer.
What to Do When Red Flags Appear
Finding red flags does not necessarily mean you should walk away. Follow this framework:
- Quantify the cost. Get contractor quotes for any issue the inspector flags. Never negotiate based on guesses.
- Assess the severity. Is this a safety hazard, a structural threat, or a cosmetic issue? Safety and structural issues deserve the most attention.
- Negotiate strategically. You can request repairs before closing, ask for a price reduction, request a closing cost credit, or negotiate a home warranty. Choose the option that gives you the most control.
- Know your walk-away point. If total repair costs exceed 5-10% of the purchase price, or if the seller refuses to address major safety issues, exercising your inspection contingency is the smart move.
The Bottom Line
A thorough home inspection is not optional – it is essential. The $300-$500 you spend on an inspector (plus $150-$600 for specialized inspections like radon, sewer scope, and termites) can save you from inheriting $10,000-$50,000 in hidden problems. Attend the inspection in person, ask questions, and use the findings to make a smart decision. The best deal is not the cheapest house – it is the one where you know exactly what you are buying.