When to Walk Away After a Home Inspection?

Buying a home, whether it’s your personal residence, your next rental property, or another investment, is one of the biggest financial decisions you’ll ever make. And the home inspection? That’s the turning point.

A home inspection can reveal hidden issues that weren’t obvious during your initial walkthrough. Some problems are small and easy to fix. Others are major red flags that signal it’s time to walk away, before you get stuck with a money pit.

In fact, a 2023 report from the National Association of Realtors (NAR) indicates that approximately 9% of real estate transactions fall through due to issues discovered during the home inspection phase.

So how do you know when to negotiate, when to repair, and when to walk away after a home inspection?

After two decades of experience in rental management, along with rental inspection in Oklahoma City and nearby metro areas like Edmond, Yukon, Norman, Moore, and Midwest City. In this blog, I’ll break down everything in simple, straightforward language, using real data, examples, and expert insights. By the end, you’ll know exactly what to do.

Why the Home Inspection Matters

A home inspection is your safety net. A licensed home inspector looks closely at the home’s structure, systems, safety issues, and major components, such as:

• Roof
• Foundation
• Electrical System
• Plumbing
• HVAC (heating and Cooling)
• Attic and Insulation
• Appliances
• Windows and Doors
• Drainage and Grading
• Exterior Siding
• Garage and Driveway

According to the American Society of Home Inspectors (ASHI), 86% of homebuyers request a home inspection, and about 18% say the results helped them avoid a bad deal.

In real estate investment? That number is even higher. A single missed foundation or roofing issue can cost $10,000 – $50,000+, destroying your cash flow or ROI.

Similarly, in Oklahoma, especially around OKC, Edmond, and Norman, inspections are important because:

• Many homes were built between the 1940s and 1980s, and older systems often fail.
• The Oklahoma soil expands and contracts, causing foundation movement.
• Our state is known for hailstorms, tornadoes, and heavy winds that damage roofs.
• High humidity can create mold issues, especially in older OKC homes.

An inspection helps you avoid buying a money pit. It shows you what’s safe, what’s risky, and most importantly, what’s not worth your investment.

What Counts as a Deal Breaker?

Not every problem is a reason to walk away.

Small issues like peeling paint, loose door handles, or a broken outlet are common and easy to fix. But home inspection deal breakers are different. These major home inspections are problems that:

• Put your safety at risk
• Cost thousands to repair
• Reduce your home’s value
• Or show that the home has long-term structural issue

When several of these issues appear together, it’s usually time to walk.

When Should You Walk Away After a Home Inspection?

There are 15 clear red flags that signal it’s time to leave.

Not every flaw is a deal breaker. But some issues are serious, expensive, or unsafe, and they tell you the property isn’t worth the risk.

Let’s break down the major red flags one by one.

1. Foundation Problems (Major Structural Damage)

Foundation issues are the biggest red flag you can uncover during a home inspection. When the base of the home is compromised, everything above it is at risk. Common warning signs include:

• Cracked walls
• Sloping floors
• Sticking doors
• Water intrusion
• Long-term instability

These aren’t minor cosmetic concerns; they signal deeper problems. As licensed home inspector Sarah Miller explained in an interview with The Home Inspection Journal, “Foundation issues are not merely cosmetic; they represent a potential structural compromise. Buyers should be extremely cautious and often consult with a structural engineer to assess the full scope of the issue before proceeding.”

And she’s right. Foundation repairs can be complex, expensive, and sometimes unpredictable.

Typical Repair Costs:

• Minor repairs: $5,000 – $10,000
• Major Repairs: $20,000 – $80,000+

Because a failing foundation affects safety, insurance, resale value, and even your ability to secure financing, most buyers choose to walk away unless the seller agrees to complete major repairs using a licensed structural engineer. If the seller isn’t willing to fix the problem properly, it’s usually best for you to move on and keep looking for a home that won’t drain your budget or your peace of mind.

2. Serious Roof Damage or Full Roof Replacement

A bad roof is one of the most expensive components to repair or replace, and serious issues often reveal themselves during the inspection. Common red flags include:

• Wet spots in the attic
• Mold or rot
• Missing shingles
• Sagging roof decking
• Poor or improper ventilation

These aren’t small concerns; they’re signs the roof is failing or has already started letting water in. As John Smith, a licensed roofer, explains in an interview with Roofing Today, “The roof is the first line of defense against the elements. A roof nearing the end of its lifespan or with visible damage should be a major concern and should warrant an evaluation from a professional roofing contractor.”

And he’s right. A compromised roof can create problems throughout the home, from structural damage to mold growth.

Cost of replacement:

• Asphalt shingles: $8,000-$20,000
• Metal roof: $15,000-$40,000

If you’re buying a rental property, a failing roof brings even bigger risks:

• Future insurance claims
• Potential leaks and ceiling damage
• Angry tenants calling nonstop
• High-cost emergency repairs
• Interrupted cash flow

If the seller won’t repair the roof or offer meaningful concessions, walking away is often the smartest financial decision. A bad roof becomes your problem from day one, and it’s rarely a cheap one.

3. Electrical System Hazards (Fire Risk)

Old or unsafe electrical systems aren’t just expensive to fix; they can be dangerous. During a home inspection, pay close attention to major red flags like:

• Aluminum wiring (1960s-70s homes)
• Cloth-covered wiring
• Overloaded breaker panels
• Exposed wires
• Frequent tripping breakers
• Outdated fuse boxes

Any of these issues can signal a potential fire hazard, and repairs can add up quickly.

Repair or replacement cost:

• Minor repairs: $500-$1,500
• Full rewire: $12,000-$30,000

Master electrician Robert Davis highlights the seriousness of these problems in an article for Popular Mechanics, noting, “An old electrical panel that is past its service life should be a major red flag. Ignoring these could result in safety hazards and huge bills.”

His warning is spot on. If the electrical system is outdated or unsafe, walking away is often the smartest and safest decision.

4. Plumbing Problems, Leaks, or Old Pipes

Plumbing issues can stay hidden for years, silently causing damage behind walls, under floors, or beneath the foundation. By the time you notice the symptoms, the repair cost can be substantial.

Common problems include:

• Mold and mildew
• Soft or rotting floors
• Foundation movement
• Water-damaged drywall
• Flooding or standing water

Major plumbing red flags to watch for:

• Cast iron drain lines (common in pre-1970s homes)
• Polybutylene (PB) piping
• Tree root intrusion into sewer lines
• Slab leaks
• Low water pressure
• Repeated backups or slow drains

These issues often signal a failing plumbing system, not just a one-off repair.

Fixing Costs:

• Re-piping: $8,000-$20,000
• Slab leak: $3,000-$15,000

Because electrical and plumbing systems often age together, a home with one major issue tends to have the other as well. And as Robert Davis points out, overlooking hidden leaks or outdated systems can quickly lead to huge bills and unsafe living conditions.

If the inspection shows systemic plumbing failures, especially in an older home, it may be best to walk away and look for a property that doesn’t come with a long list of future repairs.

5. Extensive Mold or Water Damage

Moisture problems in a home are more than an eyesore; they can signal big, expensive, and sometimes dangerous underlying issues. When water gets into places it shouldn’t, it can lead to structural damage, health risks, and long-term maintenance headaches.

During an inspection, watch for common moisture red flags such as:

• Visible mold in bathrooms, basements, attics, or around HVAC systems
• Water stains on ceilings or walls
• A persistent musty or “wet basement” odor
• Soft or crumbling drywall
• Rotting wood in subfloors, window frames, or joists

These signs often indicate active leaks, poor ventilation, or long-term neglect.

Fixing moisture issues requires not only removing the mold but also repairing the source of the problem. That could mean replacing roofing, repairing plumbing leaks, improving drainage, or installing better ventilation.

Cost for Mold Remediation + Fixing Source:

$5,000 – $30,000+

And depending on the severity, costs can climb even higher when structural elements require replacement.

The health risks also aren’t something to ignore. In a recent webinar on indoor air quality, Dr. Alan Peterson, a toxicologist with the National Institute of Environmental Health Sciences, warned, “Mold is not just a cosmetic issue. Certain types of mold can cause respiratory problems and allergic reactions. Mold exposure can also lead to serious health problems, especially for vulnerable individuals. Extensive mold growth, especially if it is the result of a significant water intrusion event, is a significant red flag during an inspection.”

His insight highlights one important truth: mold issues often run deeper than what you see on the surface.

If mold is widespread or clearly tied to long-term water intrusion, it’s a serious sign of poor maintenance and potentially thousands of dollars in hidden damage. In these cases, walking away may protect both your finances and your health.

6. HVAC System Failure or End-of-Life Units

A failing HVAC system is more than an inconvenience; it’s a major financial hit waiting to happen. Heating and cooling systems play a huge role in the comfort, safety, and long-term operating costs of a home, especially in states with extreme summers or winters.

During your inspection, watch for red flags such as:

• A furnace older than 20 years
• An AC unit older than 15 years
• Rust on the heat exchanger
• No cooling or heating during the inspection
• Weak or uneven airflow
• Strange noises or burning smells
• Poor maintenance history

Older or malfunctioning systems usually mean you’ll be replacing the unit sooner rather than later.

Replacement costs:

• Furnace: $4,000-$9,000
• Air conditioner (condenser + coil): $5,000-$12,000
• Full HVAC system replacement: $12,000-$20,000+

And remember, this is just for one system. Larger homes, multi-level homes, and rental properties may have multiple units, which multiplies the cost quickly.

Beyond replacement costs, a failing HVAC system also means:

• Higher energy bills
• Poor indoor air quality
• Hot/cold spots in the home
• Tenant complaints (for rental properties)
• A higher chance of emergency repairs during extreme weather

If an inspection reveals multiple end-of-life HVAC components or if the system is clearly on its last legs, the total expense may outweigh the value of the property. In those cases, walking away may be the smarter move, especially if the seller refuses to offer credits, repairs, or concessions.

7. Termite Damage or Wood-Destroying Organisms (WDO)

Termites and other wood-destroying organisms are silent destroyers, often causing serious structural damage long before you ever see a sign. In fact, the National Pest Management Association reports that termites cause over $5 billion in property damage every year in the U.S., and most of it isn’t covered by homeowners insurance.

During an inspection, pay attention to these termite or WDO warning signs:

• Soft, crumbling, or damaged wood
• Mud tubes along the foundation or walls
• Visible insects, wings, or droppings
• Sagging or uneven floors
• Wood that sounds hollow when tapped

These problems usually indicate that termites or other pests have been active for a long time. And if they’ve been chewing for years, the damage can extend into joists, support beams, subfloors, and wall framing.

Treating Termites: Cost Breakdown

• Basic treatment: $800 – $2,500
• Major infestation or tenting: $2,500 – $8,000
• Repairing structural damage: $10,000 – $50,000+

If inspectors find active termites, it’s often manageable. But if they uncover structural damage, rotted beams, weakened floors, compromised framing, then you’re dealing with a high-risk property.

In those cases, even with treatment, the repair costs can skyrocket, and you may never fully know the extent of the damage until you start opening walls or floors.

For that reason, if the termite damage is significant, long-term, or structural, it’s usually smart to walk away unless the seller is willing to:

• Treat the infestation
• Pay for structural repairs
• Offer substantial concessions

Even then, some buyers choose to pass. Severe termite damage is one of those problems that tends to get worse the more you look, so trusting your inspector, and your instincts, can save you from a financial headache.

8. Unsafe or Improper DIY renovations

Not every home improvement project is done by a licensed professional, many homeowners take the DIY route. While some small projects are harmless, major DIY renovations can create unsafe conditions, violate building codes, and lead to expensive repairs later. These issues often show up during a home inspection and should never be ignored.

Common DIY red flags include:

• Unpermitted additions (garage conversions, extra rooms, enclosed patios)
• Load-bearing walls removed without proper reinforcement
• Amateur electrical wiring (loose wires, wrong breakers, overloaded circuits)
• Improper plumbing installs (leaks, wrong pipe materials, poor venting)
• Incorrect roof tie-ins that cause leaks or structural weakness
• Homemade structural fixes that don’t meet code

Many of these shortcuts look fine on the surface but cause serious problems later.

These DIY mistakes can lead to:

• Insurance issues – Claims may be denied if the work wasn’t permitted.
• Appraisal problems – Unpermitted areas often don’t count toward square footage.
• Safety concerns – Electrical and structural shortcuts can be dangerous.
• Financing challenges – Some lenders reject homes with unpermitted work.
• Expensive rework – Fixing sloppy DIY jobs often costs more than doing it right the first time.

Even worse, you may not know the full extent of the problem until after you buy the home and start opening walls or ceilings. What looks like a simple fix could turn into thousands of dollars in corrective work.

If the home needs major re-doing: electrical, plumbing, structural, roofing, or foundation repairs, to bring it up to code, it may not be worth the time, cost, or risk. In cases where DIY work affects safety or structural integrity, walking away is often the smart move unless the seller agrees to properly fix the work with licensed professionals and pull the necessary permits.

9. Drainage Problems and Grading Issues

Proper drainage is one of the most important factors in keeping a home structurally sound. When water flows toward the house instead of away from it, you’re looking at a recipe for long-term damage, sometimes hidden, sometimes expensive, and often both.

If your home inspection reveals drainage issues, take them seriously. Poor grading and water accumulation can lead to:

• Basement or crawl space flooding
• Foundation damage or movement
• Long-term moisture and mold problems
• Soil erosion around the structure
• Rotting wood in sill plates or framing

Water is slow but persistent. Even small problems, like improper downspouts, can become major damage over time.

Common Drainage Red Flags:

• Standing water around the foundation after rainfall
• Negative grading (soil slopes toward the house instead of away)
• Downspouts that end too close to the foundation
• Wet, musty, or muddy crawl spaces
• Efflorescence (white mineral stains) on basement walls
• Soggy soil or erosion around the home

These signs often indicate that water has been a problem for years, not days.

Fixing drainage problems varies widely depending on severity. It could be something simple like relocating a downspout, or something major like installing an entire drainage system.

Typical Drainage Fix Costs:

$3,000 – $20,000+ (Though severe foundation-related issues can cost even more.)

If the inspection shows that poor drainage has already affected the foundation, caused structural movement, or led to mold or rot, walking away may be the smartest decision. Drainage issues rarely exist alone; they tend to bring other expensive problems with them.

Unless the seller is willing to invest in correcting the drainage and repairing any resulting structural damage, it’s often best to continue your home search and avoid inheriting a costly, water-related headache.

10. Septic System Problems

If the property has a septic system, problems can be very expensive. Inspection red flags:

• Slow drain
• Foul smell in yard
• Soggy soil near tank
• Failed drain field

Repairs or replacement: $7,000-$25,000+.

Unless you’re buying at a steep discount, it’s safer to walk away.

If the home relies on a septic system, you need to pay extra attention during the inspection. Unlike city sewer lines, septic systems require regular maintenance and can fail without obvious warning signs. When they do fail, repairs are often messy, expensive, and urgent.

A failing septic system isn’t just a plumbing issue; it’s an environmental and health concern. That’s why most inspectors recommend a separate septic inspection done by a licensed specialist.

Common Septic Red Flags to Watch For:

• Slow-draining sinks, tubs, or toilets
• Gurgling sounds in plumbing lines
• Foul odors in the yard or near the drain field
• Soggy or unusually green grass around the tank or drain field
• Backups in toilets or tubs
• Standing water on or near the drain field
• Evidence of recent pumping done suspiciously close to the showing or inspection

These issues often suggest the tank is failing, the drain field is saturated, or the system hasn’t been maintained properly.

Typical Septic Repair or Replacement Costs:

• Minor repairs: $1,000 – $5,000
• Drain field replacement: $7,000 – $20,000+
• Full system replacement: $15,000 – $25,000+

And in tough soil conditions (like clay, rocky soil, or small lots), costs can be significantly higher.

Septic failures also come with long-term risks:

• Strong odors
• Sewage backups
• Contaminated groundwater
• Difficulty reselling the property
• Required system replacement before occupancy

Because of these risks, unless you’re getting a significant discount, buying a home with major septic problems rarely makes financial sense. Most buyers, and many investors, choose to walk away unless the seller fully repairs or replaces the system before closing.

A failing septic system is one of those issues where “hoping for the best” can turn into a very expensive mistake. In most cases, it’s safer to keep looking and find a property with a healthy, well-documented system.

11. Asbestos, Lead Paints, or Hazardous Materials

Older homes, especially those built before 1978, often contain hazardous materials like asbestos, lead-based paints, or other toxic substances. These materials were commonly used decades ago but are now known to pose serious health risks, especially when disturbed during renovations or repairs.

A standard home inspection may flag concerns, but you’ll typically need a specialized environmental inspection to confirm the presence and severity of the hazard.

Common Hazardous Materials Found in Older Homes:

• Asbestos in insulation, floor tiles, popcorn ceilings, ductwork, or pipe wrap
• Lead-based paint on walls, doors, trim, and exterior siding
• Old fuel tanks (abandoned or leaking)
• Vermiculite insulation (often contaminated with asbestos)
• Contaminated soil around older properties

These materials are generally safe if untouched, but the second you remodel, sand, scrape, or cut into them, they become dangerous.

Safety Removal Costs:

• Asbestos abatement: $2,000 – $15,000+
• Lead paint removal or full abatement: $3,000 – $25,000+
• Removal of buried oil tanks: $1,000 – $10,000+

Actual costs depend on how widespread the hazard is, how difficult it is to access, and whether the material has already been disturbed.

Why This Matters for Investors

For property investors, hazardous materials are more than just a safety concern; they’re a budget killer. These costs directly affect:

• Renovation timelines
• Project profitability
• Future tenant safety compliance
• Insurance requirements
• Marketability during resale

A flip or rental rehab can go from profitable to underwater overnight if asbestos or lead abatement becomes necessary. And because these hazards must be removed by licensed professionals, there is no cheap or “DIY workaround.”

If the inspection identifies widespread hazardous materials, especially in areas you plan to renovate; it may be smarter to walk away unless the seller is willing to cover abatement or offer a steep price reduction.

Homes with asbestos or lead aren’t automatically deal-breakers, but the moment removal becomes necessary, the numbers often stop making sense.

12. Major Structural Shifting or Wall Cracks

Structural movement indicates deeper problems. Red flags:

• Horizontal wall cracks
• Bowing basement walls
• Gaps between walls and ceiling
• Detached garage shifting

Repair costs: $10,000-$50,000+

Unless you’re experienced with rehab projects, walk away.

Structural movement is one of the most serious issues a home inspection can uncover. When a house begins shifting, it usually signals deeper problems beneath the surface, often involving the foundation, soil stability, or past water damage.

Common red flags include:

• Horizontal wall cracks (the most dangerous type, often linked to foundation pressure)
• Bowing or leaning basement walls
• Gaps between walls and ceilings
• Doors or windows that suddenly won’t close properly
• A detached or shifting garage structure

These issues aren’t just cosmetic; they’re structural. Fixing them typically requires major interventions like foundation piers, wall anchors, or full structural reinforcement.

Typical repair costs: $10,000–$50,000+

Unless you’re a seasoned real estate investor who specializes in heavy rehabs, this is usually a clear sign to walk away. For most homebuyers and even many investors, structural instability is too risky, too expensive, and too unpredictable.

13. Seller Refuses Repairs, Credits, or Negotiation

Not every inspection issue is a deal-breaker. But a seller who refuses to cooperate can be. Even when the problems aren’t catastrophic, you may need to walk away if the seller:

• Refuses to fix major safety hazards
• Won’t offer repair credits or price adjustments
• Dismisses or minimizes inspection findings
• Insists on a full-price, as-is sale
• Declines even reasonable requests backed by the inspector’s report

This kind of rigidity is a major red flag. A seller unwilling to negotiate often means you’ll be stuck absorbing unexpected costs and future headaches. If a seller refuses to meet you halfway, it’s usually better to step back and find a deal with fewer battles and more transparency.

14. Repairs Exceed your Budget or Cash Flow

A home purchase isn’t just about what you can afford today; it’s about what you can sustain long-term. If the inspection reveals problems that stretch your finances too thin, walking away is simply smart financial management.

You should consider stepping back if the repair costs exceed your:

• Emergency fund
• Renovation or improvement budget
• Projected cash flow (especially for rental properties)

When the numbers don’t work, the deal doesn’t work. Protecting your financial stability is far more important than forcing a purchase that will drain your resources.

15. Your Inspector Recommends Walking Away

A home inspector is one of the few professionals in the transaction who has no financial stake in whether you buy the house. Their job is to give you a clear, unbiased assessment of the property’s condition.

And when a seasoned inspector tells you a home is a bad buy, it’s worth listening.

You should take notice if your inspector says things like:

• “This home needs too much work.”
• “These repairs are extremely expensive.”
• “I’d advise caution moving forward.”
• “If it were my money, I wouldn’t buy this one.”

Inspectors have seen hundreds, sometimes thousands of homes. When they warn you, it’s usually because they’ve spotted patterns that turn into serious and costly problems down the road.

If your inspector recommends walking away, treat it as a major red flag, not just a casual opinion.

What Home Inspection Issues Are Negotiable Instead of Deal Breakers?

While some inspection findings are serious enough to walk away from, many issues are actually normal, especially in older homes, and can be fixed, negotiated, or easily managed. Not every problem means the property is a ticking time bomb.

In fact, according to the American Society of Home Inspectors (ASHI), the average home inspection reveals 2-3 minor to moderate defects, and most of them don’t affect long-term value or structural safety. If anything, they can help you negotiate a better deal.

Below are the types of issues that usually shouldn’t scare you off, as long as the home is priced fairly and the seller is willing to work with you.

1. Cosmetic Problems (Paint, Flooring, Trim, and Fixtures)

Cosmetic defects may look bad, but they don’t affect safety or structural integrity. These includes:

• Scuffed or outdated paint
• Worn-out carpet
• Chipped tiles
• Dated light fixtures
• Dirty walls
• Minor drywalls cracks
• Loose doorknobs

These are expected in a lived-in home and are typically low-cost fixes.

Why it’s not a deal breaker:

You can fix these for a few hundred dollars, or use them to negotiate a better price.

Cost to fix (approx.):

• Interior paint: $1-$3 per sq. ft.
• New carpet: $2,000-$4,000 for most homes
• Light fixtures: $75-$300 each

If you’re an investor, cosmetic updates are often part of your value-add strategy anyway.

2. Minor Electrical and Plumbing Repairs

Not all issues in these systems are major. The following are cheap and easy to repair:

• Loose electrical outlets
• Missing GFCI outlets
• Dripping faucets
• Slow drains
• Running toilets
• Old garbage disposal
• Minor leaks around P-traps

These are extremely common in older homes.

Why it’s not a deal breaker:

Licensed technicians can fix these quickly, usually for under $500.

Negotiation tip:

Ask the seller to repair or offer a small credit.

3. Older (But Working) HVAC System

Many inspection reports note “HVAC nearing the end of its life.” This sounds scary, but it’s often routine.

If the system is performing well, it’s not a reason to walk away, especially it:

• It cools/warms properly
• Airflow is good
• No refrigerant leaks
• No loud noises
• Filter is clean

Typical lifespan:

• AC: 12-15 years
• Furnace: 15-20 years

Why it’s not a deal breaker:

A functioning system still has a life left, and you may get a home warranty to cover future repairs.

Negotiation tips:

Ask the seller for a 1-year home warranty ($500-$700), which usually covers HVAC repairs.

4. Roof With Minor Wear or Small Repairs Needed

A roof doesn’t have to be new to be acceptable.

• Fixable roof issues:
• Missing shingles
• Minor sagging
• Small leaks
• Worn flashing
• Aging roof materials that aren’t failing yet

Why it’s not a deal breaker:

These repairs are usually low-cost ($200-$1,000), and sellers often agree to fix them before closing.
If the roof still has 3-10 years of life, it’s usually safe to proceed.

5. Normal Wear and Tear in Older Homes

If you’re buying a home older than 15-20 years, expect:

• Slight window fogging
• Stiff doors from settling
• Minor siding damage
• Weathered caulking

None of these issues affect safety or long-term property value.

How to Know Whether to Walk Away or Negotiate After a Home Inspection

Deciding what to do after a home inspection can feel overwhelming, especially if the report is 40-70 pages long. But not every issue deserves panic. Some require negotiation, some need quick repairs, and a few are serious deal-breakers.

To make things easier, use this simple five-step decision framework. It works for:

• First-time homebuyers
• Property owners
• Real estate investors
• Out-of-state buyers
• Anyone looking at older or fixer-upper homes

Let’s break it down.

Step 1: Separate Safety Issues From Non-Safety Issues

Before anything else, determine whether the issue is dangerous or simply inconvenient.

Major Safety Red Flags (Often Worth Walking Away)

These problems can threaten life safety or structural integrity:

• Structural movement or foundation failure
• Active roof leaks or structural roof damage
• Significant electrical hazards
• Active mold growth
• Asbestos or lead paint risks (especially if disturbed)
• Severe water intrusion
• Major plumbing failure (e.g., cast iron collapse)
• Termite damage that compromises framing

If the inspector flags an issue as unsafe, it deserves serious consideration.

Why it matters:

Safety repairs are often expensive, and insurance companies may decline coverage until they’re fixed.

If the seller refuses to address them, walking away is usually the smartest financial decision.

Step 2: Estimate the Real Repair Costs (Not Guesswork)

Many buyers overestimate repair costs because the report sounds intimidating.

Instead, get real numbers by using:

• The inspection report
• Contractor quotes
• Online cost estimators (HomeAdvisor, Angi, Fixr)
• Local service providers
• Property managers (investor buyers often use this option)

Rule of Thumb:

If repairs cost 10-20% of the purchase price, the deal might not be worth it.

Example:

• Home price: $250,000
• 10-20%: $25,000-$50,000

If your repair list crosses that threshold, it’s time to reevaluate, unless you’re buying a deep-value property.

Step 3: Negotiate Before Making Any Final Decision

Most buyers walk away too early.

In many cases, sellers are willing to:

• Offer repair credits at closing
• Reduce the purchase price
• Fix issues before closing
• Replace appliances or HVAC components
• Install safety upgrades (GFCIs, new smoke detectors, roof patching)

Sellers expect negotiations after inspections, especially in balanced or buyer-friendly markets.

Why negotiation matters:

A reasonable seller may easily cover thousands in repairs, saving you from leaving a good property.

Investor tip:

Credits at closing often provide better ROI than asking for repairs. You control the work quality yourself.

Step 4: Look at Long-Term ROI (Especially for Investors)

Even if repairs are manageable now, they might impact your long-term financial picture.

Questions to ask:

Will repairs destroy cash flow?

If fixing issues pushes rent returns below your target cap rate, reconsider.

Will repairs delay leasing or move-in?

If you need 2-3 months of work, your holding costs jump.

Will insurance premiums increase?

Homes with older wiring, roofs, or plumbing often face higher premiums.

Does the property still meet your overall investment strategy?

If the house no longer aligns with your goals, walking away may protect your future returns.

For primary homebuyers, ask:

• Can you emotionally and financially handle the repairs?
• Does the home still feel worth it compared to alternatives?

Step 5: Don’t Ignore Your Inspection Contingency Timeline

Most real estate contracts give buyers 7-10 days to:

• Review the inspection
• Request repairs
• Renegotiate
• Cancel the contract without penalty
• After that deadline passes, backing out may cost you your earnest money deposit.

What to do immediately after receiving the report:

• What to do immediately after receiving the report:
• Read the summary section first
• Flag all safety or structural issues
• Ask your agent which items are negotiable
• Schedule quotes ASAP
• Submit your repair/credit request before the deadline

Do not wait until the last day, that’s how buyers lose leverage.

How to Back Out After Inspection the Right Way

If you decide to terminate the contract, follow these steps:

• Notify your agent immediately.
• Send written notice based on your inspection contingency.
• Request a refund of your earnest money.
• Save your inspection report for future property comparison.
• Walk away cleanly and start fresh.

Most buyers receive their earnest money back if they cancel within the inspection period.

Trust the Inspection, and Trust Your Gut

A home inspection protects you from major financial mistakes. If the home has serious structural issues, safety hazards, or a seller who won’t work with you, it’s often smarter to walk away than to push forward.
But you don’t have to make the decision alone.

If you’re buying a home in Oklahoma City, Edmond, Moore, Yukon, Midwest City, or Norman, an expert can help you understand what’s normal, and what’s a true red flag.

OKC Home Realty Services has helped homebuyers and investors avoid bad deals, read inspection reports, and negotiate smarter.

Need help deciding if you should walk away from a home inspection?

Reach out to OKC Home Realty Services today. We’ll help you protect your investment and make the right move with confidence.