Home Inspection Revisited

I have written on this topic before, but there have been some changes since last we visited the subject, so it is probably worth retracing the ground. No doubt the primary concern of a purchaser of resale property is the condition of the property and the possibility of an unknown defect. This is not to say that we are looking for concealments or seller misrepresentations, as it is quite possible that the sellers could be living with defects of which they are not even aware.

The first step is to locate a property that you like well enough to begin negotiations. Next, should be the selection of a reputable home inspector. We have come a long way since the days in which anyone with a screwdriver and a pick-up truck could perform inspections. Today, there are several fine inspection firms from which to choose. One only needs to rely on a recommendation from your real estate professional. He should be able to help direct you to a reliable company. Unfortunately, inspectors are still not licensed in Pennsylvania, only privately certified, even though a poor inspection could possibly do more damage to you, than poor performance on the part of your licensed realtor or your licensed plumber. That being said, you need to do your due diligence when making a selection. I prefer inspectors who have actually worked in the construction trades. Remember, this inspector is going to make judgments about your roof, electrical system, plumbing system, heating system, structural integrity, etc; trying to paint you a general picture of your new home. That’s a lot to expect from someone. He needs to be a generalist with an understanding of building codes and standards. The last thing you need is an inspector that recommends additional inspections. In effect, what he is saying is that he doesn’t understand all aspects of all building systems enough to make a complete assessment and that you may need to have a specialist take a second look. If that’s to be the case, forget the inspector and hire the specialist from the start. I’m not suggesting that your inspector needs to be an expert in all things, but has to have enough expertise to recognize when something appears to be wrong. A common situation is one in which the inspector sees something he doesn’t like in the heat exchanger of a forced air furnace. Under these circumstances, it is acceptable for the inspector to suggest that you have a heating contractor comment on the extent of the problem and possible remedies.

Understand the purpose isn’t to obtain information with which to reopen negotiations. Readily observable defects should have been part of the original negotiation. For instance, you observe several fogged up thermo-pane windows. You know that these windows will have to be repaired or replaced. They should have been considered as part of your original negotiations. The purpose of the inspection is to find things you wouldn’t be able to see readily, perhaps something electrical going on in the circuit box or some defect in the inner workings of your forced air furnace. When these deficiencies are noted, you can then ask the seller for assistance in the correction. At that point, they may refuse or agree. If they agree, the transaction moves forward. If they refuse, you’ll have to decide whether or not to continue with the transaction.

I guess this is where I get on my soapbox. Far too often home inspections are used inappropriately, to renegotiate a sale, even though making the inspector’s required repair improves the property beyond what you had a right to expect. For example, let’s return to that furnace I mentioned earlier. Suppose the furnace contractor returns with the opinion that the furnace should be replaced. Using the inspection like a hammer, you demand that the sellers replace the furnace or there is no deal. That is just patently unfair; although, according to the inspection clause within your sales agreement, you are within your rights. When you negotiated your purchase, it was based on the fact that you had a used furnace. Now, you expect a new one at the same price or the deal is off. Fairness would dictate that you agree to bear at least a portion of that unexpected expense. Yet, I have seen numerous instances where the buyer demanded that the seller make the improvement, “or else,” and the sellers agree simply because they do not wish to return to square-one in the marketing of their home. Though, by doing so, they may have been able to recoup some of the expense.

So, here is where I float my idea, which originally seemed to some to be unworkable. Sellers should have their homes inspected when they list them. The cost could be built into the price. In this way, the seller would know what repairs would be expected and could either choose to make them or not, and negotiate accordingly, having fully disclosed all conditions to the buyer.

This is where I generally encounter resistance. I am told that buyers will never want to accept a seller’s inspection. I submit to critics of the idea that this is not the seller’s inspection, but an inspection performed by an independent inspection service that could very likely be the same company a buyer would select on their own. There is no reason for an inspector to do an inspection that benefits the seller; they remain liable for their work. Buyers may actually appreciate the idea, as it saves them an out-of-pocket expense of about $400. And then, negotiations could be conducted with full knowledge of the property. I think it make sense. What about you?

Gary Straub is an independent real estate consultant and real estate professional for 36 years.