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|The Home Inspection Process|
|Nationwide, studies many years ago have shown the average home inspection turns up more than $2,500 worth of reportable deficiencies. The vast majority of homes exceed that today on an order of magnitude, and quite frequently are well north of $10,000 in needed repairs (with just a simple roof replacement costing that much or more).
If you wish to have the seller repair some items or wish to pursue a reduction in price, you must inform the seller in writing that the inspection is disapproved, but will be approved "under the following conditions". Then request whatever you wish to negotiate be it price reduction, closing costs, repairs, or a combination thereof.
Lately in this crazy up and down market, multiple offers to buy a single home have become common. In these cases "pre-inspections" are common, where the home is inspected by numerous buyers prior to submitting an offer and the buyer adjusts their offer accordingly.
|New homes makes up about 30% of inspection requests. But didn't the municipal inspector just get through looking at the building? Yes, but they spend mere moments on their inspections, don't look closely at flashing and siding issues, the roof, workmanship issues, trade responsibility overlaps, the crawlspace, the attic, etc. They are looking only for immediate life safety items. New construction inspections are quite honestly more valuable to the consumer than inspections performed on older homes, since virtually 100% of the defects are repaired at no cost by the builder, with no further bargaining necessary. |
This information may be hard to believe or conceptualize coming from a home inspection company, but generally pre-listing inspections are discouraged, except in the case of absentee landlords and so forth. Some real estate agents try to pursuade people to get their home inspected prior to putting it on the market. They feel the more you know about the home the better off you and the buyer will be. While there is truth in that well-meaning sentiment, given the disclosure laws in the state of Washington a complete pre-listing inspection will only serve to hurt the seller financially and at increased risk of litigation.
Why? As a seller you are required to divulge everything you are aware of that is defective in your home. And I fully condone this. This should be done completely and fully to the best of your knowledge. However, nowhere is there a requirement to actually hire a professional to find defects before you sell. This increases your liability by increasing your standard of care and reporting, clouds the concept of "actual knowledge", and shifts the burden of discovering defects from the buyer to the seller. Don't do it. "Defects" are very subjective and everyone has a different idea of "acceptable". This will only lead to disappointments. I see it happen all the time. Call when you want to buy.
If you have concerns with a few items, such as with a roof or furnace before putting a home on the market, please call, then these items can be inspected individually, without the need for a "complete inspection" and its ensuing complications.
Buying a condominium involves buying a portion of an association of owners. You own a portion of whatever problems the entire association owns. Unfortunately literally thousands of local condo owners have been stuck with huge unexpected assessments from their associations for repairs to the exterior of their buildings due to lack of maintenance, faulty materials, or shoddy original design and construction, most notably buildings built between 1990 and 2003 (this has to do with state law changes).
So what do most inspection companies do? They completely exclude the exterior portion of the building for "liability" reasons. The inspection industry unfortunately is paranoid of lawsuits and this reasoning drives their business practices, which directly hurt the consumer. The exterior inspection is the most critical part of a condo since there is such little direct control over it. Obviously the entire exterior cannot be part of an inspection, but a cursory and informal overview of the exterior maintenance and construction is always included in our inspections. Will it turn up all problems? No way, but it will sure give an idea of the risk potential. And at the end of the day that is what is important to the buyer. The reserve study, a new requirement for associations is now generally included with the resale certificate when purchasing a condo. Be sure to study this document, bring it to the inspection if you have received it, and we can study it together.
Converting apartments to condos was quite the money making trend only a few years ago. And then many of them were converted back to apartments in order to provide some revenue. But conversions are still out there. Problem is most potential homebuyers are not aware that since the building was not built new as a condo, it does not fall under the warranty requirements, third party progress inspections, and financial protections mandated under the state's comprehensive 2003 condo law (passed by the legislature in response to burned consumers and associations, the plethora of lawsuits, crappy construction, and lack of available insurance for developers).
Typically the conversion developer will buy an apartment building, hire an engineer to go through and make repair recommendations both inside and out. There is no requirement to make these repairs, and believe it or not a good percentage of the recommendations are not actually performed. The municipal building department or county is also called in and requires upgrades to meet current code on important life safety equipment such as deck rails, smoke detectors, and so forth.
Next the Public Offering Statement (POS) is developed (this is a conversion's version of the resale certificate). The POS contains the engineer's report, the municipal upgrades and permits, the developer's response and actions regarding the engineer's report, and all the financial legalities required to set the owner's association in motion. It is one LARGE book, but must be studied, particularly the part where the developer notes where they did or did not perform the recommended repairs. Verification of these repairs is the most important part of a conversion inspection actually, just like the resale certificate/reserve study is on a used condo. While the countertops may glisten, and the carpet and appliances are new, many seriously lame and leaking siding and decks can and do remain.
For a particularly scary story click here: http://seattletimes.nwsource.com/html/localnews/2012845701_riverwalk09m.html
|Report Formats & Pricing|
|Along with advice on how to solve existing problems and preventive maintenance tips, the end product of an inspection is a written report, one of several types available. Why do we do different types when other inspection companies offer a one-size-fits-all? Every person, every building, and every situation is different:|
Customized Report (The Big Dog)
|Some of the Things We Check|
The following isn't an exhaustive list, but illustrates just how many things are inspected during a typical job. The industry is beginning to standardize after all these years, due to required state standards and association standards aligning.
|What Our Inspections Include|
Ladders and flashlights, screwdrivers, electrical test instruments, meters, protective suits, kneepads and respirators, gloves and spiked shoes are the basic weapons used in home inspections. Of course high tech tools can be used when necessary, but are sometimes oversold by this industry to impress. Good old fashioned inspecting, aided by years of experience trumps high tech every day. That being said, Darrell has an infrared scanner, a pinless moisture meter, and a digital carbon monoxide detector at his disposal when indicated.
Indoor Air Quality (IAQ)
Indoor air quality is a huge concern in newer "tighter" homes built since the middle 1980's, with mold, VOC's from chemicals/contaminants and formaldehyde all potentially damaging to health. Formaldehyde is of particular concern in brand new homes as it takes time for outgassing to occur from new building materials and furnishings. Unlike mold, formaldehyde has specific measurable exposure standards set by government health organizations (NIOSH says no higher than 16 parts per billion in the workplace, so in a home where more time is spent, the action level is 5 ppb).
Mold spores are all around us and in all air indoors and out,so testing for spores doesn't provide much useful information, however testing for mold VOC's (MVOC) can show active mold growth in the home, not just background spores. Knowing that you have spores doesn't do any good, but knowing about growth is useful information. This testing can indicate mold growth that is not yet detectable by smell, not necessarily visible, nor likely to be picked up by background spore checks or thermal imaging (infrared camera), with no wall drilling or carpet removal required. This technology is extremely encouraging because it can find health hazards that would otherwise go undetected. VOC checks can also detect sulfur in Chinese drywall (mostly a problem in SE USA, and generally in years 2006 and 2007 construction) and hundreds of other chemicals that can cause ilness.
Darrell is certified as a Home Air Check Professional by Prism Analytical. Either of two separate air quality checks (MVOC--active mold growth / VOC---hazardous chemicals or a separate formaldehyde test) can be performed, using proprietary air dosing/sampling equipment. The test takes approximately 2.5 hours and is done only in conjunction with a home inspection. Lab testing and analysis is provided by Prism Analytical www.homeaircheck.com Cost: $195 per test.
While a home inspection is not an asbestos survey, there are many suspected building products that homeowners may want to have tested for asbestos content. Several can be readily visually identified. The most common are "cottage cheese" ceilings and white heat duct tape. As a courtesy to customers while on the job site Darrell can take a sample and have it tested by a local lab specializing in this material, Asbesto-Test. Cost: $85 per sample.
A new law has just come into effect in 2011 where all buildings built 1978 and older MUST have lead paint testing before sanding can begin. This has obviously increased the need for lead paint testing during home inspection. There are several different levels of lead paint testing, ranging from simple lead test kits to Xray testing. Darrell can sample and take paint chips to the lab for chemical testing upon request. $50 per sample.
This business did not even exist fifteen years ago but it has become invaluable to the potential buyer of older homes, saving thousands of homeowners untold headaches. Highly recommended and generally about $250. Many plumbing companies do this, but I recommend an independent, which eliminates the potential for conflict of interest. Please call for referrals.
|How a Home Inspection Differs from Other Inspections|
|Follow The Money|
|A Word About E&O Insurance|
Many inspection companies like to tout the fact that they carry E&O insurance (errors and omissions). E&O is presented to the public as an insurance policy for their benefit in case the inspector had a bad day and forgot to notice that the roof was missing or some other horrible nightmare.
But I wouldn't have E&O insurance if you gave it to me for free!
The cold hard truth is that E&O insurance is bought by inspectors to protect their assets. It's not purchased out of the goodness of their hearts or for their customer's benefit. For the real truth in just about anything in life, follow the money!! E&O benefitting the customer does not exist. This is a nasty lie that this industry tells its potential customers.
Let's say your inspector screws up. Go ahead, I dare you, call the insurance company and ask them to give you $7500 for a new roof. Won't happen. This isn't like a fender bender in the parking lot folks. You'll be forced to sue. You may win in court, or you may not. But you will invest at least $20,000, and more than a year of your life getting there. The insured inspector is not allowed to settle with you, since his insurance company has now taken charge of the claim.
Inspector E&O policies have about a $5000 yearly premium, and, to make the math easy, a $5000 deductible. So any claim will cost the inspector 10 grand after all is said and done. Plus he will have one supremely PO'ed client who will be bad-mouthing him up one side and down the other to anyone that will listen. Doesn't seem the best business policy now does it?
Is there another way?
Let's say this same inspector pocketed the 10 grand he would have spent on insurance and deductible and simply put it in the bank, never handing it to the insurance company. Further suppose this same customer calls up the uninsured inspector and says, "that roof you forgot to look at last week----it never existed". Rather than the inspector saying "call my insurance company and good luck Chuck", followed by the insurance carrier responding with, "sue us", in a different world what if the inspector said...."Oh my gosh, I screwed up. Please take this $7500 and my profound apologies". See the difference?
Inspector is $2500 richer (each year), customer is happy as a clam, and tells everyone what a standup guy he is. They call this a win-win. Is it a warranty? No, it's a business philosophy based on trust and experience, not fear.
So your next question is, Darrell have you ever paid anyone? Nope. Never had the need to.
Safe & Sound Home Inspections, Seattle Area Home Inspections by Darrell Hay, 206 226 3205 firstname.lastname@example.org
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