Reader Question: You have written numerous articles over time about different problems with home inspections. We are near our savings goal and preparing to buy a home. What is your current opinion of home inspections?
Monty’s Answer: Home inspection laws came into existence because home sellers were unaware of the defects, hid or made inadequate repairs to get the best home price. Homebuyers called for regulation to protect themselves from buying homes with such defects. My state defines “defects” in the statutes. Here is a link to the definition (https://bit.ly/3eeQN4h). It may surprise you.
Are home inspections a good idea?
The concept of a home inspection is an excellent idea. A proper home inspection by a trained individual on inspecting a home has several advantages over other options.
The weaknesses in the industry
Some weaknesses or flaws can be difficult for a home buyer to discover when choosing a home inspector. Like many service providers in the real estate industry, home inspectors are not all created equal. Here is a link to a column on “How to hire a home inspector (https://bit.ly/3xKYnvl).”
Over the past 30 years, the inspection industry has evolved. I believe some home inspectors have unwittingly muted the value of a good home inspection to gain a competitive edge. Here are some examples:
- Some are so afraid of litigation they constantly suggest consulting a technician with particular expertise. Suppose the inspector is calling to consult a roofer, a plumber, an electrician and an HVAC contractor. They can certainly reduce their potential liability. And lessen the inspection’s value.
- Some dilute the value of the inspection by turning a nine-page inspection into a 30-page maintenance service manual. So instead of a report that specifically calls out the unsafe components or the material adverse facts, they go way beyond with potential maintenance items that may not appear for years. While many homebuyers like this information, in my experience, this type of inspection creates unnecessary confusion and concern to make the inspector look good and the house look bad. Most buyers know homes wear out. They only want assurance that there are no hidden surprises. My home state recently updated the law to make it mandatory for an inspector to use the word “defect” when calling out a defect.
- The inspector population is aging. Hearing, sense of smell and eyesight tends to diminish as we age. Physically climbing around in the attic or going up on the roof can create an urge to take shortcuts. Aging is a factor because inspections are in-person visual observations only. It is no wonder drones are becoming popular in the home inspection industry.
The current practice of delaying the inspection until they secure a buyer is a weakness. The real estate industry, not the inspector, is the culprit here. A minor shift in the practice would allow the seller to disclose, replace, or repair defects upfront. It also gives the seller time to take care of such issues without the anxiety of having a short window of time before the closing that occurs with an after-the-fact inspection. The condition of a home also contributes to the market value, so knowing more about the house before setting the price is logical.
Richard Montgomery is the author of “House Money – An Insider’s Secrets to Saving Thousands When You Buy or Sell a Home.” He advocates industry reform and offers readers unbiased real estate advice. Follow him on Twitter at @dearmonty, or at DearMonty.com.
