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VOL. 35 | NO. 22 | Friday, June 3, 2011

Let common sense prevail at inspection time

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The home inspection is possibly the most critical component of any residential real estate transaction. Additionally, it is the most controversial.

Naturally, any home buyer should be aware of all of the aspects of the property as the purchase is, in most cases, the largest financial investment by far that the person will ever make.

An inspection should literally be nuts-and-bolts, objective review of inanimate objects such as wiring, plumbing, ductwork, bricks, mortar, some drywall, maybe even some plaster thrown in for good measure. The house is not alive.

Unfortunately, with the passion and emotion involved in a home purchase, tensions run high and words are often misinterpreted or, perhaps, misspoken.

Inspectors are as oft quoted as prophets and their words register with buyers as if they were the words of God. As the process goes on, the seller is often cast in the role of Satan.

Unlike Satan, the sellers were not banished from paradise, nor do they tempt innocent people to sin so that they are damned to spend an eternity in Hades. After many inspections, it is the seller that is exiled into the purgatory until such time that the numerous deficiencies of the home can be cured.

The process would be less difficult if a bit of common sense and reason could prevail. Not likely. By the time of the inspection, the lines have been drawn in the sand, and the skirmish has escalated into a full blown war.

The buyers have beaten the seller to death on the price, citing every shortcoming of the home and deducting tens if not hundreds of thousands of dollars from the price. When the inspector finishes, the buyers will deduct the same tens of thousands for the same failings.

Back to the common sense plea. Many times an inspector will have a ‘eureka!” moment wherein they hit the mother lode – a smoldering electrical panel or a pipe spewing water. Good inspectors, and there are more now than ever before, will calmly administer first aid to the house’s wound, perhaps saving it.

Others will grandstand, denigrating the homeowner for allowing such a situation to occur and reminding the buyers how fortunate they are that he rescued them from this atrocity. Never mind that the homeowner has lived there for 10 years and has four children under the age of 15 living in the home.

It is unlikely that the seller is perpetrating a fraud to dupe a buyer into buying a time bomb all the while exposing their beloved family to catastrophic consequences. The seller didn’t know.

“Was this in the property disclosure?”

“Oh yes. It says right here, ‘the house will probably explode from a gas leak any minute.’”

“Should have been any second.”

Seconds, minutes, amps, volts, water pressure, whatever. Any problem in any hoe can be repaired. It’s a matter of money. And, quite frankly, the chronology of events of the home buying process places even more emphasis on the inspection phase.

By the time of the inspection, the home has been off of the market for a number of days, losing any sales momentum it may have gained. In most situations, the seller has found and contracted to buy another home.

Psychologically, harmony prevailed when the Realtor, the inspector, and the buyer walked into the home. Now, chaos, doubt and distrust are creeping in. The home the buyers loved has been insulted and belittled. The cute little seller has grown horns and wields a pitchfork.

In this market, more so than in the past, buyers are walking, i.e., terminating the contract following the inspection. With this in mind, sellers should be more open to repairs than they may have been in the past.

Four years ago, if a person found a house and contracted to buy it, asking for extensive repairs was not an option as there were more buyers than sellers. Today, the converse rings true. Buyers are not concerned with their abilities to locate another suitable home. They will leave and not look back.

In the recent past, most sellers have realized, or been made aware of this trend – not a conspiracy, merely a trend – toward the buyer’s market. So they take their lumps, move on and find their next home.

With unbridled glee, they welcome their home inspection anticipating wreaking similar carnage on their sellers. After the completion of the inspection, they await the report, thrilled at the prospect of making similar demands that were made to them.

“Good news!” the inspector proclaims. “Clean as a whistle.”

“What!?” the buyer bemoan. “That can’t be.”

“Wouldn’t touch a thing.”

Richard Courtney is a broker with Pilkerton Realtors and the author of Come Together: the Business Wisdom of the Beatles and can be reached at Richard@RichardCourtney.com.

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