Last month, I wrote "What Is A Home Inspection?" I fully intended to write more … but I didn't.
Then Jay Thompson in Phoenix wrote about the home inspection from the Seller's point of view. I think he wrote it better than I could.
The seller should be looking at the inspection in much the same way as the buyer is:
"A home inspection for the purposes of this Contract is RESTRICTED TO DETERMINING ONLY that the plumbing (including well, well pump and septic systems, if any), heating, air conditioning (if any), electrical systems and appliances are in safe working order, there are no structural defects, and the roof is free of leaks. The home inspection and any subsequent inspections shall be at Purchaser's expense."
In our area of Virginia, if you agree in whole or in part to the repairs requested in the home inspection Amendment, make sure there is a completely ratified (signed and initialed) Amendment. The home inspection contingency is then removed and you can move forward with the Contract. As a seller, you want to make sure there's a specific dollar amount specified for repairs (it varies on what that amount is, sometimes as little as $500, but the Contract should state very clearly what that amount is. If you can't come to an agreement with the buyer regarding which repairs will be completed, then the Contract can be terminated (again, in writing), the buyer can get their earnest money back, and your house can be put back up for sale.
I can't say that we see many deals fall through over home inspections, but sometimes negotiations just don't work out as planned and the house has to go back on the market. Remember – if one buyer didn't like that the roof was falling apart, it's probably that another buyer's not going to like that either. If you can make some of the repairs suggested in the report prior to putting the house back up for sale, it might be a good idea. Another even better idea might be to have the house inspected prior to listing it; then you can provide potential buyers a little more confidence that yours is one they need to seriously consider.
Thanks Jay, for the great write-up.
Bob, thanks for the comment – your expertise on this blog is much appreciated!
It seems that one of the reasons why the home inspection clause states the scope of the inspection is to create a clear expectation of responsibility among buyer, seller, real estate agents, inspectors, etc. Failure to set clear expectations among one or more of the parties involved in the inspection is one of the biggest problems I see arise out of the process. And when a Contract goes to mediation or court, the first thing that’s going to be asked is “what does the Contract say?”
• Jeremy, I’m not sure why you included “inspectors” with this group, because the inspector is not a party to the purchase contract. The scope of the inspection is determined by the standards of practice that the inspector follows, and possibly the requirements of the inspector’s insurance carrier. The home inspection clause is certainly as important as every other clause in the purchase contract, but it’s not important to the inspector.
For this reason, I think the home inspection clause is good to have and should be referred back to. Certainly a report should be as detailed as possible – parties to the transaction need to have as accurate a snapshot as possible regarding the home; as you said, although the buyer pays for the inspection, it’s in the seller’s best interest to have the best inspector possible, as well.
Where we likely disagree is regarding the fact that a detailed inspection is not free reign to expect items outside the scope of that inspection to be used as a way to force action or further concessions on the part of the seller. Well, perhaps it’s not so much that we’d disagree on that point, that’s probably not fair to say.
• We don’t agree or disagree, because I have no interest in the manner in which the information I provide is used. I infer from your statement that you see a home inspector as an advocate for the people who contract for his inspection services, but that is not the case. For any given house, my report would be the same if I was doing a pre-listing inspection for the seller of a pre-purchase inspection for a buyer.
I’m sure someone could read that and say “well, he doesn’t get paid unless the transaction happens, so he’s going to do everything he can to make it go through.” WRONG. Blacksburg is a small Town; I will hold my head high, and hopefully share a few laughs, when I cross paths with my former clients, and I’ll be able to do that because I’ll know I did the right thing. I have an obligation to represent my client’s best interests, to the best of my understanding as to what they are, and attempting to make items not within the scope of the transaction part of the transaction isn’t in anyone’s best interest, I think.
• I think everyone understands that a real estate agent has an obligation to represent the best interests of his clients. I’m not sure that everyone understands that a home inspector has an obligation to provide accurate information that meets the requirements of the inspection contract, regardless of the provisions in the purchase contract.
Apologies, Bob, if this rambled a bit. I’ve been running all over the New River Valley the last day or so, and am even in Roanoke today, but wanted to make sure I responded this afternoon.
• No apologies necessary. I did inspections in Christiansburg, Radford, and Huntersville, NC in the last few days. I understand completely the ever-dwindling number of hours in a day.
Bob, thanks for the comment – your expertise on this blog is much appreciated!
It seems that one of the reasons why the home inspection clause states the scope of the inspection is to create a clear expectation of responsibility among buyer, seller, real estate agents, inspectors, etc. Failure to set clear expectations among one or more of the parties involved in the inspection is one of the biggest problems I see arise out of the process. And when a Contract goes to mediation or court, the first thing that’s going to be asked is “what does the Contract say?”
• Jeremy, I’m not sure why you included “inspectors” with this group, because the inspector is not a party to the purchase contract. The scope of the inspection is determined by the standards of practice that the inspector follows, and possibly the requirements of the inspector’s insurance carrier. The home inspection clause is certainly as important as every other clause in the purchase contract, but it’s not important to the inspector.
For this reason, I think the home inspection clause is good to have and should be referred back to. Certainly a report should be as detailed as possible – parties to the transaction need to have as accurate a snapshot as possible regarding the home; as you said, although the buyer pays for the inspection, it’s in the seller’s best interest to have the best inspector possible, as well.
Where we likely disagree is regarding the fact that a detailed inspection is not free reign to expect items outside the scope of that inspection to be used as a way to force action or further concessions on the part of the seller. Well, perhaps it’s not so much that we’d disagree on that point, that’s probably not fair to say.
• We don’t agree or disagree, because I have no interest in the manner in which the information I provide is used. I infer from your statement that you see a home inspector as an advocate for the people who contract for his inspection services, but that is not the case. For any given house, my report would be the same if I was doing a pre-listing inspection for the seller of a pre-purchase inspection for a buyer.
I’m sure someone could read that and say “well, he doesn’t get paid unless the transaction happens, so he’s going to do everything he can to make it go through.” WRONG. Blacksburg is a small Town; I will hold my head high, and hopefully share a few laughs, when I cross paths with my former clients, and I’ll be able to do that because I’ll know I did the right thing. I have an obligation to represent my client’s best interests, to the best of my understanding as to what they are, and attempting to make items not within the scope of the transaction part of the transaction isn’t in anyone’s best interest, I think.
• I think everyone understands that a real estate agent has an obligation to represent the best interests of his clients. I’m not sure that everyone understands that a home inspector has an obligation to provide accurate information that meets the requirements of the inspection contract, regardless of the provisions in the purchase contract.
Apologies, Bob, if this rambled a bit. I’ve been running all over the New River Valley the last day or so, and am even in Roanoke today, but wanted to make sure I responded this afternoon.
• No apologies necessary. I did inspections in Christiansburg, Radford, and Huntersville, NC in the last few days. I understand completely the ever-dwindling number of hours in a day.
Bob, thanks for the comment – your expertise on this blog is much appreciated!
It seems that one of the reasons why the home inspection clause states the scope of the inspection is to create a clear expectation of responsibility among buyer, seller, real estate agents, inspectors, etc. Failure to set clear expectations among one or more of the parties involved in the inspection is one of the biggest problems I see arise out of the process. And when a Contract goes to mediation or court, the first thing that’s going to be asked is “what does the Contract say?”
For this reason, I think the home inspection clause is good to have and should be referred back to. Certainly a report should be as detailed as possible – parties to the transaction need to have as accurate a snapshot as possible regarding the home; as you said, although the buyer pays for the inspection, it’s in the seller’s best interest to have the best inspector possible, as well.
Where we likely disagree is regarding the fact that a detailed inspection is not free reign to expect items outside the scope of that inspection to be used as a way to force action or further concessions on the part of the seller. Well, perhaps it’s not so much that we’d disagree on that point, that’s probably not fair to say. I’m sure someone could read that and say “well, he doesn’t get paid unless the transaction happens, so he’s going to do everything he can to make it go through.” WRONG. Blacksburg is a small Town; I will hold my head high, and hopefully share a few laughs, when I cross paths with my former clients, and I’ll be able to do that because I’ll know I did the right thing. I have an obligation to represent my client’s best interests, to the best of my understanding as to what they are, and attempting to make items not within the scope of the transaction part of the transaction isn’t in anyone’s best interest, I think.
Apologies, Bob, if this rambled a bit. I’ve been running all over the New River Valley the last day or so, and am even in Roanoke today, but wanted to make sure I responded this afternoon.
Bob, thanks for the comment – your expertise on this blog is much appreciated!
It seems that one of the reasons why the home inspection clause states the scope of the inspection is to create a clear expectation of responsibility among buyer, seller, real estate agents, inspectors, etc. Failure to set clear expectations among one or more of the parties involved in the inspection is one of the biggest problems I see arise out of the process. And when a Contract goes to mediation or court, the first thing that’s going to be asked is “what does the Contract say?”
For this reason, I think the home inspection clause is good to have and should be referred back to. Certainly a report should be as detailed as possible – parties to the transaction need to have as accurate a snapshot as possible regarding the home; as you said, although the buyer pays for the inspection, it’s in the seller’s best interest to have the best inspector possible, as well.
Where we likely disagree is regarding the fact that a detailed inspection is not free reign to expect items outside the scope of that inspection to be used as a way to force action or further concessions on the part of the seller. Well, perhaps it’s not so much that we’d disagree on that point, that’s probably not fair to say. I’m sure someone could read that and say “well, he doesn’t get paid unless the transaction happens, so he’s going to do everything he can to make it go through.” WRONG. Blacksburg is a small Town; I will hold my head high, and hopefully share a few laughs, when I cross paths with my former clients, and I’ll be able to do that because I’ll know I did the right thing. I have an obligation to represent my client’s best interests, to the best of my understanding as to what they are, and attempting to make items not within the scope of the transaction part of the transaction isn’t in anyone’s best interest, I think.
Apologies, Bob, if this rambled a bit. I’ve been running all over the New River Valley the last day or so, and am even in Roanoke today, but wanted to make sure I responded this afternoon.
The answer to the question “what is a home inspection?” will depend on to whom the question is asked.
A real estate agent may respond that the purchase contract defines the purpose and limitations of the home inspection, but that’s not altogether correct. The purchase contract merely defines which parts of the home inspection report apply to the transaction for which the contract was executed.
A home inspector may respond that the Standards of Practice of the American Society of Home Inspectors determines just what a home inspection “is”, and since ASHI has been the standard for home inspections since 1976, that would be a good answer. But it isn’t the only answer.
Many buyers expect their home inspector to have Errors and Omissions insurance, and many real estate agents have the same expectation, since they themselves carry E&O. Insurance carriers have their own ideas about the contents of the inspection reports for which they provide coverage. One such carrier very recently issued a bulletin to its E&O customers that read, in part, “While there are obvious difficulties in defending inspection reports with word-boring, boilerplate disclosures, we recommend inspectors protect their interests by reporting conditions in great detail – even greater detail than in previous years.”
People who have nothing to do with the transaction or the inspection also have opinions about what a home inspection should include. Recently, new homeowners in our area hired a contractor to do some remodeling in the lower level of their split foyer home. When asked to make some modifications to the two bedrooms in the lower level, the contractor stated that ‘you can’t use these rooms as bedrooms because the windows are too small to provide emergency egress. Your home inspector should have told you that.’ So, the homeowner’s house has suddenly shrunk from 5 bedrooms to 3, and the homeowners have suddenly become very unhappy with their home inspector, their agent, the seller, and the agent who listed the home as a 5-bedroom.
An inspection report that accurately describes all visible conditions that affect the safety and integrity of the home will meet or exceed the expectations of the buyer, and it can help protect the seller and everyone else involved in the transaction from claims of non-disclosure. Sellers should expect nothing less from the inspectors who visit their homes.
The answer to the question “what is a home inspection?” will depend on to whom the question is asked.
A real estate agent may respond that the purchase contract defines the purpose and limitations of the home inspection, but that’s not altogether correct. The purchase contract merely defines which parts of the home inspection report apply to the transaction for which the contract was executed.
A home inspector may respond that the Standards of Practice of the American Society of Home Inspectors determines just what a home inspection “is”, and since ASHI has been the standard for home inspections since 1976, that would be a good answer. But it isn’t the only answer.
Many buyers expect their home inspector to have Errors and Omissions insurance, and many real estate agents have the same expectation, since they themselves carry E&O.; Insurance carriers have their own ideas about the contents of the inspection reports for which they provide coverage. One such carrier very recently issued a bulletin to its E&O; customers that read, in part, “While there are obvious difficulties in defending inspection reports with word-boring, boilerplate disclosures, we recommend inspectors protect their interests by reporting conditions in great detail – even greater detail than in previous years.”
People who have nothing to do with the transaction or the inspection also have opinions about what a home inspection should include. Recently, new homeowners in our area hired a contractor to do some remodeling in the lower level of their split foyer home. When asked to make some modifications to the two bedrooms in the lower level, the contractor stated that ‘you can’t use these rooms as bedrooms because the windows are too small to provide emergency egress. Your home inspector should have told you that.’ So, the homeowner’s house has suddenly shrunk from 5 bedrooms to 3, and the homeowners have suddenly become very unhappy with their home inspector, their agent, the seller, and the agent who listed the home as a 5-bedroom.
An inspection report that accurately describes all visible conditions that affect the safety and integrity of the home will meet or exceed the expectations of the buyer, and it can help protect the seller and everyone else involved in the transaction from claims of non-disclosure. Sellers should expect nothing less from the inspectors who visit their homes.
You’re very welcome Jeremy, and thanks for adding to the home inspection body of knowledge!
You’re very welcome Jeremy, and thanks for adding to the home inspection body of knowledge!