A misconception about the home inspection process and the authority of the home inspector
My wife has become friends with her former teacher, and we were invited to a dinner with some of their friends. When one man discovered that I was a home inspector, we began talking about the real estate market (a topic of great interest too many). He stated a belief, which I hear often enough: the seller is required to make the repairs on the home inspector’s report. Yes, I have mentioned it before: the report is a statement of the home’s condition, and places no requirements on either the seller or buyer. It was an entertaining dinner, and I may not be writing about it, except for a change in the law, which may color my answers to such questions.
The required property inspection is undergoing a change. One change is that it will clearly spell out my answer on the report itself. I think that this might be due to the fact that some inspectors and Realtors do stress required repairs. They feel that this is in the best interest of their clients. One guest turned towards me to relate the story of a recent sale. The buyer insisted that the price of the home had to be lowered by $20,000 because of the findings in the home inspection report. It was obvious that the buyer felt that the market would permit/reward his bad behavior, to obtain a home in a good location at a very low price. I have had buyers suggest that they wish to use reports to lower the price, but I say that is up to them. I feel that attitude is inappropriate; however, in the current market, it may be growing.
One dinner companion insisted that home repairs mentioned in a home inspector’s report are mandatory, because a friend was just forced to make certain repairs. I think that the situation may have occurred not due to a home inspection, but due to a change in the sales contract, which took place this past September. Paragraph 7D of the One To Four Family Residential Contract (Resale), which is the form TREC 20-8, has a new provision dealing with the property condition. If the buyer has no intention of requiring any repairs before the option period, they would check off paragraph 7D(1). After the option period (when inspections have been performed), the buyer may realize that a repair is needed. Then an addendum is added to the contract that the buyer and seller have to agree to, so a repair becomes mandatory since the seller agrees to it. Paragraph 7d(2) offers a means for the buyer to bind the seller to a specific repair by accepting an offer though.
The important term here is “specific”. The buyer has to see something that requires a repair, and they have to mention that item specifically. The seller needs to go over this contract carefully to understand that the seller is accepting that this repair should be done. In other words, the repair becomes mandatory. How would the buyer know what to mention in this section? The repair has to be visible to them. A downed fence after a hurricane is a common issue right now, but I was in a house where a seller was doing the laundry and dishes while the house was being shown. The dishwasher began leaking while we were there (visible). The other way is the Seller’s Disclosure Form.
I told the gathered party about a recent experience with a client who was a seller. They had disabled their garage door opener after they had lowered the ceiling for a finished garage. The door now scraped against the ceiling when opened, but they were using the garage as a bath house for their pool. A buyer discovered this fact after the inspection, and they wanted it repaired, but they also wanted to keep the lowered ceiling. The repair cost was too much for the seller. Since the situation was obvious when they toured the house, the buyer could have used paragraph 7D(2), but it ended up in negotiation on an addendum because it was discovered during the home inspection. This tale does show that buyers need to be observant before making an offer (and hopefully, their Realtor is aware of this section of the contract).
This tale led to some surprise among the guests. Home inspectors are meant to protect the interest of buyers, so why would a seller hire a home inspector? A growing trend among sellers is to provide a home inspection report to potential buyers. Many sellers do not want to be surprised, so using a home inspector to find major issues before offering a home for sale allows them to address these issues. In fact, some inspectors provide signs for the homes to show that they have been pre-inspected.
Well, going out to dinner is nice; however, I do not always want to talk shop. Although it is nice to dispel some misconceptions that people have about the industry.