Jun 17 | Posted by Barry

As a companion piece to the May editorial on Moving In and Moving Out, I thought it rather appropriate to write this month about home inspections, their significance and how you fit into the process.

From touring a house you can get a sense of the layout, design and feel, but a physical assessment will tell you what's beneath the surface. A trained and certified home inspector will check the structure, exterior, basement, roof, garage, plumbing, water heater, electrical wiring, circuit breakers, appliances, heating system, fireplaces, air-conditioning system, and every other nuance that makes your home functional. They are looking for flaws; anything that might deter from your living experience or force you to incur further cost.

The key tenet of their job is to objectively report on the current state of a house. Good inspectors are trained to spot the warning signs of a problem, but offer no guarantees about future occurrences or the life expectancies on various systems. It is an informed opinion meant to aid in your decision, but an opinion nonetheless. If you find out after the fact that part of their assessment was a misjudgment, then it can be troublesome to seek adequate compensation.

The major caution here is that not all inspectors are fully competent in their job. It is your responsibility to seek out a fully proficient inspector. In Canada, the industry is unregulated. Home inspections are not managed directly through the government, but rather, the standards of practice and code of ethics are enacted by self-regulating professional bodies, such as the Canadian Association of Home and Property Inspectors (CAHPI). You are most likely to find a highly qualified inspector operating under the banner of one of these accredited businesses.

Most home inspection contracts have clauses which specifically dictate how much an inspector is liable for if they are incorrect in a part of their analysis. Often, this amount is far below what is actually required. One critical prerequisite to look for is Errors and Omissions Insurance (E&O) which provides an extra means of accountability in case of error. I would not suggest you proceed with an inspector who lacks the E&O safeguard.

What I would recommend is that you are onsite during the inspection. You will gain additional insight about your property and it will grant you the opportunity to gauge the confidence of your inspector. Furthermore, consider having more than one home inspection, completed by practitioners with different areas of expertise. For example, an electrical specialist may catch something that a general home inspector had passed over.

Home inspections absolutely must be done before you move in to the new house, and ideally before you sign off on the actual purchase. But they are not just for buyers. I advise all my clients wishing to sell their home to first get their own property assessed for three reasons.

First, home inspections provide key facts about the condition of the house, which may be factored into your listing strategy. The hope is always that everything is fine, but if something is drastically out of line, then the inspector’s report offers another point of compromise that myself and other real estate agents assess against the desired asking price.

Second, the practice informs home sellers of any necessary repairs, giving them time to make corrections and prevent any stalls during negotiations. Some issues may require general repairs, while others may even be fire or safety hazards. In rare cases, an inspector may even find a problem so obtrusive (such as a poor foundation) that it could be a deal breaker.

Third, intricate knowledge of your house will be conveyed to potential buyers during the sale process. They will respect your earnest preparation. Trust is a big factor during home transfers, and being forthcoming with all the details will make it go smoother and faster.

And after all is said and done, buyer or seller, you will have many serious questions to ponder. How much will it take to repair all the house’s deficiencies and bring it up to code? As a buyer, is it a bearable cost, or should I leverage this information to ask for a reduction in price? As a seller, is it in my best interest to fix the issue prior to placing the house on the market, or simply address it when the time comes?

Your home is one of the most important purchases you will make in your lifetime. It’s crucial that you have all the facts so that you make the best decision possible. If you have any doubts or queries, give me a call and I’d be more than happy to discuss them in further detail.