Seller inspections: the advent of adversarial reports

[Marc]

Seeking comments about the rise in seller inspections and the advent of pre-listing inspections that could end up pitting seller inspector against buyer inspector in an arena not unlike the defendants and plaintiffs of a courtroom battle.  This, combined with generous E & O policies, would motivate a new cottage industry of attorneys seeking relief for damages to sellers for issues revealed by the buyer inspection report but missed by the seller inspection report.  Insurance premiums would skyrocket and inspectors would exit the profession faster than you could say 'Lawsuit'.

Anyone else seeing this coming?

[BADAIR]

the last 1 i did was rejected by the seller/owner upon receipt

they actually sent a copy of the report back w/redline @ every comment that i noted w/photos & infrared as deficient & wanted the report completely redacted to represent their property in a better light to their specific instructions

blatantly blamed me for now having to disclose all of these deficiencies

my atty & e&o had copies of all communication & green-lighted before i replied, "talk to your agent & atty"

do every job to the best of your ability & let the bodies hit the floor

Edited May 28, 2018 by BADAIR

[Jim Katen]

You should get some input from inspectors in California. Particularly from LA and the Bay Area where pre-listing inspections have been the norm for many years now. 

[Trent Tarter]

I've been doing pre-listing inspections for many years with no problems. I let clients know the report will be no different than if it were for a buyer. 

I typically give recommendations for items that would be most beneficial to repair or improve. I offer to re-inspect repair work and give an updated report for items that have been repaired or replaced. I also offer to meet with prospective buyers to answer any questions in the report. 

[John Kogel]

If you do your job right, they can't touch you, but who needs the grief?

Offer a walk and talk, easier for the client to have a memory lapse.

I used to print a nice color report with plenty of pics that the seller could leave on the table. That was when no major concerns came to light. If a major defect was found,  I would discuss it and send the digital report after we had our chat. Whether they disclosed was up to them. I never went back.

Almost never heard a squawk, but one seller's realtor mentioned the vermicky in the attic, nice pic, not too alarming of a comment. I said best to cover it with FG batts, removal is expensive and creates dust.

There was a time I did a few, but then they dried up. My theory is that agents began telling sellers it was a waste of money and a bad idea. Maybe it was just the usual black ball, of which I had a few.

Edited May 29, 2018 by John Kogel

[Marc]

A Walk and Talk violates Louisiana HI regulations.

[Mike Lamb]

1 hour ago, Marc said:

A Walk and Talk violates Louisiana HI regulations.

If your client agrees that this is not a LA licensed inspection and they agree to your terms there should be no problem.

[Marc]

No client or contract can over-ride the regulatory definition or requirements of a home inspection.  Only the regulatory body can change the rules, and then only if the statutes that created the regulatory body allow it.

A lot of regulatory bodies are lax in enforcement.  Folks tend to interpret that as meaning its not a violation.

[Tom Raymond]

Most licensing laws begin to define our scope with the real estate transaction. Pre listing inspections by definition occur BEFORE the transaction and are arguably outside that scope. 

[Marc]

The argument is that since the house isn't yet listed for sale, it isn't for sale and that's true, but wait until the Board comes out of its slumber.  They'll closes this loophole by altering definitions in a way that bring pre-listed onto their turf.

I think they're likely to succeed because that's exactly what pre-listed is about...homes about to be put on the market.

Edited May 30, 2018 by Marc

[Jim Katen]

On 5/27/2018 at 1:39 PM, Marc said:

Seeking comments about the rise in seller inspections and the advent of pre-listing inspections that could end up pitting seller inspector against buyer inspector in an arena not unlike the defendants and plaintiffs of a courtroom battle.  This, combined with generous E & O policies, would motivate a new cottage industry of attorneys seeking relief for damages to sellers for issues revealed by the buyer inspection report but missed by the seller inspection report.  Insurance premiums would skyrocket and inspectors would exit the profession faster than you could say 'Lawsuit'.

Anyone else seeing this coming?

I don't see it coming if the pre-listing inspector does a good job. 

We offer these inspections but only do a few a year. We do them exactly the same as we would for a homebuyer. I always tell the sellers who hire me that they should read my report, fix what they think they should fix, and just disclose everything else. Heck, leave my report on the table for the prospective buyers to look at. That leaves the buyer's inspector with nothing new to report. 

[Erby]

10 hours ago, Jim Katen said:

That leaves the buyer's inspector with nothing new to report. 

For you, Jim.  That's very likely true.

But, I think that depends on who does the pre-listing inspection.  Someone like you, or Joe the new guy, or Jim the quickie guy.

[Marc]

8 hours ago, Erby said:

For you, Jim.  That's very likely true.

But, I think that depends on who does the pre-listing inspection.  Someone like you, or Joe the new guy, or Jim the quickie guy.

I think that explains a lot of the contrary responses I get at a FB message board for HIs:  they seem to think that all HIs report with the same expertise.  How could someone be that naive?

[Jim Katen]

2 hours ago, Marc said:

I think that explains a lot of the contrary responses I get at a FB message board for HIs:  they seem to think that all HIs report with the same expertise.  How could someone be that naive?

I have no illusions about home inspectors all reporting with the same expertise, but in my little market, I just don't see the problems occurring that you seem to think are inevitable. 

Plus, when I look at two of the largest real estate markets in the country (LA & SF), where pre-listing inspections are the norm, I * don't* see "insurance premiums skyrocketing and inspectors leaving the profession faster than you can say lawsuit."

I said it before: ask the Cali guys about this - they're experts in it. 

[Jim Katen]

10 hours ago, Erby said:

For you, Jim.  That's very likely true.

But, I think that depends on who does the pre-listing inspection.  Someone like you, or Joe the new guy, or Jim the quickie guy.

Sure, there'll always be the exception - a fool who shouldn't really be inspecting at all. But in my area, those guys actually do very little work. 

In most cases, even a minimally competent inspector with some bark on his hide can find the big ticket items most of the time - and if he's doing a pre-listing inspection where he pretty much *knows* that another inspector will follow him, he does a job that's a bit more thorough. 

I've followed lots and lots of other inspectors and had the opportunity to review their reports. In most cases, I don't like the way that they report things, but I very rarely find that they miss the big "sue-able" issues.