Inspect the same house twice in one day?

[Neal Lewis]

I got a call yesterday that a buyer needs an inspection in a hurry 'cause there are multiple bids, not under contract yet, etc. So we did the inspection @ 8:30 this morning.

As I'm pulling away from the house, I get a call from a different buyer and she tells me the same story about needing a quick inspection because of multiple bids. Turns out, they want me to inspect the same house. Initially, I said I would do it for half price and just do a walk through (gave them full disclosure). After thinking about it, I called back and said we couldn't do the inspection. It just seems there are too many possibilities for something to go wrong down the road.

I ended up referring a good inspector friend who'se having a terrible year. We're up 35% from last year, so i don't feel so bad about turning away the business.

[Stephen D. Gazo]

from a professional stand point, I would say that 'conflict of interest' prevents you from doing that. Good thinking.

[Jim Morrison]

Well done, Neal.

Jim

[Tom Raymond]

There's no conflict of interest there, just the potential for ugliness when one or both of those clients has their offer rejected.

A scary thought; if you were to be sued by one or both clients, would you be better served to have given them each a copy of the same report, or unique reports for each client? The latter would be damn near impossible to pull off (especially doing both the same day), and you'd likely be screwed either way.

Tom

I'd have been real tempted to do both, but biz has been slow.

[Brandon Whitmore]

Depending on how busy I was, I may have called the first client prior to making my decision. I would have told them that if they were cool with me doing the second inspection or walkthrough, I'd give them a discount. That way, everyone wins (I think)

[Marc]

I'm with Neal.

A lot of my local competition worships the dollar and dismisses ethical business practices, but we all pay for the consequences when buyers begin casting a wary eye in our direction and more homes get sold without inspections.

Marc

[Stephen D. Gazo]

surely I am missing something, ref COI. I see informing the other potential client and if all parties were okay about it proceed. please enlighten me, maybe I am wired differently (60,000v)

Depending on how busy I was, I may have called the first client prior to making my decision. I would have told them that if they were cool with me doing the second inspection or walkthrough, I'd give them a discount. That way, everyone wins (I think)

[Tom Raymond]

An excerpt from the NY COE regarding conflict of interest:

7. Conflicts of Interest

(a) Home inspectors shall avoid conflicts of interest or activities that compromise their professional objectivity, or have the potential of creating an appearance that their professional objectivity has been compromised.

Prior to accepting any home inspection assignment, home inspectors shall disclose all known or potential conflicts of interest that could influence or appear to influence the home inspector’s judgment or the quality of the home inspector’s services.

In this case performing both gigs could be construed as a conflict of interest unless both clients knew in advance that you would be performing two inspections on the property that day. Calling the am client after the fact, especially since there are no binding offers at this point, is a violation of the COE, at least in NY.

Tom

BTW, there was a post a few days ago about SOP's that at first blush seemed kind of obvious, but when was the last time you actually read your contract, SOP, or COE?

[Darren]

I ended up referring a good inspector friend who'se having a terrible year. We're up 35% from last year, so i don't feel so bad about turning away the business.

That's odd, my phone hasn't rung all day!

[Scottpat]

I would not have done the inspection for a second person. What I would have done is to have taken their information and called an inspector friend and given the referral to them. By doing it this way I have help the new prospective buyer #2 by locating a good home inspector and I have helped a fellow inspector who I know.

Win Win for everyone!

[Stephen D. Gazo]

Ref following SOP, without adhereing to them their just suggestions...

[Inspector37620]

This brings up another situation I have ran into. Inspect the same house for two different clients months apart would this fall under the same category?

[Richard Moore]

The thing is that, in a multi-bid situation, the original clients are having the inspection done so that they can remove the inspection contigency, making their bid more attractive to the seller, and make that bid already knowing what needs fixing. It seems unlikely that they would be very happy to find that you were willing to water down their advantage by doing a second inspection for a second client, especially at half the price they paid. I know I wouldn't be.

They are probably aware that other potential buyers are likely doing the same thing. But you, personally, are best serving the original clients interest by refusing any subsequent inspections on the house as long as they are still involved in the transaction.

On the bright side, it's good to hear of bidding wars. In 2006-2007 it was almost the norm around here and a single house could generate work for multiple inspectors. During that time I would often find myself sharing a home with at least one other inspector, and a few times, two others. Maybe things are picking up!

[Marc]

It's not a conflict if the first buyer has walked away.

Marc

[Richard Moore]

This brings up another situation I have ran into. Inspect the same house for two different clients months apart would this fall under the same category?

I would call the first client to make sure they no longer had any interest in the home. If not, then no conflict. 2nd full inspection, full price.

[Inspector37620]

The first client did walk away on the property.

[Brandon Whitmore]

Prior to accepting any home inspection assignment, home inspectors shall disclose all known or potential conflicts of interest that could influence or appear to influence the home inspector’s judgment or the quality of the home inspector’s services.

Hi Tom,

After reading what you have posted, I have a different take on it. I put key words into bold in the above quote. There was no known conflict of interest for the first party at the time of inspection. There would be a conflict of interest if you did not notify both parties prior to doing the 2nd job in my opinion. I wonder what a lawyer would say.

I definitely am not second guessing anybody else's opinion and think Neal did the right thing, since that's what he thought was right at the time. I honestly can't say for sure what I would do under the circumstances, as it has never come up. It might even depend on the type of people the client(s) were.

EDIT: I think I've changed my mind. It's wrong to do the inspection/ walk through if the other client is still interested, and here's why.....

Assuming the report had not already been finished and handed out at the inspection, someone could feel that your report was changed because of others interests........

[Brandon Whitmore]

By doing it this way I have help the new prospective buyer #2 by locating a good home inspector and I have helped a fellow inspector who I know.

In a screwed up way, some may consider this a conflict of interest as well. (collusion)

The example in this thread is way more of a fine line than an agent representing both parties in a real estate transaction.

[Stephen D. Gazo]

Any action on our part that can be perceived as inappropriate has created a perception of impropriety. (dont ask)

I get asked quality and service related questions from my clients. My standard answer is "I have to live here'. I could not in good conscious enter that door. I hope that it never comes up.

[Chad Fabry]

Depending on how busy I was, I may have called the first client prior to making my decision. I would have told them that if they were cool with me doing the second inspection or walkthrough, I'd give them a discount. That way, everyone wins (I think)

Isn't that like me paying for a first time home buyer tax credit? It smacks of socialism. Charge them both the same or there is an impropriety.

There isn't a conflict of interest. Two clients, two distinct inspections, two reports written uniquely with the same issues, two checks.

We're always talking about how we're not part of the deal and how we're objective, and how we don't care if the client buys the house or not. If we're truly objective then what's wrong with providing two clients with two reports for two checks?

[Stephen D. Gazo]

Chad,

I am starting to see differently on this topic. I agree that the house will need a second insp. Why not me. Maybe its the engineering ethics bla bla bla that has me looking at this sideways.

You had me at the report. If I was commissioned by two separate clients to insp and report on some machine etc, I would write two reports for two separate clients and bill both of them. [:-thumbu]

There isn't a conflict of interest. Two clients, two distinct inspections, two reports written uniquely with the same issues, two checks.

We're always talking about how we're not part of the deal and how we're objective, and how we don't care if the client buys the house or not. If we're truly objective then what's wrong with providing two clients with two reports for two checks?

[Jim Katen]

. . . There isn't a conflict of interest. Two clients, two distinct inspections, two reports written uniquely with the same issues, two checks.

We're always talking about how we're not part of the deal and how we're objective, and how we don't care if the client buys the house or not. If we're truly objective then what's wrong with providing two clients with two reports for two checks?

I agree. I'm completely mystified as to why someone would consider this to be a conflict or improper in any way.

- Jim Katen, Oregon

[Richard Moore]

Chad, for me, it's not a case of being objective during both inspections. I would hope we would all be that. With full disclosure, it's not even really a case of business ethics. It's that in the OP's situation, you would have two clients who are competing against each other. It just doesn't feel right, to me, to service both and I would definitely decline the second.

But that's me. I live in a big city with lots of inspectors, I'm not desperate for work, and the odds of it happening in the first place are extremely remote. If I was the only inspector in a small town I would probably have to rethink that position.

Oh...one more thing...after the morning inspection I would be taking a nap anyway. [:-sleep]

[Brandon Whitmore]

Isn't that like me paying for a first time home buyer tax credit? It smacks of socialism. Charge them both the same or there is an impropriety.

I respectfully disagree.

I'd just give them both a discount on my services. More money in less time for me= capitalism.

[Chad Fabry]

You should disagree. I didn't fully understand what you wrote. I thought you were suggesting giving the second client a discount. I really must pay better attention.