Home : Blogs : Bill Westel, ECO : Bill's Blog

Home Repairs – The Good, the Bad, and the Ugly

I recently did a search on Active Rain for Home Repairs and Home Inspections issues and was not surprised to find over 60 blogs about this issue. My concern about home inspections and repairs is about the entire process itself. My experience has been that purchase price negotiations are the easy part of the equation. After we have the Offer to Purchase Contract done, the real drama often begins. In North Carolina we use the Residential Property Disclosure Form that sellers fill out indicating any known problems with a structure. A seller can respond in a way that indicates there are problems/no problems with a particular house component, or makes No Representation regarding whether there is a problem or not with any house system. Experience shows the more No Representations seen on the form the greater repair list will be from the home inspection. But I digress.

As a buyers representative I always recommend that buyers seriously consider getting a home inspection on their prospective property. I give clients the names of three good inspection companies and then the fun begins. Now I prepare home buyers for what a home inspection might turn up using the Disclosure form as a potential guide to what may show up as well as discussing what other inspections of similair dwellings have turned up. But its sometimes difficult to prepare buyers for the wonderful 30-36 page report filled with God knows how many pictures of everything that is wrong with the house. At times these inspections uncover major problems with a house that no one was aware of and of course this is a good thing. Other times only minor repair issues are present. Frequently a combination of both big and small repairs show up in the inspection report. The process for dealing with these repair issues though leaves a lot to be desired. While I think there are certain good things that can happen in this process, there are other home repair situations that very bad, and still others that are just plain ole ugly! This is my short list, you can probably add more items and feel free to do so. Cue Sergio Leone:

THE GOOD

Home sellers that have not put off deferred maintenance on major house components.
Listing agents that have encouraged home sellers to get an inspection before they list.
Property Disclosure forms with few if any items marked "No Representation".
Having buyers present when Home Inspection occurs.

THE BAD

Many "No Representation" boxes checked on Disclosure Form ( it does not always turn out bad, but more times than not it is).
Big repair issues with major house components - foundation, roof, electrical, plumbing, septic, etc. especially when the Disclosure Form gave no warning what was to come.
Sellers and/or listing agents minimizing the big repair issues with major house components listed above, i.e. Well you know the house is old, what do you expect.
No one agreeing how much a repair will cost so that a credit may be applied to buyer for taking care of it after closing. (This could also be in the Ugly!).

THE UGLY

Twenty two pictures in the home inspection report detailing minor electrical/plumbing problems that just totally freak out the buyers.
Spending over 10 hours negotiating who is going to fix/be responsible for minor electrical/plumbing/other problems that will cost less than 1% of the agreed upon purchase price. Then another five hours about how the repairs will be done, by who and what will happen if the home inspector is not satisfied with the repairs.
Seeing/hearing grown adults (usually men) ranting and raving about why the other party needs to change their position regarding repairs.
Hearing the wonderful phrase " If they(sellers) don't do ______________ (Fill In Blank), we are going to walk!

I could go on with the list but I think you get the picture. There just has to be a better way to deal with this issue! I think I will follow up with a Home Repair Process Wish List.

Posted by Bill Westel, ECO on 02/01/2007 06:55 PM

Comments (26)

home repairs, home inspections

26 Comments on Home Repairs – The Good, the Bad, and the Ugly

FEB

2007

Bill: After dealing with a "Ugly" result on a home inspection this year, I sure pay much more attention to them now. Had to tell my buyers that it was the best $600 they had spent this year, as they walked away from an unbelieveable report that no one, buyer seller, or either agent suspected would be that bad. Heartbreak all around. To my knowledge, the house is still on the market and still needing humongous repairs.

Ozarks Joan

Hi Joan:

I just had an inspection on an older home that basically had big problems with almost every major home component. The home exterior itself looked OK, but underneath, ugh! It was basucally a tear down. Still the seller said she had an appraisal that had the property way overpriced. Of course, they were never able to produce it.

Hi Bill...Thanks for this in-depth piece. I had to laugh when you mentioned " Twenty two pictures in the home inspection report detailing minor electrical/plumbing problems that just totally freak out the buyers. "...I had a cartoon-like mental image that arrived and have had an experience like that, too ..luckily it turned out to be a story to pass on to others and smile about ... You say..."Seeing/hearing grown adults (usually men) ranting and raving about why the other party needs to change their position regarding repairs. "...I almost fell off my chair LOL! How true...Is that a "guy-thing" or what?

It takes a professional real estate person to navigate through rough waters. Obviously you succeeded so Right On!Setting client's expectations in terms of what to look for as a "red flag" when the Repair Agreement is prepared seems to remedy tricky situations before they get disruptive.

Thanks, Bill. Some really good points. This always seems to be such a tough part of the process...sometime worse than the initial negotiation to get the right price. I have had some where the inspection was full of things but the buyers were fine, and others where EVERY little problem HAS to be fixed or esle... Amazing how much time can be spent on these issues.

It's tough for buyers and for sellers since ultimately everyone wants the same goal, usually. But the emotions can get in the way and derail the whole process. I advise bueyrs to not expect to not find some problems - there is no perfect house, even a new one.

Jeff

We insist on home inspections AND a home warranty for our buyers. For sellers? I tell them it is "True Confession" re all disclosures.

Bill,

Its so nice to know how many other people experience the same problems. Luckily I've only had to deal with the know-it-all strong male personalities half a dozen times in the past few years. What drives me CRAZY is the arrogance in their thought process! (i.e. "They fix it or we'll just.... a) walk! b) find a rental house! c) stay where we are! )

There's nothing wrong w/ walking from a deal if the news is serious (i.e., roof, major electrical, plumbing, etc.) but when it something that can be easily and inexpensively fixed, that attitude is hard to swallow. Somtimes I have wondered if they act like this because I am a female agent and they don't think I know anything about making repairs.

Anyhow - home inspections are worthwhile if used as an information gathering part of the process and not as a tool for negotiating the price. Some buyers get it and others don't.

Bill- I just went through a lengthy process on Home Inspection Issues...My lord, the Inspector went crazy with his camera...After reviewing the entire 25 page report I thought that the house should be torn down and rebuilt. The Inspector's report just about destroyed my Buyer. I needed therapy after that.

Most of my buyers get the inspection. No guarantees, but piece of mind.

I think preparation of the Buyer is very important. I represent only buyers. It is important to let them know that the inspectors I may suggest (although they may choose whomever they want) are very thorough -- but that does not mean that the seller is going to fix everything that comes up in the inspection -- I let them know we are looking at those items which are safety issues, items which one would not expect given the age of the home (e.g. a 5 year old home with a failed septic) or a structural defect. On the other hand, by knowing all the information on the home, they can budget for those items which need to be taken care of.

On the other side of the coin, there are sellers that simply minimize the some of the more significant things that come up during the inspection. I think pre-sale inspections are very helpful -- therefore, the seller can take care of any items prior to putting the home on the market -- this is especially true if there are some major issues.

A good home inspection with proper counseling of the client is key!

Joan

FEB

2007

Very nice post. Every single buyer of mine has gotten an inspection to this point. I even recommend them on new homes....

Good post and very informative. I have all my buyers get inspections. I may be wrong, but don't all financed deals require them? I thought a bank wouldn't touch a house if it had roof problems?

Good work.

Bill,

Thanks for the post. I recommend home inspections to all clients, even if the seller had on done. On one occasion a property was under contract and the buyer's relocation did not go through. She did have a home inspection on the property and left the report with the seller. The seller then offered it to my customer, who asked me "should I have my own inspection or use this report?" I provided the correct answer by saying you should have your own. Sure enough, her inspector found significant damage to an encased main support beam, which was not mentioned in the report offered by the seller. he removed a small portion of the encasement, that warranted a full evaluation, to which the seller consented, thereby revealing a costly repair to everyone's surprise. moral of the story, don't encourage customers to cut corners on such a major purchase. If I had suggested/recommended use of the report as a basis for purchasing the home and the damaged discovered after the fact, I would've had a huge liability.

Bill

Great post and yes home inspections are a huge issue. I would only say that is whole process is proof of the value we bring real estate transactions on behalf of buyers and sellers. Not sure what any contracts elsewhere say, but ours is pretty clear..states something that the expectation being, that " items function for the purpose for which they are intended" and that inspection items may not be new...and so on. Probably the best start in my opinion is to accurately gauge your buyer clients personality type and understand going in to the inspection how they might react. Good counsel before the inspection and after can do a lot to keep this from killing a deal. I posted on this on my other blog, mainly adressing what I think agent roles in selecting home inspectors is

It is so nice to read all of the wonderful posts about people using home inspectors! What a service to your clients, even though a bad or an ugly comes along sometimes. For those of you looking for a way to best prepare you clients for the inspection, National Property Inspections offers a couple of tools for Realtors that might help.

We have a Home Inspection Guide for the Home Buyer and Home Seller. This lists the purpose for a home inspection, timing, perspective on home inspection (nothing in life is perfect) and a guide for preparing the home for the inspection, including tips on what areas to leave open and accessible and safe places for pets. We also provide sample reports upon request. Having a sample report available for the clients to view beforehand might remove some of the shock of the report's length and number of pictures.

Ask your current inspectors for their versions of these items. It might help you prepare clients and avoid some of the unexpected bad and ugly moments. Again, kudos to everyone for seeing the value of inspections.

A few more defects people often miss.

Inadequate drainage
downspouts that empty next to the foundation
windows caulked in, instead of with proper splines and a head flashing
stoops poured directly against the house w/o capillary breaks
insufficient siding to grade clearance
blocked vents
poor attic ventilation
sloppy HVAC
poor flashings of every sort
roofs without drip edging
fans venting into attics and crawls
dryer ducting too long
furnaces improperly vented
water heaters without proper T & P or seismic bracing
siding installed incorrectly
no weeps in brick veneer
faux stone without weeps meeting grade
improperly installed shingles
Poor grade drainage
Exposed / uncaulked nails on the roof
Errors in neutral bar wiring (Main panels)
Errors in neutral bar wiring (Subpanels)
Lack of GFCI's in required locations
Sinks / tubs that don't hold water (stopper leaks or is missing)
Errors with water heater relief valves and piping
Non-professional work where a professional was needed
Flange bolts and other fasteners not tightened at column(s)/beam
Anchor bots not tightened at sill/sill plate(s)
Improper joist boring/notching/end-bearing

No drain pan under water heater
T & P valve drain has a reduction in size
No back flow (anti siphon) prevention in commodes or at exterior hose bibs
Insuffiecient air gap at refill tube in commodes
A/C condenser under or over fused
Trees and/or heavy foliage too close to house
Dead bolts on exterior doors requiring a key from the inside

- No vapor barrier in crawl space.
- Homemade shims for support columns.
- Bath vent exhausting to attic.
- Plastic dryer duct. Real bad!
- Metal dryer duct with screws. (collects lint)
- Gutters rusting at seams.
- Debris in roof valleys.
- Hot water heater set too high.
- Sellers trying to hide previous leaks under sinks.
- Almost always, insufficient attic insulation in older homes.
- Wood to ground contact (posts).
- Realtors in a hurry.
Breaks in the firewall between the garage and living space of the house. Either an attic access door made from inadequate material, or missing. Door into living space from garage has none or inadequate weather stripping

Doors opening out over stairs, and stairs without handrails. Inconsistent rise in bottom and/or top step. Uninsulated attic pull-down stairs.

Dan at www.magicbullets.com :~)

It's become such a big deal in my business, that I finally just started offering buyers a free home inspection (good selling point too) in order to make sure that an inspection is done during the option period.

Hi Dan:

Thanks for the thoroughness of your comment about defects that people often miss. I bet you even have some pictures of these, don't you? :)

Hi T. Baker:

The information regarding sample home inspections was useful. I am going to try and round up some of those. Thanks!

Hi Maggie:

All lenders I have dealt with require a home inspection. Roof problems are on a case by case basis. We recommend very good inspectors for our clients, its just that sometimes the things they have to do to satisfy their license requirements and protect themselves on the liability side make our jobs a little or sometimes alot more difficult.

Hi Kaushik:

In reading some of the past blogs about inspections on new homes, I would always recommend that buyers get one. Getting the builder to make repairs after the deal is done can be troublesome.

Hi Lauren:

I understand the trauma involved. Did the buyer go through with the deal? Do they have specialized therapy in Dallas/Ft. Worth for these types of situations?

Great article. As a mortgage broker I can tell you one other aspect. If the Home Inspection is called for in the offer to purchase, it's not unlikley that the lender will ask to see it. You can imagine where it might go from there. And don't forget how tough that can make it for the appraiser. If he comes in with a great valuation, and the home inspector indicates some major issues.....well you all get the point.

FEB

2007

I always try to prepare sellers that their house is not perfect and that the inspector is going to find something wrong and that the buyers are going to use this as a way to beat down the price some more. I usually write in a limit or no repairs will be paid for to nip that in the bud.

APR

2007

Joan, I believe your process is right on. Managing expectations and education are the two most important things one can do in this situation. I believe someone on this blog said that there is no such thing as the perfect home; very true. There is also no such thing as an unrepairable problem. It all depends on the buyer and what their expectations are.

SEP

2008

Yes, the psychology of why so many get disproportionally exercised about repairs needed or not needed before closing would make a great article for THIS OLD HOUSE MAGAZINE!

Leave a response…

Name:

Email:
(optional)

Comment:

What does the graphic say?