New Construction: Punchlist VS Home Inspection

By
Real Estate Agent with Judy Burkett Realtors

Is a professional home inspection on new construction really necessary?  Isn't the punchlist performed by the buyer and the buyer's agent sufficient?

An incident this week made me aware that the consumers (and some agents) regard punchlists and professional inspections as one in the same; I believe that that is a dangerous assumption for either of these parties to make.  Here is my recent experience that I believe illistrates my concerns perfectly:

Last week I negotiated a contract on a sixth month old resale home.  My buyer is a very detailed engineer who of course had the home inspected.  While the home is in overall good shape(which is to be expected in a six month old home) the inspector turned in a laundry list of issues.  The seller was FURIOUS with me and my buyer for wanting these items address,  Now, bear in mind some of these issues are safety concerns; a dryer vent in the attic was not attached, a pilot light on the cooktop was not shutting off correctly, two ground fault indicators were not tripping as required and the exhaust vent for the gas hot water heater in the attic was coming in contact with the wood roof decking.  The rest of the issues were equally important and were defentely the builder's responsibilty.  My buyer and I stuck to our guns and are requireing all items to be remedied by the seller; now the seller is frantically trying to get the builder to come back out before closing.  IF BEFORE CLOSING ON THE HOME  THE SELLER HAD IT INSPECTED, ALL OF THESE ITEMS WOULD HAVE BEEN ADDRESSED BEFORE THE BUILDER RECEIVED HIS MONEY AND LOST INTEREST IN RETURNING THE SELLER'S CALL!!!!   Now, the builder is ..at least in his mind..finished with the home and concentrating on new homes that he is building and Mr. Seller is scrambling to meet a very tight deadline on our deal.

The listing agent on this transaction  is frustrated and made a very interesting comment to me yesterday.  She basically said "Well, we(she and her client) did the punchlist and the builder took care of everything on it, so we shouldn't be responsible for these additional items and you, Shannon, are being to picky!"  She then went on to say; "Besides, the city passed the house with all of the issues so it is not a code violation and shouldn't be a concern."  WOW, how dangerous are both of these statements? 

 The city is not inspecting the house as a whole and they are certainly not doing a detailed look at every component.  If REALTORS® and consumers are relying on the city inspectors to protect them....well lets just say that is scary and unrealistic. 

As far as her other statement concerning punchlists, that is the one that alarmed me the most.  Most punchlist are performed by the buyer's agent, the buyers, the buyer's friends, the buyer's parents, the buyer's coworkers,the buyer's girlfriend/boyfriend's parents and coworkers, the buyer's great aunt, the buyer's Priest and ....well you get the point.  Who does NOT perform most punchlists are inspectors.  While all of the above mentioned people may have the buyer's best interest at heart, most if not all of them have absoluetly no training that would make them experts in the field of inspection.  Therefore, the average  punchlist is  superficial, containing mainly paint issues and cleaning items.  Most builder's happily accept these cosmetic lists, take care of each and every item, give the buyer's their keys at closing and blissfully become unavailable once the check is in the bank and the real issues raise their ugly heads. 

  Are all builders this calous when it comes to follow up work?  No, of course not but what about their subcontractors?  What about the sub's subs?  My point here is it is much easier to get all items resolved prior to disbursement of funds then after and in the case of some of the issues I mentioned above, it is in you and your family's best interest to resolve them before you spend one night in the home with a leakly pilot light.

So the bottom line is:  Buyers, do your punchlist and not every single scratch on the wall and light that does not have a bulb BUT also have a professional inspector come in and find the things you never would.  Agents, DO NOT take on the extra liabilty and heartache of punching out a house and letting your buyers think you have the expertise to do an inspector's job.  Encourgage them to have the home professionally inspected for both yours and their protection.

 

 

Comments (23)

Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

GET AN INSPECTION ON THAT NEW HOME. 

Agents like the listing agent in this case are what let buyer's agents like me to thrive for the past 10 years. 

I am one smart, experienced real estate broker and I had an inspection on my new home this year.  We had a 4 page punch list that took the builder 3 weeks to clear before the 120 deadline for punch list items.

That's a lot of "not so obvious" defects that I won't be passing on to the buyer when I sell my home.  Unless an agent knows structure, mechanicals, electrical, plumbing, grading, etc., they should recommend a good new home inspector. 

Lenn, Homefinders.com

Jan 26, 2007 09:43 AM
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

Hi Shannon

 

As an exclusive buyer's agent, our company always recommends that Buyers have inspections at various key phases during the construction and another a few days prior to closing.  The problem our buyers sometimes experience is that the builders will NOT agree.  However, the more enlightened builders and their agents realize that independent inspections actually protect the builder as well.  If there are defects, they can be corrected and the builder and their agent will not have to worry about something showing up later that could result in litigation.

 Thanks for the article.

 

Joan Whitebook

Buyer's Option Realty

Serving Buyers in So. NH

 

Jan 27, 2007 12:35 AM
David Helm
Helm Home Inspections - Bellingham, WA
Bellingham, Wa. Licensed Home Insp
Excellent blog.  As an inspector who also spent thirty years as a builder and remodeler, I couldn't agree more.  A professional inspector probably won't comment on the minor cosmetic issues, but will surely find that toilet drain that wasn't connected, the carpeted over too large cutouts for furnace vents, the leaking water heater (yes new ones can leak). All three of these examples are among many I have found while inspecting new homes.  Imagine how it would have been a year down the road with that unconnected toilet drain. The reality of building in 2007 is that a GC often does not keep as close a watch on subcontractors as he should, and many things, in the rush to finish and sell, get missed.
Mar 14, 2007 08:49 AM
Shannon Sims
Judy Burkett Realtors - Baton Rouge, LA

David-

 You are exactly right.  I highly recommend an inspection on all of my new construction sales and if my buyer decides against one I have them sign a disclosure that states they were made aware by me that it was available and recommend.

Mar 14, 2007 08:56 AM
ooooo kkkkk
Builder's Eye Home Inspections - Pueblo, CO

Love all of your comment , too bad folks around here haven't caught on yet , but we're working on it!

Mar 15, 2007 08:03 AM
Shannon Sims
Judy Burkett Realtors - Baton Rouge, LA
Ernie- It takes time!  People have to be reeducated on the best way to protect themselves and their largest investments.  Keep up the good work!
Mar 16, 2007 05:03 AM
Jimmy Breazeale
Sherlock Home Inspections - Coldwater, MS
Yep...builder omissions are especially evident in high-growth areas.  This does not mean that a builder is trying to cut corners.  It usually just means that he/she is as busy as a one-armed paper hanger!  Good builders, those who drive by a home 10 years later and swell with pride, are concerned about their reputations, and view a quality inspection as an extra set of eyes working FOR them!  From an inspector's point of view, there are only two reasons a builder will resist or carp about having their work thus scrutinized: false pride, or something to hide.
Mar 16, 2007 07:28 AM
Shannon Sims
Judy Burkett Realtors - Baton Rouge, LA

Jimmy-How are things in Mississippi?  You are right, now in the Gulf Coast areas the market is so fast it is very easy for good builders to become complacent or overlook things.  That is why it is so important to have an inspection on ANY home.

Mar 17, 2007 06:00 AM
Ruth Jacobs
Quantum One Realty - Palm Beach Gardens, FL
North Palm Beach, Real Estate Specialist, CDPE, SF
We have had inspections on new construction and have been very thankful of doing so.  One of our buyers was very grateful that we suggested it, even though it cost him $1500 on his $2.5 mil home.  Saved a lot of aggravation for the buyer to have a third party professional bringing the problems up and working on them before the funding.
Mar 17, 2007 06:47 AM
Shannon Sims
Judy Burkett Realtors - Baton Rouge, LA

Ruth- The very fact that you advised your clients to have an inspection on the new construction shows that you are probably one of the most professional and educated agents in your area!  I find most agents are not that together yet.  Keep up the good work!!!

Mar 17, 2007 07:02 AM
Chuck Ethridge
North Idaho Dream Team - Coeur d'Alene, ID

In our area most builders have a one year warranty on new construction. I only know of one builder what would balk at fixing those kind of items, and I frankly try hard to not sell one of their homes.

Regarding home inspections, with builder where my team has sold many products and know they stand behind their warranty, I am not fearful if the buyer chooses not to have an inspection. Otherwise I always recommend getting one.

Apr 03, 2007 03:04 PM
David Helm
Helm Home Inspections - Bellingham, WA
Bellingham, Wa. Licensed Home Insp
Generally, one year warranties are mandated by state law.  Those kinds of repairs (after one year) would not be helpful in situations like I posted above.  Again, having been a builder for thirty years, there is no way I would buy a new home without an inspection.   There are just too many things to go wrong.  I would probably be more trusting of a builder who is hands on and builds only one home at a time.  The more irons in the fire, the more probability of things getting missed.
Apr 04, 2007 06:16 AM
Shannon Sims
Judy Burkett Realtors - Baton Rouge, LA

Charles-  My objective with new construction inspections is mainly to verify that the mechanical systems and other components that are not evident are in working order.  I find most punchlists are fairly superficial and not at all comprehensive.  I have the inspector to check the items I can not.

 David- Thank you for your thoughts. 

Apr 04, 2007 08:28 AM
David Helm
Helm Home Inspections - Bellingham, WA
Bellingham, Wa. Licensed Home Insp
Shannon, you're welcome.   I just want to add that, typically, I find more issues with a brand new home than I do with an equivalent ten year old home.  It takes time for a house to become a home.
Apr 04, 2007 09:59 AM
Anonymous
Karen Goodman

Shannon - This is a great article and linked to it in my recent post. I know that you wrote it awhile ago, but the issue is even more relevant in my area where builders are struggling to stay in business. We just had a huge, reputable builder in our area get foreclosed on in for several subdivision due to the slow market and their high level of liens. If the builder might not be around in 6 months...you really need to have had the house inspected before you close rather than relying on a warranty.

I just posted an article discussing the importance of home inspections in new construction. To read more about the types of things I have show up on new home building inspections, take a look here: http://www.realestateinfostl.com/blogs/karen_goodman/archive/2007/12/04/st-louis-real-estate-new-construction-why-hiring-an-inspector-can-save-you-money.aspx

Karen Goodman
http://www.realestateinfostl.com/blogs/karen_goodman/default.aspx

 

 

 

Dec 04, 2007 01:24 PM
#18
Dana Hollish Hill
Hollish Hill Group, JPAR Stellar Living - Bethesda, MD
REALTOR * Broker * Coach

Very good points. I believe that much of real estate is about motivation. If the seller/builder has to make the repairs to get the deal, they will. 

I must add that I just had an excellent transaction with a builder who went the extra mile to take care of everything we threw on the list and it was not a cosmetic list. He was a small business builder who built very high-end, lovely homes. It did restore my faith a bit.

Dec 12, 2007 04:23 PM
Craig Williams
J. Craig Homes - Mobile, AL

Great post! My question is, with a six month old house the home should have still been under the builder warranty. We offer a one-year builder warranty with all new construction homes. I hope everything was resolved and to answer your question....NO all home builders are not this way!

Jun 05, 2008 04:42 AM
Steve Graham
Inactive - Atlanta, GA

Absolutely. I like to have the inspection done before the walk-through (punch list meeting); it's gives me a chance to address the inspection issues with the builder, or their representatives, as part of the walk-through. If there are disagreements with some of the findings, then we can discuss it further.

Feb 21, 2009 05:32 AM
Anonymous
Seth Bonilla

I am a home inspector in Bakersfield, Ca and there is a very simple statement that i use, " for your protection, get a home inspection. The purchase of a home will be one of the largest investments you and others will make in their life. A quality home inspection should always be in your best intrests not your realtors. Many realtors operate on a short list of inspectors, in other words they use the ones that dont cost them deals, I know this first hand. A punch list will not identify major defects within a dwelling only cosmetic issues. Ask yourself this, I am planning to spend $100,000 to $1,000,000 ON A PLACE TO CALL HOME. Is a home inspection that costs $300-$1500 worth the investment?. Are you familiar with hvac/electrical/plumming/foundations/crawlspaces/roofing/grading/flashings/fireplaces/roof penetrations/drains? and the list grows. One of the first questions I have for sllers (if they are present) Is there anything you can tell me that is wrong with the property? 90% of the time the answer is no, and 100% of the time I will dicover issues, some minor, most major. I have been called a deal breaker by realtors, Imagine that. banned by several realtors for conducting a thourgh inspection, remember, inspectors should be working for you not the realtor. I will always look at a inspection as if my family will be living there, there is no other way to see it. If anyone reading this has questions or concerns please let me know. Your safety and well being are important to me.

Aug 11, 2009 02:10 PM
#22
Anonymous
Ed from Eagle Home Inspections, Lafayette, NJ

Hello everyone.  New construction is my specialty!  I've been a new home builder for over 20 years and a home inspector for the past 12.   Yes, new construction inspections are important.  I can't believe how somethings are missed by local builders and township inspectors.

I'm always available for questions or to discuss inspecting any home.

Please visit my web site www.best-inspection-best-price.com

Sincerely,

Ed Romaniello

Jan 28, 2010 06:07 AM
#23