The home inspection industry has sure changed in recent years. Not long ago buyers would hire a home inspector to determine if there were issues with a home. If there were, the standard contract called for seller required repairs up to 3% of purchase price for covered items and up to 2% for wood destroying organisms.
Contracts have changed and now seller required repairs are 1.5% for covered repairs if at all, as more and more contracts are now As-Is with right to inspect. The types of inspections have also changed, so we’ll attempt to inform you about the various types of inspections. In any event, we do recommend a buyer have a home inspection regardless of whether the seller agrees to make any repairs just for the education and knowledge about what you’re buying.
First there is the pre-purchase home inspection. Buyers use this to discover items that may not be working properly and educate themselves about the systems of the home. A home inspector is a great resource as to how various systems operate and the proper maintenance of these items. You may or may not be able to use this report to have seller correct deficiencies depending on the contract you used and the items discovered.
There is also a separate 4 point inspection report your insurance company may require, typically on homes older than 20 years. The insurance companies specifically want information on 4 areas, including the HVAC (Heating, Ventilation and Air Conditioning), electrical wiring and panels, plumbing connections and fixtures, and the roof.
Insurance companies have become increasingly reluctant to issue Homeowner Insurance Policies on older homes (usually 25 years old or more). Their common concern is that there may be conditions in an older home that could become a liability to them. For instance; a home with a roof nearing the end of its reliable service life may fail while under the policy and the homeowner may seek reimbursement from their insurance company for damages to the home or its contents.
Similar concerns extend to the condition of the HVAC, electrical and plumbing systems in an older home. If these elements are in poor condition, in need of being updated or replaced or were improperly installed, they may fail and cause fire or water damage to a home.
Newer homes are assumed (by the insurance companies) to not have these problems as frequently as older homes. There is a standard form for this type of inspection that must be filled out by a qualified inspector or contractor.
There is also a Uniform Wind Mitigation Verification Inspection which provides significant discounts to a homeowner if the home qualifies. The state has recently changed the reporting rules this year making it harder to qualify for such discounts. More proof is needed in the report including photos.
There is also a Roof Certification Inspection insurance companies require when the roof is approximately 15 years old. The 4 point inspection report may suffice if your insurance company asks for this inspection. Check with your company.
Lastly, don’t forget the Defective Chinese Drywall, Mold, or Radon reports. Defective drywall was typically found in homes built around 2005-2007 but that’s not absolute. Keep in mind re-modeled homes could be affected as well. The name comes from China as they exported the vast majority, but truth be known there was defective American drywall in the past as well.
Discuss with your inspector which type of reports would benefit you most given the property you are buying. Inspectors tend to cover themselves, so they will notate anything and everything they see as a concern or potential concern. This is good as it educates a buyer who has never lived in the home about what to look for now or in the future.
Buying a home seems like a scary proposition, however it can be fun and enlightening process if you take the time to learn what’s involved with home ownership. It’s not time to freak out just because items show up in the report. Many of these items are to inform you of what to look for in the future. Isn’t it better to purchase knowing what to look out for than being blind-sided later on by unexpected surprises? We think so.
Good luck and happy house hunting. If you need help buying or selling, don’t hesitate to call us. We’re here to help. 239-489-4042