What a home inspection is not
July 10, 2007
Our friends with the Missouri Association of Realtors (MAR) have been very successful in helping their members totally transform the public image of their profession. I have to hand it to them.

In 1960 realtors collected their 6% commission for selling a house in Missouri for an average of $17,000. They put a sign in the yard, they advertised the home, and they toured prospective buyers--then with a sale saw the process through closing....and collected their money when the process ended - $1,200 on the $17,000 sale.

Now, with the same house selling for $200,000 and their commissions still at 6%, today they earn about $12,000 on the sale of that same house. The home inspector, depending upon his fee schedule, will earn between $250 and $350 for inspecting that same house.

Your agent gets $12,000 and the inspector gets on average $300.

There is a law that requires the seller and his agent to disclose to the buyer all of the known defects of the house, but MAR does not want its salespeople to be accountable for undisclosed/undetected defects. They want to pocket the $15,000 for selling your house and require the $300 home inspector to make good on any defects that the seller successfully concealed from him and he didn't find.

That's right. In the eyes of the Missouri Association of Realtors and the Kansas Association of Realtors, the liability for the stated conditions of the property should NOT rest on the seller (who might be making a large profit) or the salesman (who might make $12,000)...but the inspector who earns about $300. They are arguing, today, for the need for legislation that would mandate this.

This reminds me of HB 324 from the 2007 Missouri Legislative Session under consideration because the Missouri Association of Realtors wanted a real estate salesman be immune from any liability should he be found intentionally to have concealed the existence or proximity of a known sex offender when selling a piece of property. As long as, at some point in the process, the salesman gave the buyer a piece of paper recommending that he research the state's sex offender registry, the salesman would be off the hook...even though he knew of the pedophile and of the potential for a buyer's four pre-school aged children to be playing in the adjoining yard.

Yes...now, they want to bank their large commission checks and force the proportionally under-compensated home inspector to be some kind of a "warranty provider" covering the house from future defects.

A home inspection is NOT a warranty.

A home inspection is NOT invasive.

A home inspection reports on the visible and current conditions of the systems within the home.

The inspector will not know what the seller knows is behind the fresh drywall he just installed and painted a month before he listed the home. The inspector will not know what lies below the new insulation in the attic, or above the new drop ceiling in the basement.

If we were allowed 6% of the sale, like the real estate salesman is, we probably could afford to bring in a dozen specialists over a seven day period to disassemble and re-assemble the entire mechanical part of the home and warranty it. Obviously, that is unrealistic.

However, the answer is not in NEW legislation.

The answer is to be found in applying the law already on the books. Force the seller to disclose, and force the real estate salesman to ensure that such disclosure is made and provided in writing, as the law requires, to each prospective buyer.

Present the home, honestly, and allow the inspection report to serve as it is intended ---- a supplement to the disclosures of the seller and his agent and, in other words, to force the seller and his agent to earn their profits.

by Jim Bushart
Home Inspection Services of Missouri

(Residential Buildings & Wells)

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