Home inspector's role: working for the buyer
November 26, 2007
by James H. Bushart

In this passing year, Missourians have seen the highest number of foreclosures than at any other time in their history. Families are being forced out of their homes and are forfeiting their investments and high credit scores in record numbers as they struggle to find a new place to sleep.

But, the people who arranged to sell them these houses - the real estate salesmen and saleswomen - have their tens of thousands of dollars in commissions safely secured. No foreclosure threatens to harm them. On the contrary re-sale of the forclosures will bring added profit.

From these commissions, running form $15,000 to $25,000 per sale on the average Missouri home, the salesperson pays dues to a national organization (the National Association of Realtors) and a state organization (the Missouri Association of Realtors) that exist for the sole purpose of protecting and furthering the interests of the real estate sales force. The association that operates a very well-financed and sophisticated political infrastructure in Missouri has been very active in the Missouri Legislature.

It probably helps that 30-40 percent of the very important committees dealing with bills that positively enhance the real estate sales profession are composed of realtors who get elected to the legislature and maintain their membership in the associations (NAR and MAR) that lobby them. For example, last year the Missouri Association of Realtors supported a bill (that did not pass) that would have made a salesperson immune from a lawsuit if he or she were caught concealing knowledge of a convicted sex offender in the immediate area of a listing. While not to the homebuyer, the benefit to the salesperson is obvious.

Likewise was the association's attempt to place the home inspector under its control by a bill it sponsored that would have a real estate board oversee the inspector's actions. That would mean that the board would have direct control over the only party in the transaction who does not profit from a percentage of the sale of the house. In their wisdom, the Missouri legislature ignored this suggestion and did not even consider putting the bill up for a vote.

One would think that ethics would not have succumbed to profits One would think that associations representing real estate sales people would have wanted to focus all of their attention and energy in helping their potential customers avoid the known dangers that have cost so many homeowners their dreams. But let's not forget that the Missouri Association of Realtors is not in business to protect the homebuyer. It is there to protect the interests of its members who pay their dues. And it is there only to advance the interests and sales of the sellers of homes and properties that it represents.

Now we have a new legislative year coming up. The Missouri Association of Realtors has been hard at work. As a result of its efforts and political contributions made over the summer, it has convinced a legislator to try again to push through a bill....not for the protection of homebuyers....but for the protection of sales commissions. The association, once again, will concentrate its efforts in trying to reign in the impartial home inspector who writes the report that potentially might knock out a sale.

Home inspectors look at a property and describe its strengths and weaknesses to the potential buyer in an unbiased report. When the homebuyer decides to walk away from the sale based upon information in this report, the real estate salesperson makes no money. Thus, his association...the Missouri Association of Realtors...has an interest in helping him or her and its other members combat this problem.

A new push for this year is mandating malpractice insurance for home inspectors that would shift some of the lawsuits that are now being made against real estate sales people to that of home inspectors. Of course, the Missouri Association of Realtors finds this to be of benefit to its membership and has endorsed the mandate without bothering to check with the Missouri Attorney General's office whose records reflect that in the past five years more complaints have been filed against florists than home inspectors.

Malpractice insurance is not cheap. Increasing the overhead of a home inspector is the association's tactic that it thinks will increase the need for an inspector to solicit referrals...knowing that realtors are unlikely to refer an inspector who might cost them a sale.

These realtors made seven percent commission on your parent's $10-15,000 home in 1950....and they still make the same commission on the $300,000.00 Missouri home selling, today. This is big, big money. No doubt they won't complain about sharing some of this money to help them protect it.

The foreclosure rates, predatory lending practices, and title insurance issues are fortunately on the front burner with the legislators who are NOT influenced by the realtors and their lobby. However, these legislators still need your encouragement and support.

James H. Bushart of St. Louis is president, Missouri Chapter of the National Association of Certified Home Inspectors

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HADD Headline News pagehadd235402007-11-26 22:02:17
Home inspector's role: working for the buyer hadd233402007-11-26 21:55:39