A thorough home inspection by a competent professional can be the difference between comfort and grief in a home purchase.

Buying or selling a house without an inspection is like driving a car without ever having a tune-up. For a seller, a pre-sale inspection provides a clear picture of the property’s condition and eliminates nasty, last minute surprises and upsets. In either case, you will eventually find out what is wrong; however, fixing it will probably be much more expensive than had you taken responsibility earlier.

When I began my real estate career in 1979, home inspections were relatively common. Today, they are even more popular than ever, and pre-sale inspections by sellers are increasing. Although generally regarded as necessary, there is still considerable confusion on the part of buyers and sellers about the process.

In this article, I am referring to what are alternatively called “physical,” “general,” or “contractor’s” inspections. Structural pest control, i.e., termite, inspections fall into another category, which I detailed in previous articles.

A house comprises systems

Some inspectors think of themselves as doctors giving a physical to the patient. Like the human body, a house is simply a number of systems designed to work in harmony. The electrical system in a house may be compared to the nervous system in our body, plumbing to the body’s circulatory system, and so on.

The inspection contingency

A buyer’s right to have inspections comes from a standard clause in the purchase contract which allows for “Buyer’s investigation of property condition.” A seller can use this section of the contract as a guide for his pre-sale inspections.

The California Association of Realtors (CAR) eight-page contract warns the buyer in bold capital letters: “Buyer is strongly advised to investigate the condition and suitability of all aspects of the property and all matters affecting the value or desirability of the property, including, but not limited to...”

The following is a summary of items suggested by the contract as areas the buyer should investigate, including some which are not directly part of a property inspection:

Condition of systems and components. Foundation, roof, plumbing, electrical, etc.

Size and age. Square footage, room dimensions, lot size and age of property improvements.

Lines and boundaries. Property lines and boundaries. Fences, hedges and walls may not necessarily mark actual boundaries. Only a survey can verify this.

Waste disposal. Type, size, adequacy, capacity and condition of sewer or septic systems.

Gov’t requirements and limitations. Possible absence of permits, restrictions on property use, future development, zoning.

Rent and occupancy control. Some cities and counties impose restrictions on rent and/or maximum number of people allowed to occupy the property.

Water and utilities; well systems and components. Water and utility availability and use restrictions, considerations about wells.

Environmental hazards. Asbestos, formaldehyde, radon, methane, lead paint, fuel or chemical storage tanks, contaminated soil or water, hazardous waste, electromagnetic fields.

Geologic conditions. Seismic conditions, soil stability, suitability and drainage.

Neighborhood, area and subdivision conditions. Schools, proximity of law enforcement, crime statistics, fire protection, transportation, etc.

Personal factors. Conditions of significance to certain cultures and/or religions, personal needs, requirements and preferences of buyer.

Most buyers need an inspector

Very few homebuyers carefully consider the above admonitions, especially about the house itself and the grounds. Even fewer have the requisite experience and know-how to effectively inspect a home themselves. They are best protected by hiring a professional.

Time frame for inspections

Although this is negotiable, common local practice is to allow anywhere from seven to fifteen days for a buyer to complete all his inspections. In today’s seller’s market, seven to ten days is the realistic limit. In multiple offer situations, some buyers complete the inspections before their offer is even presented. In a slower market, or if a particular property has been on the market for awhile, twelve to fifteen days would be acceptable.

How to find and evaluate inspectors

Choosing an inspector may seem straightforward and simple; it isn’t. As in every area of business, some inspectors are better and more qualified than others. Unless you understand what to look for, you may end up disappointed.

A word of advice: do not choose based on lowest cost. In this area, the fee for inspecting a single family home of about 2000 square feet or less ranges from $250 to $500. Trying to save one or two hundred dollars on inspections could cost you thousands in overlooked or underestimated problems with the property.

Your real estate agent can provide you with names of local inspectors. Most agents tend to work with a limited number of inspectors. If they find a good one, they will use him again. In an active market, the best ones are booked one to two weeks in advance. If the buyer has ten days to remove his inspection contingency, he obviously can’t wait two weeks for his agent’s inspector of first choice. Experienced agents have one or two other, good inspectors they can call when their favorite is unavailable.

Professional affiliations. At this time, there is no state program for licensing home inspectors. There are, however, two professional inspector organizations. CREIA is the California Real Estate Inspection Association, a state organization; ASHI is the American Society of Home Inspectors, a national group. Insist that your inspector is a member. not just a candidate, of at least one.

Each association has its own requirements for membership. As an example, becoming a member of ASHI involves completing a minimum of 250 paid home inspections, passing a written examination, and having five inspection reports reviewed to determine if they meet the group’s standards of practice.

Errors and omissions insurance. A recent state law made it illegal for inspectors to limit their liability to the amount they charge for the inspection. Nonetheless, if an inspector makes an error that is costly to you, will he have the resources to pay for a judgement against him? To protect yourself, ask the inspector if he carries E&O insurance, and the amount of his coverage.

Narrative vs. checklist. Top Realtors and inspectors are in agreement that a narrative report is preferable to a checklist approach. The narrative is more detailed and comprehensive. It also takes more time to prepare. This is why all the respected inspectors I work with write out their reports in paragraph format.

Length of inspection. Quick inspections tend to be incomplete. Ask how long it should take. Most of my buyers’ inspections take two and one-half to three and one-half hours. Naturally, the time required is related to both the size and condition of the property.

Important: plan to personally attend the inspection, even if it means taking time off from work. This is one of the most critical aspects of your home purchase. You must be at the inspection to understand the condition of the home. Your agent should accompany you, at least for the inspector’s summary.

Final thoughts
Prudent homebuyers and sellers take the precaution of hiring a qualified inspector. Being aware of what differentiates the best from the rest is a good first step. The next hurdle is to know what a comprehensive report covers and how to interpret it. This and other topics will be discussed in part two.

Related Articles: Home Inspections, Part 2; Not Just Termites, Part 1 and Part 2; Are Permits Important?; Check Drainage; "As Is" Pointers, Part 1 and Part 2; Sewer Line Blues