Featuring America's Home Inspector: Nationally Syndicated Columnist, Barry Stone
Alleged Collusion Among Agents and Home Inspectors

Alleged Collusion Among Agents and Home Inspectors

The House Detective: by Barry Stone, Certified Home Inspector

Dear Barry:  As an expert witness in construction defect lawsuits, I see many cases involving home inspectors who fail to disclose defects or who minimize the findings in their reports. In most cases, these inspectors are members of the American Society of Home Inspectors (ASHI) or similar associations. One inspector confided that too many problems in his report might “kill” a sale and the agent would no longer recommend him to buyers. Another inspector said he was expected to “work with the agents;” not to raise red flags or be too “nit-picky.” This is disturbing because home inspector referrals come mainly from agents. It also indicates that inspector organizations are not policing the industry very well. Perhaps ASHI or their insurance carriers could maintain a database of court rulings against inspectors and agents. The industry needs to do its job before the government steps in.  Ray

Dear Ben:  Your position as an expert witness exposes you to the worst examples of home inspectors and real estate agents. Without doubt, there are ethical disparities and conflicts of interest among some agents and home inspectors, and it is these unprincipled relationships that engender so many of the courtroom dramas in which you testify. But fortunately, there is a brighter side to the world of real estate and home inspection; one whose characters rarely stand in the shadow of a judge’s bench. So let’s examine the darker and lighter sides of disclosure practices, beginning with those professionals who recommend home inspectors to their clients.

Basically, there are two kinds of real estate agents: Advocates and Hucksters. Advocates are the honorable standard bearers of an often unfairly maligned profession. Advocates are those who truly represent the very best interests of their clients; who actively promote the defect disclosure process, and who recommend only the most qualified home inspectors. Advocates would rather kill a sale and find a better property for their client than to have the client be unhappy after the sale. Advocates know that doing the right thing attracts future business.

Unfortunately, there are also the huckster agents, those who keep attorneys busily employed, who denigrate the hard-earned reputations of the honorable advocates, and who boycott the most qualified home inspectors. Hucksters represent their own financial avarice at the expense of their clients. They compromise the disclosure process by seeking those inspectors who are less likely to provide full defect disclosure. They recommend inspectors who are less experienced, less capable, or who are willing to exchange principal for increased business. A huckster would rather close the sale than jeopardize the immediate flow of commission checks. To a huckster, top-notch home inspectors are known as “Deal Killers.”

Among home inspectors there are also two basic varieties: experienced practitioners and developing practitioners. But even within these divisions, we find the same ethical contrasts that define agents: either a total commitment to the client’s interests or a general disregard for same. Adversely affecting this situation is the reliance of most home inspectors upon agent referrals for the majority of their business. Agents understand this, and some have learned to exert subtle pressure. Nothing overt; just a simple hint such as, “We just want to know that everything is structurally sound, so please don’t be nit-picky.” Another favorite is, “This deal is important; so we need a really good report.” Inspectors who do not accede to these coded messages, who are fully committed to the buyers’ interests, needn’t expect future referrals from those agents. The choice then is well defined: either become a “street walker” for unscrupulous agents, or rely strictly upon the referrals of advocates.

As to the consumer advocacy of ASHI and similar organizations, professional integrity among member inspectors can be influenced and encouraged, but it cannot be forced. Honesty can only derive from a willingness to be honest. A database of inspectors and agents who have been successfully sued could be published, but would this truly be a reliable determinant? We live in the age of frivolous lawsuits, a surreal business world in which McDonalds must serve tepid coffee, lest we victims burn our litigious laps. If the seller of a home fails to disclose a defect that was unknown to the agent and concealed from the home inspector, the attorneys still name the agent and the inspector as defendants in the suit.  And sometimes the juries rule against them, regardless of innocence of guilt.

In an imperfect world, “buyer beware” remains the essential caveat for those who purchase a home. The best way a buyer can beware is to find an “Advocate” for an agent and a home inspector with a reputation for thorough, accurate, unbiased inspections.

Choosing the Best Type of Smoke Alarm

Choosing the Best Type of Smoke Alarm

The House Detective: by Barry Stone, Certified Home Inspector

Dear Barry:  I installed new smoke alarms in my home about a year ago. Now that I’m selling the property, the buyer’s home inspector says these are not the best kind of smoke alarms. He recommends replacing them with the “photoelectric” kind. As long as the smoke alarms work when tested, what difference does it make if they’re one kind or another?  Ben

Dear Ben:  The purpose of a smoke alarm is to detect minute particles in the air and to make a loud noise when particles are present. There are currently three kinds of detectors on the market: ionization detectors, photoelectric detectors, and combinations of both.

When smoke alarms came into common use in the 1970’s, the only kind available was the ionization type. Ionization smoke detectors contain a small amount of a radioactive substance known as americium-241. This material creates a small electrical current between two metal plates. When smoke particles pass between these plates, the current is interrupted, and the alarm is activated. The problem with ionization detectors is that they respond best when there is a flaming fire but are slow to respond when there is smoke from a smoldering fire.

Photoelectric smoke detectors were developed in more recent years and have a different means for sensing the presence of particles in the air. In a photoelectric detector, there is a light source and a light-sensitive electric sensor. The light, however, is not directed toward the sensor. When smoke particles are present, the light strikes these particles and is reflected against the sensor, and this activates the alarm. The advantage with this type of smoke alarm is that it senses fires that are in their early stages of smoldering, before they burst into flames. This can make a life-saving time difference in many fire situations.

For maximum fire protection, dual alarms are available. These contain ionization and photoelectric sensors in a single unit. Unfortunately, there are no industry standards for the sensitivity of sensors in dual sensor alarms. Because of this, the ionization sensors in some dual alarms are not reliable. However, as long as the photoelectric sensor is functional, the alarm meets national standards established by Underwriters Laboratories.

Photoelectric smoke alarms are recommended by the International Association of Fire Fighters (IAFF) because they are the most reliable and give the most advanced warnings when a fire begins to occur. The IAFF regards ionization alarms and dual alarms as unacceptable. This is why your buyer’s home inspector recommended that you upgrade to photoelectric smoke alarms.

Upgrading your smoke alarms may not be a legal requirement in your local area or in your purchase contract, but it is still advisable. It is also recommended that you get combination alarms: the kind that detect carbon monoxide (CO) as well as smoke because CO alarms can save lives and are now required near bedroom entrances and in other interior locations. If you do replace the current smoke alarms with combo alarms, find the ones that have a voice recording, indicating whether smoke or CO has been detected.

Electrician vs. Home Inspector

Electrician vs. Home Inspector

The House Detective: by Barry Stone, Certified Home Inspector

Dear Barry:  Before buying my home, I hired a home inspector, and he reported no problems with the electrical subpanel in the bedroom closet. After moving in, I hired an electrician to install some light fixtures in the kitchen. He said the breaker panel was made by Federal Pacific, a brand that has been recalled as a fire hazard. He also said the panel had burn marks on the inside. At his urging, I let him replace the panel at a cost of $2880. After this, I called my home inspector to demand that he pay for the repair, since he failed to report these problems. The old panel had been thrown in the trash, but the inspector came over and showed me photos that he had taken of the panel during his inspection. The panel was actually a General Electric, not a Federal Pacific, and it had no perceptible burn marks. It now seems that my electrician was lying, and I’m wondering what to do. What do you think about this mess?  Karen

Dear Karen:  This situation has a number of complications and  uncertainties. Here are the main issues:

1)  You are faced with opposing testimonies from the home inspector and the electrician. The electrician says the panel was a Federal Pacific and had burn marks. The home inspector says the panel was a General Electric and did not have burn marks. Unfortunately, the old panel is no longer available as evidence. The home inspector, however, has presented photos to support his position. Apparently, someone is not telling the truth. Therefore, it is necessary to ask the question, “Does the home inspector’s photo depict your breaker panel or a panel from another property?” It may or may not be possible to answer that question conclusively.

2)  Competent home inspectors routinely disclose Federal Pacific breaker panels as potential fire hazards, especially if evidence of overheating is apparent. Failure to make such disclosures is a matter of professional negligence. If your electrician’s claim is correct, then your home inspector was at fault. If his photos are authentic, the electrician is at fault.

3)  Another issue involves your initial demand that the home inspector pay for the new breaker panel. When you were told that the panel needed replacement, you should have notified your inspector before having the panel replaced. A home inspector should have the opportunity to review a contested situation, to answer for what may or may not have been an error in the course of the inspection. Some home inspection contracts actually specify the right to see a claimed defect before it is repaired. The fact that the inspector was not given a chance to see the problem may absolve him of liability, regardless of whether he was at fault.

4)  A cost of $2880 to replace a breaker panel is excessive. The panel itself probably cost less than two hundred dollars and probably took less than a day to install. When you weigh these numbers, how much was your electrician charging as an hourly wage? From this perspective, the electrician appears to lose credibility.

In view of the inexplicable cost for the new panel and the photo evidence provided by the home inspector, it appears that the electrician may owe you a refund and a humble apology. Otherwise, he should provide a convincing explanation.

Aerobic Floor Vibrations

The House Detective: by Barry Stone, Certified Home Inspector

Dear Barry:   Our house does not have a foundation problem, but the living room furniture used to shake when we would do our morning aerobic exercises. So we installed some steel posts under the joists to make the floor more rigid. Unfortunately, this is a problem now that we are selling the home. When the buyers’ home inspector saw the posts, he reported that they need concrete footings and permanent attachment to the framing. If we had never added these posts, there would be no problem. What should we do, add footings, take the posts out, or what?  Belinda

Dear Belinda:  Removing the posts after the home inspector made his recommendations will probably raise suspicions with the buyers. Adding concrete piers may or may not be necessary, but it may be the path of least resistance for selling your home. The only other approach is to get an opinion from a structural engineer.

The home inspector, when faced with an unusual installation of this kind, had reason for concern, but he should not have drawn conclusions that exceed his professional expertise. Unless he is a licensed structural engineer, he was exceeding the scope of his inspection by prescribing specific types of structural repairs. Instead, he should have recommended further evaluation by a licensed structural engineer. That would be the proper course of action for a home inspector.

If the living room floor used to flex when you did your aerobic exercises, the joists may have been over-spanned when the house was built. In that case, the posts that you added may have been necessary, and having them secured in a proper manner may now be an appropriate upgrade. 

Another House With An Unpermitted Addition

The House Detective: by Barry Stone, Certified Home Inspector

Dear Barry:   You’ve written before about additions that are not permitted, and now we’ve bought a house that has that problem. No one told us about this before we bought the property, and now we’re stuck. Realistically, what can we do? Should we tear down the addition and rebuilt is with a permit? If so, who is liable for the costs, the seller, the agent, or home inspector, or all of the above?  Joanna

Dear Joanna:  If the quality of the unpermitted construction is reasonably good, an as-built permit is probably the best course. An as-built permit can be obtained from the building department. A municipal inspector will come to your home to evaluate the work. If the additions are approved, you can try to recover the permit costs from the sellers. If the work is not approved, the inspector will provide a list of improvements to be made to obtain approval. Worst case scenario would be that the work is so substandard that the building authority orders demolition of the addition.

Regardless of the outcome, the sellers should have disclosed that the additions were not permitted. However, it is also possible that the additions were built before the sellers owned the property and that they were unaware of the lack of permits. Therefore, it is important to determine when the additions were built. If the sellers were aware of the unpermitted additions, they should be liable for the costs to remedy the situation. Unfortunately, you might have to hire an attorney to enforce that liability.

In most cases, Realtors are not qualified to identify which portions of a building are original and which are added, unless they are given that information by the sellers.

Whether your home inspector is liable for professional negligence depends on whether pertinent defects involving the additions were visible and accessible at the time of the inspection.