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Home Inspections 101 for Real Estate Agents Instructed by FIRSTNAME LASTNAME PowerPoint Presentation
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Home Inspections 101 for Real Estate Agents Instructed by FIRSTNAME LASTNAME

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Home Inspections 101 for Real Estate Agents Instructed by FIRSTNAME LASTNAME

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  1. Home Inspections 101 for Real Estate Agents Instructed by FIRSTNAME LASTNAME

  2. Course Objective To leave you with: • A good understanding of the home inspection process • Information about how to manage your client’s expectations of the home inspection • Information about how to increase your client’s satisfaction and reduce your liability

  3. A Home Inspection Completes the Sale Information gathered from an inspection helps bring buyers and sellers together: • Information leads to knowledge • Knowledge leads to understanding • Understanding leads to agreement Inspectors should understand their role in the sales process. Buyers, sellers and real estate professionals all have a role in the sales process.

  4. Goals of the Home Inspection • To share unbiased information about major components and safety issues • To discuss repair, maintenance or safety issues beforehand • To move the sale forward

  5. Informed Home Buyers • Most buyers know little about construction • Answering questions puts their minds at ease • Informed buyers are more satisfied and can better anticipate and plan for repairs and maintenance • Real estate professionals can focus on the next sale

  6. Common Documents Associated With a Home Inspection • Pre-inspection agreement: Defines the scope of the inspection, standards followed and fee charged • Home inspection report: Should be clear and concise and incorporate photos

  7. Home Inspection Report Formats Home inspection report formats vary: • Checklist or narrative • Combination checklist and narrative • Computer-generated • Handwritten • Oral (from a friend with no report) • May or may not include summary • May or may not include photos • Delivered at time of inspection or later

  8. Home Inspection Report Basics In any case, reports should: • Be clear and concise • Adhere to the industry standards of practice as per major trade groups (ASHI, NAHI, InterNACHI) • Cover all major components • Be delivered in a timely fashion (such as within 24 hours) • Define terms used therein: (e.g., “acceptable,” “marginal,” “defective,” etc.) Who owns the inspection report? The client.

  9. Professional Home Inspector Characteristics of a good inspector: • Trained, thorough and unbiased • Courteous and professional, and has the necessary tools and equipment • Has good written and oral communication skills • Insured, and, if applicable, licensed

  10. Insurance Coverage for Professional Inspectors • General liability insurance • Should carry E&O insurance • Many E&O policies have a “referral” endorsement

  11. Inspection Reduces Complaints and Liability Chart Provided by FREA

  12. What an Inspector SHOULD Do • Generally adhere to industry standards of practice and code of ethics (ASHI, NAHI, InterNACHI) • Inspect readily accessible systems and components • Report: • Systems or components that aren’t working properly • Recommendations to correct • Explanations of the deficiencies • Reasons with fact that certain systems or components were not inspected

  13. What an Inspector Should NOT Do • Predict remaining life of systems or components • Offer advice on methods, materials, costs to fix components unless qualified to do so • Offer to make repairs, refer specific contractors or receive referral fees • Comment on market value • Perform code inspections

  14. Educate the Home Buyer

  15. Order a Home Inspection • Immediately after reaching a written purchase agreement with a home seller • Advise the buyer of what to look for in an inspector • Advise the buyer where and how to find a good inspector

  16. Explain the Scope of the Inspection A good inspector: • Explains the scope and limitations of an inspection: visual review of readily accessible areas, random sampling of like items, etc. • Invites the buyer along for the inspection • Explains how long the inspection might take, what it will cost and when the home buyer can expect delivery of the inspection report • Touches on his/her training, experience and affiliations

  17. Set Realistic Expectations • Very few homes are in perfect condition • This sale went through even though the house had severe wind damage because the buyer understood what had happened

  18. Preparing the Seller

  19. How to Prepare for the Property Inspection • Secure pets • Turn off alarms • Remove obstructions to: • Furnace and water heater • Electrical panel • Attic • Garage • Crawl space, etc.

  20. After the Inspection A good inspector will: • Leave things the way he/she found them • Verify that the furnace/AC is running and return thermostat to original setting • Turn off lights or running water • Make sure doors are locked, etc.

  21. The Inspection Process: Grounds

  22. Grading and Drainage • Great curb appeal: But the inspector is looking for positive drainage • Water is the No. 1 issue with most homes • Need positive drainage (slope) on all four sides • Most drainage issues are easy to fix

  23. Driveway, Walkway and Steps • Loose or missing handrails (inside or out) are a safety issue • Driveways/sidewalks/patios can have tripping hazards: • Heaving • Differential settlement • Excessive gaps

  24. Porches, Stoops, Decks, Balconies and Patios • Ledger board should be bolted to the structure not just nailed. • Railing should have proper height and spacing • Railings and hand railings should be firmly attached • Support posts and stair stringers should have no earth-to-wood contact • Decks can be expensive, but are fairly easy to repair

  25. The Inspection Process: Exterior

  26. Exterior • Trees can abrade roofs, as well as heave driveways and sidewalks • Tree roots can affect foundations, sewer lines, etc. • Other vegetation should be kept away from siding, air conditioners, etc.

  27. Roofing System Inspection of roof: • Estimate age • Number of layers • Type of materials • Leaking or not? • Types of valleys • Flashing

  28. Chimneys Chimneys are a frequent maintenance issue and can be expensive to repair. Inspectors check for: • Proper alignment • Proper height • Flashed properly • Lined and capped

  29. Siding and Trim • There are many exterior coverings, such as wood, vinyl, stucco, brick, stone and synthetics • Some are more high-maintenance than others • Vegetation can affect siding

  30. Windows and Doors Inspect for: • Operation • Alignment • Weather-stripping • Evidence of leaks

  31. Pools, Hot Tubs and Spas • Swimming pools and hot tubs are high-maintenance • Could involve filters, skimmers, gas, electric or solar heat, a pool house, etc. • Self-closing gate with a 6-foot-high security fence is a must

  32. Irrigation System Sprinklers are mostly out of sight, but not out of mind: • Underground leaks/erosion can greatly affect driveways, sidewalks, etc. • Poorly placed heads can lead to water intrusion in the basement, etc. • In the best case, sprinklers are high-maintenance

  33. Miscellaneous Inspections Some inspections might require specialists: • Well inspections • Septic inspections • Potability tests • Seawalls, private docks • Other: termite, radon, mold, etc.

  34. Garages • A single garage door such as this one receives a lot of use • Examining the operation, tracks, springs, openers and fit is important • For child safety, auto reverse is a must

  35. The Inspection Process: Electrical System

  36. Electrical System Inspectors check for adequacy and safety including: • Amperage/voltage • Service cable • Panel • Branch circuits • Grounding • Wire conductor • GFCI, AFCI • Smoke detectors

  37. GFCI Current standards require GFCI protection: • Bathrooms • All kitchen countertops • Unfinished basements • Garages • Crawl spaces • All outside electrical outlets

  38. Smoke Detectors • National safety standards require smoke detectors • Can be battery operated, hard-wired or both • Can be monitored by security company • Some areas require one outside each bedroom • Some areas now require one in each bedroom or living area • Inspectors activate test button only

  39. The Inspection Process: Other Systems

  40. Plumbing and Fixtures • Water is the No. 1 concern: plumbing and plumbing fixtures are a significant part of the inspection • Inspector is looking for leaks, adequate flow and pressure • Also checking for sluggish or plugged drains

  41. Plumbing System Plumbing leaks can also damage: • Cabinets/vanities • Behind shower tile • Subfloors, ceilings below, etc.

  42. HVAC System Check for adequate heating (gas furnace): • Overall size, age and condition of unit • Proper location of unit • Adequate combustion air • Adequate temperature rise • Heat source in each room • Condition, size and location of ducts • Condition of blower/humidifier • Heat exchanger (mostly hidden) • Check for flue gases and other leaks around exhaust and in supply air • Dirty filters obstruct flow and affect temperature rise • Thermostat unit responds to controls

  43. HVAC System Check for adequate cooling: • Overall size, age and condition of unit • Outside unit, clean, level and up off the ground, suction line insulated • No obstructions interfering with unit • Discharging heat-ambient test • Adequate temperature drop (14 to 22 degrees F) • Blower clean and variable speed • Dirty filters obstruct flow and affect temperature drop • Thermostat unit responds to normal controls

  44. The Inspection Process: Interior

  45. Kitchen • Cabinets: Countertops, tile and backsplashes • Stoves: Operable burners, not timers • Disposal: Inspect for smooth operation, excessive noise • Dishwasher: Condition, leaking, proper air-gap device • Ventilator: Recirculating or nonrecirculating • Other Built-ins: Microwaves, trash compactors, refrigerators

  46. Bathrooms • Can be one of the most expensive areas to replace or refurbish • With simple maintenance, expensive repairs can be avoided

  47. Walls, Ceilings and Floors • Walls, ceilings and floors can be covered by a wide variety of materials • Inspector checks for deflection/tolerance in floors, bowing or cracking in walls, cracks, stains or wet spots in ceilings • Operation and fit of doors and windows from the inside

  48. Additional Inspection Services: Water Quality

  49. Water Quality/Potability Testing • No water is pure. • Water quality testing is often required when purchasing a home with a private well system. • Companies that supply municipal water supplies regularly test for water quality. If you have a private water supply, then water quality testing is up to you. • Many states require certain water tests on private well systems as part of the lending process when buying or selling a home.

  50. Well-Water Contaminants • Water that enters a private well system starts as rain or snowmelt • The precipitation percolates through the ground and eventually into the well • On its way, it can pick up contaminants. Some common contaminants include the following: • Improperly maintained septic system • Use of fertilizers/pesticides • Fuel spills • Industrial or commercial activity • Improper waste disposal • Many contaminants are invisible to the naked eye and do not change the appearance of the water