Fall Real Estate 2003

Publication Date: Wednesday, October 8, 2003

Look before you leap
Home inspections can turn up unexpected problems

by Karen Imamura and Nisha Ramachandran

Before Vatsala Sarathy bought her house in Palo Alto three years ago, she had a home inspector look over the property. Among the things she learned: The air conditioner was not on level ground. It wasn't a serious problem, but it was one that Sarathy says she wouldn't have known about without that inspection.

Home inspections often take the surprises out of buying a new home. Inspectors are trained to identify problems that may not be visible to the prospective buyer or seller. A basement that has flooded will leave telltale signs, such as water marks or mildew. A tree that is growing alongside the house and has branches touching the structure might lead to deterioration later.

While other people say, "location, location, location, we say location, location, condition," said Bruce Howe, Palo Alto-franchise owner of HouseMaster, a home inspection company located in both the U.S. and Canada.

Local real estate agents agree that home inspections are helpful. "This way, both buyers and sellers are aware of the issues that have to be addressed," said Manlynh Rummler, an agent at Alan Pinel Realtors.

Locally, it is standard practice for sellers to conduct both a general home and termite inspection.

"In this market, where we are surrounded with such sophisticated buyers and sellers, it is really unusual not to have a home inspection," Rummler said.

For a seller, house inspections are a way to identify any issues that may creep up during a sale and to potentially fix those defects before the property is listed. Many real estate agents will get bids on the work that need to be done on the house, such as roof or chimney repair, so that both the seller and the buyer know how much repairs will cost.

"The seller gets an inspection before putting the home on the market so they won't be surprised after the fact," said Suzanne Jonath, a real estate agent with Coldwell Banker.

Home inspections by the seller can also speed up the purchasing process. When a property comes on the market and there are more than two bids on the house, a seller may use that house inspection to give competing buyers a general idea of what the property is like. This way, a buyer may offer to bid on the house without taking an extra few weeks to analyze the property personally

"If you know you're going to be in competition with another buyer, sometimes it's hard to know what the property is worth without that inspection," said Dante Drummond, a Coldwell Banker agent in downtown Palo Alto, who has been in the real estate business for 25 years.

Real estate agents recommend that buyers also undergo their own home inspection prior to purchasing a property in addition to whatever the seller may offer.

"There aren't any disadvantages to home inspections. Buyers should always use due diligence when buying a home," Rummler said.

Buyers can obtain a better understanding of the property and address any problems that may occur with the home with a home inspection.

"Home inspectors try opening and closing every door -- those kind of things that are kind of mechanical but can be an issue once you buy the house," said Sarathy, who is looking for a new home in the area.

"A home inspection can be pretty technical sometimes, but it's up to the buyer to decide what should be fixed by the seller, what the handyman fixes and what they (the buyer) can live with," she said.

Home inspections also allow what might seem like a significant problem to be looked at objectively

"The buyer may see something that is very alarming and they may consider it to be something that is far more serious than it really is," Drummond said.

Not knowing what condition seldom-used items are in is easy to overlook for homeowners. Plumbing leaks or duct work under the house might need attending to, but the current owners might have not noticed a tiny change in water pressure or ventilation.

"There are a lot of broken chimneys in this area, after the '89 earthquake," Drummond said, explaining that the inspector will go onto the roof and be able to rock the chimney back and forth.

Buyers typically conduct at least a general home inspection, which will detail the overall condition of the house, and a structural pest control report, which could reveal problems such as dry rot or conditions that could cause infestation. Drummond also recommends that buyers conduct a pool inspection if applicable and a soil inspection if the property is located on a hill.

A typical inspection by HouseMaster takes about two and a half hours while inspectors look at about 400-500 items and complete a 21-page report that covers a variety of things. Instead of being at the mercy of the seller, buyers are able to see exactly what condition the house is in. All parties involved are encouraged to come along in person on the inspection.

"They will get more value from the inspection if they can actually see the things," said Howe, referring to the buyer, seller and real estate agents, "instead of having the items read back to them verbatim."

An inspection done by HouseMaster can run anywhere from $350 to $400 or more depending on the size of the house.

Nisha Ramachandran is an editorial intern at the Weekly. You can e-mail her at rramachandran @paweekly.com.

"There aren't any disadvantages to home inspections. Buyers should always use due diligence when buying a home," -- Manlynh Rummler, Alan Pinel Realtors agent