Housing Inspections Ain't Insurance

Posted by Steve on Thu, 07/02/2015 - 12:57pm

Recently, I discovered a terrific binge-watching series on Netflix, Holmes Inspections. I don't care much for home improvement shows.  They're either too cute or too elementary or they leverage painfully poor architectural taste.  This Canadian show, features a general contractor, Mike Holmes.  What I like most about this show is that it focuses on fixing problems created by bungling contractors and overlooked by incompetent home inspectors -- two topics with which I strongly relate.  The show no longer airs on HGTV but fortunately there are a bunch of old ones streaming on Netflix now. They're a wake-up call for anyone looking to purchase a home, new or otherwise.

I learned my lesson about bad contractors years ago. It's why I try to do most of the work myself. It's taken me years but I've assembled a short list of professionals I trust when I encounter a job I can't handle myself. 

But the home inspection game is a crap shoot.  Your bank wants the house inspected before they'll approve the mortgage and finding one is usually on you.  Chances are, you're moving to an area where you don't know any trades, let alone any house inspectors.  What most people do is ask their realtor for a recommendation.  This is a huge mistake.  Your real estate agent isn't going to recommend anyone who could potentially queer the sale and the inspector probably has an ongoing business relationship with the agent he doesn't want to alienate.  So guess whose interests aren't being served? Yours.

Every episode on Holmes Inspections is about how new homeowners got screwed by a parade of shoddy existing construction and capped by a bad inspection which ended up costing them tens of thousands of dollars to fix.  Some of the examples are egregious, like missing stair railings, no plumbing or roof vents, obvious water damage and mold infestation and sagging porches which the inspector passed with a "well, it's an old home".  So wrong.

Holmes' show has obviously struck a nerve with Toronto-area home inspectors because at least one of them released a video attacking Holmes' credibility: https://www.youtube.com/watch?v=kg0iPVF-SZw  I suspect that this unnamed inspector was the featured bonehead in one of Holmes' episodes.  He nitpicks about how Holmes tested where a leak was coming from, using a garden hose.  Laugh all you want, buddy, butt it's a technique that waterproofing companies use as well.

I've bought two homes in my life and was screwed by incompetent home inspectors both times.  A casual Google search for "incompetent home inspector" will produce pages and pages of results.  It's a real problem.

My first house was a rushed sale. I visited it for only fifteen minutes before the real estate agent had to leave for an important meeting elsewhere.  I wasn't allowed access inside again until closing. In retrospect, that should have been a red flag.  I lived two hours away so I was completely dependent on the inspector, who wouldn't give me a firm appointment.  "Don't worry, I'll send you a detailed report with pictures".  The report I got cited things like "I'd like to see more roof vents" and "there was evidence of mice in the garage".  It was nerf ball stuff that didn't raise any alarms with me, however I was a little off-put by the "pictures" in the report.  They were just a couple of polaroids taken from outside of the house from a hundred feet away.

It took just 24 hours in the house to uncover the first layer of hell...stuff which should have smacked a professional home inspector in the face.  The brick chimney on the new addition was separating from the house.  The homeowner had attempted to hide the gap and water damage with joint compound and a fresh coat of paint.  But paint and saturated drywall don't mix so it was pretty easy to see.  Not in the report.  And it wasn't that there weren't enough roof vents.  There were no roof vents, either at the peak or in the soffits.  As a result, the attic was full of mold.  Not in the report. The washing machine wouldn't drain so  I went out in the snow, looked in the crawl space and saw the uninsulated PVC drain poking down from the laundry room.  Worse, it was pitched the wrong way so any water trapped in it would freeze, leaving the washing machine useless until spring thaw.  And just to spike the ball on the stupidity, there was no vent on it either.  Not in the report. But the biggest scare was opening the basement door and finding a family of raccoons staring at me on the stairs.  The crawl space was open to the basement stairs!  I didn't even want to think about the possibility of the snakes I'd find hibernating down there.

Over the next couple of weeks, I tried to reach the inspector in vain as even more problems appeared: a wood stove without a spark arrestor venting next to cedar shakes, light switches that didn't work, a missing downspout, an overloaded fuse(!) panel, a buckling floor next to an outside door.  I started asking around about the guy and found that his brother was the skel who did all that crappy, unpermitted work in the house!  Of course he wasn't going to return my calls.

Could I sue him?  My lawyer said probably not.  The fine print in the contract immunized him six ways from Sunday.

So it was with a lot more skepticism that I hired the inspector who did my current house.  I pretty much assumed I was going to get lied to but since I'd already planned to upgrade or renovate just about everything in the place I didn't much care.  This inspection was for the bank.  I mostly cared about a solid foundation and a roof that wouldn't leak for at least the next year while I began the rehab.  The foundation was exposed in the basement and I could see that it was solid bluestone with no apparent water infiltration.

Otherwise, my inspector missed at least a dozen bullet items on the list I'd created just on my first visit to the house, including the fire-prone Federal Pacific "redhead" breaker panel and a sloppy garage roof deck rebuild which pitched towards the house and was drained by an old vacuum cleaner hose to the floor drain inside the garage. Most were clear code violations, like extension cords stapled to the woodwork and live outlets mounted in the floor.  There was a scrounged 16" iron railing around the living room deck, just tall enough to ensure a trip hazard and a face plant on the sidewalk nine feet below. 

None of this was in the inspector's report.  So I talked to him about and his alibi was "It's an as-is sale, right?  The seller made it clear he's not going to fix anything. If I put it in the report and the bank sees it, you don't get the house."  Sigh. Didn't matter.  All these problems were living on borrowed time anyway.

But there was one more curve ball.  In NY, the seller is required to produce a termite report. His inspector failed this house.  So an exterminator was called and produced a letter certifying that he had killed two termite colonies.  My inspector confirmed it: no termites.  Two months after I moved in, my cat, Chopper, was clawing at something on a basement stair stringer.  I saw that he'd pulled off a decent amount of paint.  What I saw next horrified me -- lots of little, white worms.  Termites!  I traced the damage back through the exposed beams with an awl.  The stairs were eaten up.  So was the lip on the stair landing. So was the cross beam in the basement ceiling all the way to the opposite wall. So were two more beams. And so was the illegal wooden platform that a basement toilet was built on to give it pitch to the drain.  In fact, that's where the termites entered the house. Good job, Inspector Dave!

I hired my own exterminator who chuckled at the other exterminator's certifying letter.  How do you certify killing a termite colony that could live twenty feet below ground and two hundred feet away?  How could he tell that the colonies he allegedly killed were the ones eating my house?  Evidently, you can't.  A complete basement gutting, fogging and a perimeter treatment fixed it.  The new six-inch 5000psi concrete floor over plastic should discourage future attacks.

So what's a prospective homeowner to do?  If you can't trust your inspector to be your expert pair of eyes on the largest purchase you're likely to make in your lifetime, who can you trust?

The first rule is don't hire an inspector recommended by the real estate agent who's selling you the house.  That's a huge conflict of interests. 

Make sure the inspector is a member of the National Association of Home Inspectors (NAHI) and is licensed and bonded.  It won't guarantee that he's competent but it at least demonstrates some professionalism.  You can get a list of local members from NAHI.

Ask tough questions: how long has he been certified, how many homes has he done, does he have prior experience as an engineer or general contractor? 

Knock on some doors in the neighborhood and find the last couple of people who bought in the area.  Ask them who they used and if they were happy with the inspection report.

Be there with the inspector and prepare yourself with a list of things you find questionable.  A little water in the garage may not seem like a big deal now but it could be if it's coming from a crumbling cornice or missing gravel stop at the roof line.  Count and test the electrical outlets, fill the bathtub  and see how long it takes to drain. If it's winter, check for even heating throughout the house, loose banisters. Look for water spotting on the walls and ceiling and pay particular attention to fresh paint.

If you have any nagging questions, hire an engineer to look at it.  That's what I did because of my concerns about excessive checking on a large wood support beam in the basement.  Victor confirmed that it had to go and recommended a steel I-beam.  I wasn't NOT going to buy this house at that price but I wanted to know how deep I was going to go into my pocket.  At that point I was up to around fifty grand in basics, which was still a bargain in this rapdily gentrifying neighborhood.

Finally, watch Holmes Inspections!  There's a pattern to what Mike Holmes looks for when he enters a new job site and you can learn it too.