EP #12: How Much Risk Are You Taking When Skipping a Home Inspection?
Episode #12: How Much Risk Are You Taking when Skipping A Home Inspection?
Charlie
Trade Secrets inspections podcast, because you need to know. Here’s your host, Rick Kooyman.
Hey there, Charlie McDermitt back in the Trade Secrets Inspections studio with none other than Rick Kooyman. And Rick, how are you?
Rick
I’m excellent. Today, it’s great to be with you again, looking forward to another topic of discussion to help people with their purchasing.
Charlie
Without making that big mistake with this crazy, crazy market. There’s a lot of not only is the market crazy, but the actual decision to purchase without doing maybe maybe checking all the boxes that we normally would do in a market that hasn’t been as insane as this one. So love this topic today, Rick, and looking forward to you guiding us so that maybe we don’t regret or at least suffer from the “Oh, my gosh, what did I do” , that buyer’s remorse after you sign the dotted line, right?
Rick
Yeah, exactly. You know, the, like you said, the market is really hot today, prices are skyrocketing. Demand is crazy high and supply levels are at like, all time lows,.It’s a calamity of impossibilities coming together to create this storm of buying that’s going on. So people are out there. There’s lots of people that want to buy. So you know, there’s lots of competition. And that brings on the rushed processes, essentially. So what used to be a 15 day offer period has now been cut back to, you know, as little as three days.
Charlie
I was gonna say 15 minutes?
Rick
Yeah, really, if that’s what you could get away with a with with that. You know, and to some extent, maybe we can help with that. So I wanted to talk about that a little bit today, and, you know, help people out with some of their options on how they can better make buying decisions, I guess, you know, yeah, yeah, that’s great, because it really is a product. So
Charlie
a fine line, because I know a lot of folks have, have made many, many, many offers. And, you know, I probably each time you get more and more aggressive, but, you know, I there, I’m sure there are things that can be done to kind of help mitigate the risk, right?
Rick
Yeah, for sure. You know, and like you said, you know, after you looked at 10 houses and, and put in offers on them all and lost them all the frustration level gets pretty high. And, you know, people are going way over asking prices, they’re doing, you know, escalation clauses in their offer. So, you know, that it’s a perpetual bidding war, I mean, it’s really kind of insane. You know, so if you’re gonna make those moves, and you’re gonna do it without an inspection, there’s, there’s a good bit of risk you’re taking there. And I got a couple examples of some things that I’ve seen happened to a few clients that were bout to go down that route. And then at the last minute, had a few minutes to get us in there in a day or two. And, you know, we found out some stuff about those properties, and they ultimately walked away. So you know, these things can affect you. And then, and then there’s some options for what we can do to kind of expedite things and maybe help people out a little bit. So, you know, just just a couple of examples of some things that I’ve seen, I went and did an inspection on a property that looked conditionally beautiful, it was clearly an older home that had been remodeled and all fixed up, and, you know, great showing beautiful house beautiful lot, lots of people making offers on it, you know, they were really, really excited to buy this house. And we went in and went through it. And ultimately, there wasn’t much wrong with it, except for there was not one building permit on it from its original construction back in 1986. You know, and it was like, wow, there’s only one permit on file for this home that’s been renovated, added two new roof, you know, pool, you name it. And it’s just, whoa, whoa, on here. Second, maybe you want to think about that again, you know, and they didn’t appreciate it at the time, but after they took some advice and made some calls and our, you know, couple of days later, they decided that that was, well, too much risk to take for what was a beautiful property, you know, so it was kind of like, an unseen issue, you know, really, really kind of closet issue, if you will, but not often pointed out until it’s too late. You know, maybe, maybe you get it in title. You know, your title agent might bring it up when they’re going through but I really don’t think they will either because they’re just looking to make sure there’s no black things, there’s nothing hanging open or unclear or stuff like that. So,
Charlie
and even if they did, they may not explain the significance of
Rick
yeah, they probably don’t even know themselves exam. So everybody involved was kinda in the blind about that, right? You know, until I said, Hey, guys, hold on, let’s talk about this for a minute.
Charlie
Yeah, I mean, personally, I had no idea and and I didn’t learn about that until we started doing this podcast and I’m thinking, holy cow, I would have never, never asked never thought of it. It’s one of those things you’re buying a home permits why,
Rick
right? And then ultimately, you know, insurance gets involved in you’re like, What do you mean, you don’t want to insure it, because I can’t prove anything’s age or anything like that, or, you know, there’s just, there’s all kinds of problems that lie with that one. Another one we’ve seen was, you know, the same idea of, of a nice looking house, nothing to see. But when we did the air sample tests, you know, it came back with mold all over it, which is, you know, toxic mold. So, just because it was cleaned on, you know, and painted, painted, being now tomorrow there doesn’t mean that the problem was resolved. And again, you’re going to buy something that’s going to cost you a large amount of money as soon as you get into it and remediation costs. And, you know, a simple $250 test reveals, worlds have changed opinions on things. Let’s put it that way. Another good one down here we see often is insect damage, wood destroying organisms, you know, people are pretty wary about termites, and they are a big deal down here. But you know, there’s, there’s all kinds of stuff that can be invasive to a home other than a wood destroying organisms, you know, you can have invasion of ants, and roaches, and animals, raccoon, I mean, you name it, I’ve seen it in an attic. So, you know, necessarily want to buy those things, I don’t think. They can be cleaned up, I guess.
Charlie
can you charge him rent? I mean, the raccoon, Are they alright?
Rick
That’s good. So a couple of things we can do, you know, a simple, we can do an abbreviated inspection, you know, if we have a real short time window, and you just want to have a basic kind of breakdown of what’s important to insurance, we can do essentially a four point inspection for you, instead of the insurance company, which is going to tell you what it is insurance is going to think about that property. So that’s one of the primary important steps I think, is understanding the risk of how difficult it is to get insurance and keep insurance in Florida, as well as finding the property and getting the offer accepted. So there’s, there’s kind of another page to the purchasing process there. That, you know, we can point out those things in an abbreviated inspection or the four point inspection. One other option you have, that is not real. Well, honestly, it’s kind of a new thing in the industry. Because across the country, you know, the markets gone crazy in real estate. So the inspection industry’s been trying to adapt, and, and help out in whatever ways we can. And we came up with a means of doing what we can call a walkthrough inspection. So essentially, you can schedule with us to go on open house visits or on showings, and we’re going to go through with you and we’re not going to open anything, we’re just going to do a visual inspection. But it’s kinda like, Wouldn’t it be cool if you knew what your home inspector did when he was going in buying a house? How would he look at it, you know, just when he was going through it, so we can kind of do that for you. So we’re going to go through it, take a look at it through our eyes and just say, Hey, this is what I see here, there, you know, nothing written down. It’s not about saving you a bunch of money on inspections, costs, it’s just about getting the risk lowered in a timely manner. So, you know, maybe you can make the offer. After you know, we’ve gone through and discussed it. So yeah, you’re a little safer when you go ahead and say, well, we’ll do it. No contingencies, no inspections, , you know, there’s no guarantees in anything, but it definitely can be helpful. And yeah, you know, and if you think you’re out, and you’re looking for an advantage in the buyer side, you know, think about scheduling ahead of time for you know, when you’re going and looking and spending, you know, two 300 bucks on essentially renting our time for a couple hours and taking us out and seeing what we think about a couple of houses you’re interested in
Charlie
Good idea.
Rick
That’s those are options for you. One thing people need to know about when they’re buying, or they’re going into these contracts that are what people like to say, as is, you know, the house is as is, and we’re not going to do anything to it. Well, okay, that’s fine. You don’t have to. And we can agree that that’s the case. But you still want to have what what is in the legal world called the right to void. So before you go through closing, while you’re in escrow, you should still have the right to exit the contract without losing your deposit. So they might not agree to change anything. But you might come across things like no permits on file, and say, No, we changed our mind over the last 24 hours, you know, so big thing to keep in mind, if you are going to do an As-Is contract is make sure you do have the right to void, it is pretty well standard in most purchase agreements. But it can be excluded. And there are devious people out there who do try to tie people up as much as they can. So just want to point that out to people. So keep in mind, you can do those aggressive offers, you can plan for it, you can give us a call ahead of time, you know, and get some time on a schedule, and we’ll help you out or you know, even if you’re on a three day contract, offer, I’ve done many inspections next day, and you get your report that day. So if you’re on a 72 hour, contract, offer contract, you know, give us a call right away, and there’s a good chance we can get through it. And even if we got to squeeze in and just do an abbreviated four point inspection and get some information to you, then you know, by all means, I encourage you to do those things.
Charlie
Awesome. Great, great ideas, suggestions. Way to adapt, Rick, love it.
Rick
We’re here to help people. So you know, we just want to be here, let people know, you know, give us a call and let us let us help you out. Yeah,
Charlie
yeah, you know, again, I go back to the for most folks, it’s the number one biggest investment and to be rushed into such an event and even if it’s a second home, I mean, still it ranks up there as one of your I mean,
Rick
really, still a high percentage worth investment. So you know, it is one of the higher risk things and oftentimes people are really surprised by what’s hiding. What they didn’t know to think about.
Charlie
Yep. Alright, thanks again. We look forward to doing this again in our next episode.
Rick
Awesome. Great speaking with you again and can’t wait till next time.
Charlie
Thanks for listening to the Trade Secrets Inspections podcast. To learn more about Trade Secrets Inspections, go to www.TradeSecretsInspections.com or call 239-537-1186.
Transcribed by https://otter.ai