If your market is like mine, there are few listings and competition between buyers includes negotiating away the home inspection. Although we are still holding our own in total market share, we are down about 45% in Q1 so far.
On two separate occasions, Realtors with whom I have a strong relationship have asked me if I would consider accompanying their buyer when they tour a property (for a fee) to provide feedback on certain aspects of the property like roof age & condition, HVAC, electrical & plumbing components, appliances, etc…, to assist the buyer in deciding whether to proceed with an offer (knowing an inspection will be taken off the table in negotiation). To which I replied, “Oh, Hells No”.
Desperate times, desperate measures and all, I started to wonder if I am missing an opportunity. I wondered, what would that be worth ($$$), how much time would it actually take (no report writing) and, what are the legal ramifications? Assuming a “Not An Inspection” contract could be written, the dollars were worth my time, and the logistics could be worked out, could this be a stop-gap measure in difficult times?
Curious if anyone else has done this type of “consulting”…
The buyer clearly wants an inspection, but can’t get it.
You could view is not as an inspection, but as fee for service. Charge for time and materials, straight up hourly fee, with no reference to Nachi or standards of practice, and no written report. You will not have “inspected” but your expertise is still valuable. Importantly it’s not a service the client needs an inspector for: any contractor would do as well. As such you’re not plying your trade directly.
I think the dangerous ground would be treating it as a limited scope inspection.
But walking through a property with the buyer is not such a thing.
You can do something for your tenant visually without an inspection, and if they’ll pay for it, and it helps them, you might consider doing it. Don’t quote a low hourly figure. Your time is valuable, and this should not be regarded as a way to get a cheaper product, but rather a way to work around a market constraint.
Are you in this profession for the long-haul?
Sure, you are helping the realtor and (non)-client to make a sale/purchase, but what’s in it for you?
Reduced fee? Sounds like they want everything “evaluated” without paying the full inspection fee!
Also… you just have to know that you are setting a precedent with the realtor for the future… that full inspections are not needed as long as someone is starving and willing to work for less!
You know all that BS we deal with in regards to what realtors want/expect from us? Well, guess where they got the balls to demand it from us… from kowtowing inspectors begging for scraps!!
IMO… we should be charging FULL FEE, and if they want to accept less for that fee, that is their decision to negotiate it away!
Walk n Talk, verbal consult etc. are becoming popular. I think they are a legal minefield but I will do them occasionally. I actually prefer not to have an agreement. No photos, no recording devices and my hands stay in my pockets.
Do you know your state home inspection rules verbatim?
If you do not, this is the first place to start. We cannot recommend any guidance without knowing what these rules are and how they apply to doing a modified home inspection.
For me, my state requires that I inspect and report on everything listed in those rules, unless otherwise agreed upon by contract with the client. My report template is set up to answer all the state regulations and requirements for a home inspection. If my client requests part of that inspection is not to be completed, the state rule requires that it be documented as to why it was not completed. I.e. not inspected upon client’s request. Done!
You should incorporate in your inspection agreement the scope and purpose of the inspection you are conducting for that specific client. I would also recommend that you put the same verbiage in the inspection report because the two documents may not follow one another.
The SOP tells you what a home inspection is; if your clients request does not fall within those guidelines, it’s not a home inspection and you can do whatever you want (unless there is another licensing requirement involved to conduct such an inspection).
As for the fee, the only discount that is appropriate is the five minutes you didn’t spend writing the modified report. Yes it’s probably only five minutes. Where you probably save the most time is not putting all kinds of fluffernutter in the report that nobody asked for, and which should be in there in the first place probably. So, if you’re doing a walk and talk and there is no report involved, you better have a pretty good contract to show to the state as to why it is not a home inspection.
If there’s no report, there is no documentation of what you said or saw. They are giving up their right to complain about you. It’s like a verbal agreement/contract in court. Your biggest concern would be why there wasn’t a written inspection report if a complaint should make it to the state, they may have some questions for you. We better have that pretty well covered a proposal/contract document. Or just play Sgt. Scholz, “I saw nothing”…
If I do use a written agreement, it starts with this:
Client understands and agrees this consult will not meet “Standards of Practice” for a home inspection. Because of the limited number of components evaluated, this consult will not meet any other organizations Standards of Practice for a home inspection.
Actually Marc, I don’t believe that to be true. I know this Realtor very well - she has been instrumental in my success and has never tried to manipulate the process. She is acknowledging a major shift in the market (temporary, I hope). Many sellers refuse to accept a contract from a buyer who insists on a home inspection. She knows the inspection contingent in the real estate contract will probably be questioned in the negotiation (against her advice) affecting her buyer’s place at the table. She’s trying to get some professional advice up front BEFORE the negotiation and she thinks that has value up to the cost of an inspection - even without a report.
This is the key phrase in your statement. Thanks David. SC SOP is from ASHI. As you stated here, what I am considering in this different approach isNOT A HOME INSPECTION and the agreement, signed in advance will discuss the difference.
I completely agree with jjonas, it’s the precedent that it sets and becomes the new expectation. Also consider after the move in when something doesn’t function (since it’s a visual walkthrough). Walkthrough agreement or not, it will be someone else’s fault and they start questioning you. In the eyes of the agent, you came up in a problem the client is having and it would keep shining a negative light on you weather you are to blame or not dwindling that relationship. Agents don’t want to be associated with issues and all it takes is clients continuously pointing the finger regardless of that document that they signed that they never read and act like they don’t understand when something goes wrong.