Anyone have this problem?

Home buyers sacrificing inspections.doc (24.5 KB)
This is the trend in Calgary at the moment. Homes are being listed on a Monday and have up to 14 offers by Tuesday.
Sellers are taking unconditional offers meaning, that the buyer is foregoing the home inspections.
Is there a way of turning this in a favorable way for inspectors. Inspections have dropped off dramatically.
Further to this, new home construction is being capped and resale homes are going at a premium. (29% increase since 2005). Due to this, houses are selling up to $25,000 over their list price.
As this is the first time I have tried to submit an attachment, I hope it comes through for you to view.



The best thing you could offer in such a case is a walk-through. You could offer for a flat fee to attend with the purchasers upto 3 homes of their choice ($350-400) that they are going to view in order to put an offer in.

Disclaim that inspections do not meet industry standards and any information given by you is verbal only. As you are literally doing a walkthrough with the clients you will spend approximately 20 minutes in each home if that.

Better they have some form of protection then none at all. Any purchaser who partakes in a bidding war with no conditions is asking for trouble. It is a dumb idea to be backed into a corner, but its legally okay. The demand is setting the conditions.

And any association that you belong to that says walk throughs are not permissable does not comprehend market conditions. As long as you disclose you are fine. I would still get clients to acknowledge a contract stating it is verbal and provided on a visual inspection only. Of course you cannot take your equipment so you can look in the attic, or remove electrical cover, etc, your clients may appreciate they have not been left high and dry with no protection. You can alert them to possible concerns before they submit the inflated price offer.

This is not new, it happens all the time, the present market conditions have just made it worse but this will change. The scenario will be, buyer buys home in a hurry, waives the home inspection, buys a pile of junk… oops, who do we blame now?

Next time they buy a home they will insist on a home inspection.

Don’t try to cut corners it will only make the whole industry look bad. It makes my toes curl thinking about the things you can miss doing a walk through. Let the buyers and Realtors dig their own holes, we don’t have to be in their with them.

In the meantime, if you are losing business put up your prices. Yes you heard me, put up your prices because the people you will be serving will be the ones who realize the value of an inspection and won’t carp over the price.

An inspection our company did a little while ago enabled the buyer to shave $250,000 off the purchase price (on a $1,750,000 home). Do you think they were bothered by the insignificant fee we charged?

The problem is the home in these situations are sold as is or no inspection permitted because they know there is a smuck who will take a chance. Clients are foolish to become hooked up in such deals but people and their money are soon parted.

Have done walk-throughs due to circumstances. As long as client understands the limitations, a partial inspection is better than nothing.

While I agree prices for inspections are undervalued/priced, having a high price will not necessitate call for inspection when the terms of the contract dictate the terms which are beyond our control. Vendors just won’t accept inspections in such a situation when they know they can make more than asking price with no conditions.

The Edmonton market is a few months behind the Calgary market so we will have to deal with this, this summer. Anybody that buys a house that is not inspected is nuts.
8 years ago, I hate to admit this, but I bought a house without getting it inspected. I paid too much, the furnace was leaking CO and I damn near died. The CO monitor finally went off 10 weeks after I moved in. By then I had lost 20 pounds, was sick with a throat infection and was white as a ghost.
Maybe that experience had something to do with becoming a home inspector.
The realtor asked me if i wanted an inspection and I said no. If she had not asked I would have sued.

Fools rush in where angles fear to tread.

I guess there are a lot of nuts out there! :slight_smile:

This past week in question period in the Alberta ledge One or the opposition members asked the government what they were going to do about house builders returning the purchase deposit so they could sell the house to someone else for more money. Houses have gone up 20% in the last year.
The government (forgot which member) replied that the buyer should make sure that the contract to purchase covered their needs and protected their investment.
In other words **Buyer Beware. **
This same thing was happening back in the seventies.

I hope you all don’t mind if I contribute…

my real estate agent said that most banks are lending without requiring an inspection now. They are placing the risk on the client. It’s a shame. There is going to be a huge backlash. So the best thing I think is to educate the public, because most people who don’t know better will jump at the chance to skip the inspection.

Thank you for allowing me to comment.


Here in my area of south western British Columbia, the market is predominately Asian, - various ethnic back grounds.

Most of these people do not under stand the value of paying for quality work.
Many homes are not being inspected.

And most of the people when they do get inspections go for cheap priced inspections - probably through trainee inspectors or part time fly by night inspectors.

I have also heard from purchasors that phone, that the banks, ie: most likely the mortgage personnel, are telling them to not pay more then $250.00 for their inspection.

99 % of the phone calls I get, the only question asked is how much ?

You should tell the banks to stop ripping of consumers with their high fee schedules and crummy interest rates on deposit. Now you know why the banks have had tremendos profits over the years.

I hate banks!

I have increased my business substantially after reading the business success tips and other marketing articles on this site. Also read the Inspectors Quarterly report. I do not follow all the tips but the ones I have tried have worked very well. The people that are looking for a discount usually have backgrounds that was their way of life.

Unfortunately, its the norm in a sellers market to quickly close a deal; few conditional offers accepted. I was recently in Calgary, out there it seems many homes are actually selling higher than the asking price. Home inspection is viewed as one of those conditions causing delays, so often the inspection clause becomes an automatic deal breaker.

Goodbye Inspection, Hello Trouble
For buyers, waiving the inspection contingency is rarely worth the risk.

Finally, a buyer’s purchase offer might contain a right to have a professional inspection even though approval of the inspection report won’t be a contingency of closing the transaction. If the inspector uncovers substantial problems, the buyers can attempt to find another way to cancel the escrow.

Re: Anyone have this problem?

Here i was thinking this was just another Viagra sales pitch.

This can be what happens with no inspection . Roy sr


Province called on to force home-sellers to disclose property’s problems Last Updated Apr 5 2006 09:52 AM CDT
CBC NewsA Winnipeg woman who was unpleasantly surprised by problems with her recently purchased home says it’s time the provincial government legislated mandatory property-condition reports on houses put up for sale.
Brenda Corrigal says property-condition reports, in which sellers have to disclose anything wrong with their homes, would protect homebuyers like her from signing off on a house with serious problems.
In February 2005, Corrigal bought a three-bedroom bungalow in the south St. Vital area of Winnipeg for $93,000 – almost $20,000 more than the asking price.
Corrigal was in a bidding war over the home with nine other people, and her offer – like many made in Winnipeg these days – had no conditions, such as an inspection or a disclosure document about any problems with the property.
Water drips down walls, pools in basement
On the day after she and her two young daughters moved into their new home, Corrigal says the insurance company called, saying it couldn’t provide collapsed-building insurance due to concerns about the roof.
“That same day there was a quote in my mailbox from a roofing company that the previous owners had asked for an estimate on the roof,” she said. “So they obviously knew that work needed to be done on the roof.”

Mould grows behind a damp wall in Corrigal’s home. (Photo courtesy Brenda Corrigal)
Corrigal hadn’t seen the roof at the time of the home’s purchase because it was covered with snow, although she says the realtor told her the shingles on the home’s roof were about 10 years old.
In the year since she moved in, Corrigal says water started dripping down walls in her hallway and her daughter’s bedroom. In the kitchen, water started dripping from the kitchen ceiling and pooling in the light fixture above the dining room table. In the basement, Corrigal says water seeped through three walls until it was ankle-deep.
Corrigal says the previous owners told her, after the sale, to expect some water in one corner of the basement – but gave her no other warnings. The home’s former owners maintain that they told Corrigal all she needed to know, and say it was up to her to have the home inspected before buying it.
Market too hot for home inspections: lawyer
Local real estate lawyer Jeremy Feuer knows all too well that few homebuyers insist on inspections in today’s hot real estate market. If they do, he says, they often lose the bidding war.
“If you have a family and you need to find a home, it may be the case that you need to waive any requests for a home inspection if you need to find a place to live,” he said. “In this competitive market, more often than not, purchasers are all but forced to waive any kind of inspection.”
Feuer has joined a growing number of realtors and real estate lawyers who say the province should give serious thought to legislating mandatory property-condition reports to protect homebuyers.
“It would give a purchaser full disclosure or … a lot more disclosure than they’re getting right now and make the entire process transparent, as opposed to flying blind, which a lot of people are,” Feuer said.
“Has there been any kinds of problems associated with water leakage of any kind, either from the property onto an adjoining property, or vice-versa? It requires the vendor to answer yes or no, and if yes, to offer an explanation and actually explain what those problems were.”
Repair bill to cost thousands
A few real estate boards in Ontario require mandatory property condition reports, and in other places, such as Nova Scotia, realtors are required to encourage clients to use these forms, although ultimately it’s up to the vendor.
As for Corrigal, she’s unsure what to do next, as her lawyer has advised her that a lawsuit would be expensive to pursue and difficult to win. She’s faced with thousands of dollars in repairs to her home.
“I have a lot of good family and friends that have kept me strong, but it’s been very hard, and I don’t know what I’m going to do,” she said.
"Even if, by law, I could sell [the house] the way it is now, in my heart I know I couldn’t do this to somebody."The more I hear,
the more I see!
NACHI is the one for me !
Roy Cooke R.H.I.
A HAPPY NACHI MEMBER,… More find this out ever day!

Thanks Ray and Roy

On the news today it was announced that in March 2005 the average cost of a single family home in Edmonton was $211,000.00. In March 2006 the average was $256,000.00.
These stats are from the Edmonton Real Estate board via CHQT 880 radio station.
The Mar 27-Apr 9 issue of Canadian Business Mag had an article on real estate investments where they report that:
Vancouver prices went up 26.5% to 490,004 Calgary up 26%, Edmonton up 15.5% to 211,531, Barrie up 6% to 232,450, Winnipeg up 19.6% to 146,000 Toronto up 5.9% to 353,928.
It’s interesting to note that can bus mag price for edmonton was the price for March 2005.
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Why invest in the stock market when you can buy a home and get a better return?

There has been talk about making home inspections mandatory. I don’t think you will ever see this happen in Ontario.