Promoting Time of Sale Inspections Is More Important Than Ever

In the midst of an overheated real estate market, the most important message to homebuyers is clear: Don’t drop the onsite inspection contingency!

Most of us have probably gone through the nerve-wracking experience of buying a home. It is often said that a home is the most expensive purchase you will ever make. As a caveat, I understand that might not be the case for onsite installer business owners who routinely make major investments in machinery to keep the wheels of commerce moving. 

But nonetheless, buying a home is fraught with many risks and potential pitfalls. Are you paying too much? Can you afford the mortgage payments? Are you going to like the neighborhood? Can you be sure there are no underlying problems with the home that could break your family budget down the road?

I have purchased several homes, and I’ve always at least addressed the last question in that list of concerns by hiring a home inspector experienced in uncovering construction issues to be dealt with before completing the transaction and moving in. And guess what? In each case, these inspections have brought to light specific problems that had to be addressed by the sellers or helped me reduce the purchase price of the home. And it’s never been just hundreds of dollars in issues to be resolved, but thousands of dollars. 

So needless to say, I’m a big proponent of the home inspection for buyers. Unless you are a construction contractor yourself, it would always be wise to hire an expert to look for insufficiencies in all the major components of a potential new home for your family, from the roof and gutters all the way underground to the home’s foundation … and the topic I’m most concerned with right now, the septic system. 

A few hundred dollars spent now can save prospective homeowners huge amounts of money down the road. Some of you currently offer point-of-sale septic inspections, and I’m sure you’ve been sharing this important message with homeowners as long as you’ve offered this valuable service. Unlike a leaky roof or peeling paint, getting the right read on the remaining life and previous care of a septic system requires an experienced eye … and I would say that even many general home inspection companies are not adequately trained to look for clues of an abused, neglected or failing onsite system.

Drop the inspection?

So a growing trend I’ve been seeing in this red-hot housing market is quite alarming. In an effort to beat competing bidders to the sale, homebuyers have been lifting contingencies for home inspections from their real estate offers. This is a desperate and foolhardy move given the grave financial stakes involved in such a decision. And one we in the wastewater industry should discourage whenever we have a chance. 

Forgoing time-of-sale inspections is getting to be a big enough problem that real estate agents like Julie Jalone in Roseville, California, are sounding a warning. Jalone, of Magnum One Realty, recently wrote about the importance of home inspections, and particularly onsite inspections, in hopes that prospective buyers would avoid the financial risks.

“The home inspection is the base and most critical contingency. The inspection is conducted by a neutral professional inspector to assess the major systems of the property. This will include electrical, plumbing, roofing and structure. Without this contingency, the buyer has no recourse on issues and problems with the house,” she explained on the Roseville Today website. 

“This is also true for waiving the buyer’s ability to request the seller to make repairs. This is an important secondary negotiation between the parties. Many sellers are now demanding ‘as is’ sales and the buyer agreeing not to ask for repairs. Buyers may consider this but should never remove the inspection contingency.”

Jalone said inspections are most critical for well and septic service. 

“Wells and septic systems are vital elements of the property. Issues with these systems can be health-related and expensive to fix. Septic system repairs can cost thousands of dollars,” she said. 

The money pit

We in the onsite industry know the stakes are even higher than Jalone realizes. What about the homeowner who learns after the sale that an aging system is failing and requires more than just a repair, but an entire system replacement? I’ll bet many of you have been the bearer of devastating news to recent homebuyers in this crazy market: “I’m sorry, you will need a new septic system. It can’t be installed in the same location as your existing system, and your lot isn’t big enough for a second drainfield.”

Alternatives in this case may be few and undesirable to the homeowner. If they’re lucky, you can design an advanced treatment system that will fit in the small footprint but will cost more than the homeowner is expecting. Or maybe a municipal system will soon be expanding into the neighborhood and could be accessed, also at great cost. Failing that, you don’t want to be the contractor telling the homeowner that a holding tank is their only solution. 

In a recent advice article, Dan Steward, president and CEO of Pillar To Post Home Inspections USA, also warned about skipping time-of-sale inspections. He shared a transaction story worthy of the 1980s comedy movie, The Money Pit, which followed the travails of a hapless couple (played by Tom Hanks and Shelley Long) who got more than they bargained for when buying that quaint house in the country.

Steward explained that a Brampton, Ontario, buyer waived the home inspection at the seller’s request to secure the deal. When the family moved into the house, they found out they had no well water supply.

“Worse, they discovered that they had to have the entire septic system replaced — at a cost of $120,000. This is something a home inspector would have easily caught. The couple eventually had to take out a mortgage just to pay for the new septic system,” Steward said.

Septic inspections can also save your customers from being caught up in a house-flipper’s nightmare like the one experienced by Army veteran Jonah Huggins in Florida. As reported by WFLA-8 in Tampa, Florida, Huggins bought a home renovated by a flipper before he discovered it was served by a septic system and not tied to the city sewer as the seller disclosed. The buyer spent $30,000 to connect the house to city sewer, money he was hoping to recover through a lawsuit.

Consumer education

What can you do through your onsite business to help consumers avoid these unfortunate situations?

First, figure out if the demand for septic inspections is being filled in your area. If there is a need and you don’t already offer inspections, consider adding it to your menu of services. Inspection service could be a valuable way to diversify your services and make great connections for future work. Who better for a homeowner to trust for installing work down the road than the contractor who provided a key inspection service in the past? 

If inspections are already part of the service you provide, make sure people know how important they are, even in this challenging buyer’s market. Promote your service and share real estate inspection tips through social media channels. Offer to present seminars explaining how time-of-sale inspections are conducted. Contact general home inspectors and offer to partner with them to lend your specific expertise in wastewater treatment where it would help. 

Network with local real estate professionals to build awareness about decentralized wastewater treatment. I have heard installers complain about real estate agents resistant to adding another layer of paperwork to the home-selling process. But real estate agents should understand that protecting both the buyer and the seller in this major transaction will reflect positively on their service and reputation as quality agents. It should be a goal of everyone involved to avoid disputes that wind up in the courtroom. Getting out in front of real estate agents with an educational message about septic systems would help your entire community.

It's about clean water

Inspections — both at the time of a sale or as part of a maintenance program — ensure two important goals that onsite professionals care about: a cleaner environment and protection of the onsite system owner’s investment. It’s troubling that buyers and sellers would give up this vital protection no matter how badly they want a sale to go through. And if this trend continues, both our groundwater and homeowners’ pocketbooks will suffer in the years to come.


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