The practical value of a home inspection reportBy John Graham
In this era of Google and instant information, the estate agent still has a vital role to play in the property sales process. Internet sites may provide property information, virtual tours and comparative market analysis, but at the end of the day most people still want the human touch – someone they trust to hold their hand – when making a major purchase such as a house.
This provides an opportunity for the estate agent to reinvent himself/herself. No longer should the agent be a hard-bitten, self-seeking sales person, but rather a wise councilor who is able to facilitate all of the information which sellers and buyers require to make an informed decision.
It is for this reason that wise agents are embracing the growing role of accredited, balanced home inspection reports as a vital ingredient in the property sales process.
With the Consumer Protection Act (CPA) now law, sellers and their agents are exposed to the perils of collapsing sales and even litigation if full disclosure of all material information is not made upfront to potential buyers.
Buyer now havethe right to know everything material about the property they are buying. More and more buyers are going to be insisting on this right and demanding full disclosure up-front. This is best achieved through a comprehensive and objective third party inspection of the property.
Most sellers are not qualified to document all defects in the house. It is quite possible that the seller is not even aware of some defects which would be easily spotted by the experienced eye of a qualified home inspector.
Estate agents generally know more about property that their sellers, but they are also not experts in building matters. Yet the CPA places an obligation on the professional estate agent to declare all defects and other material issues (such as zoning and unapproved structures) to the consumer (buyer).
The only logical and sensible future course for South African estate agents is to identify South African home inspection companies who consistently produce balanced, professional reports (not nit-picking deal-killers) and then to take the initiative and recommend these home inspectors to their clients – both sellers and buyers.
The agent’s role is to reassure the sellers that a home inspection is a good idea. A good home inspection report, which is used as an annexure to the Deed of Sale,releases the seller and agent from the threat of potential litigation.
The home inspection report isalso very reassuring to buyers and the transparency of the process engenders trust and goodwill – thereby facilitating the sales process.
There is every indication that, with the advent of the CPA, South African banks will soon start insisting on a home inspection report because finalizing bond finance. The last thing a bank wants is to attempt to unscramble an omlette should a disgruntled buyer use the CPA to try and cancel the sale after transfer has gone through.
Home inspectors can be either a friend or a threat to estate agents. Wise agents will embrace the process and take the lead in positive upfront disclosure by recommending home inspection reports to their clients.
In the final article of this series we will examine the fact that there is no turning back the tide of consumerism sweeping through the property industry. Agents must either become enthusiastic advocates of transparency and full disclosure or risk being perceived as selfish salespeople.
John Graham is the CEO of HouseCheck. He can be contacted on 083 3109 766 or [email protected]