All buyers have a duty to protect themselves in a home purchase, including the investigation and verification of information and facts of the prospective home’s physical condition. Most of the time, professional services are employed by the buyer to conduct inspections, and a home inspection can be an important factor in the transaction for both the buyer and the seller.
Inspections can cover such issues as the general condition of the property, and its systems and components such as the foundation, roof, plumbing, heating, air conditioning electrical, mechanical, security, pool/spa condition and operation and other structural and non-structural systems and components including appliances.
There may be other specialized inspection services needed to inspect for pests and termites, to confirm boundaries, check soil stability, well and/or septic systems or other matters of concern to the buyer. Other reports may be needed for natural and environmental hazards, such as seismic, flood or fire hazard zones. The Buyer’s Inspection Advisory should always be made part of a purchase agreement, which informs the buyer of various professional inspection services that the buyer may want to consider in evaluating the property.
Under California law, Realtors have a responsibility to conduct a reasonably competent and diligent visual inspection on the property, regardless of who they represent, and disclose to the prospective purchaser material facts affecting the value or desirability of that property that their inspection reveals. There are some exceptions to this duty. We don’t get on the roof or go into the attic and our X-ray vision is horrible, and we don’t test systems.
In addition, sellers have an affirmative duty to disclose issues known to the seller that may affect the buyer’s evaluation of the property and the buyer’s decision whether to buy the home. While there can be exceptions for bank-owned properties recovered by foreclosure or probate properties where the seller has not lived in the property, most residential properties are covered by the seller’s obligation to make a full disclosure on property condition.
While it isn’t yet common in our market area for the sellers to make their disclosure package available to a prospective buyer prior to the agreement of the parties on a purchase, other housing markets do have that standard of practice, and I think it is a good idea. Most savvy buyers and their agents will ask if there is a disclosure package available before writing an offer, and savvy sellers and their agents will prepare a disclosure package in advance of an offer.
Once issues are identified by disclosure and inspection, they may become subject to further negotiation between the parties, with the Buyer wanting repairs, an adjustment to the purchase price, or a credit in escrow so that the buyer can make repairs later. The buyer may also decide to withdraw from the purchase on the basis of inspection results or disclosure items or other matters, within the buyer’s investigation contingency period.
All properties have issues, and some are major and affect the buyer’s willingness to purchase or they can be relatively minor or cosmetic in nature. The main take-aways are: 1) The buyer has a right to know what they are buying and to that end, they have a responsibility to make investigations on their own behalf, and disclosures and various reports can be obtained; and 2) the sellers have a responsibility to disclose issues that may affect the buyer’s valuation of the property and their decision to buy.
Ray “the Realtor” Kutylo is the team leader of the SCV Home Team at Keller Williams VIP Properties. The Team brings experienced and professional service, commitment and value to every transaction, whether you are a home buyer or seller. Ray can be reached at (661) 312-9461 or by email at firstname.lastname@example.org. The views expressed are his own and not necessarily those of The Signal. CA DRE 00918855