Should I Trust My Realtor Recommended Home Inspector?
Let's Face it... Your Agent Has More Experience Right?
At least when it comes to home inspections. We should hope so, they deal with home inspections and home inspectors every transaction they are apart of, from used homes to new construction. However, you should ask yourself if this is enough reason to trust their recommended home inspector when you are about to buy a house.
The potential problems with using your Realtor recommended home inspector...
Typically, agents will provide a list of preferred home inspectors to their clients. They recommend these inspectors based on their personal experience and track record of working with them. Buyers are then encouraged to choose one of the agent’s suggested inspectors or conduct their own research… but honestly who has time for that in today’s market?
However, have you ever stopped to consider the potential biases behind an agent’s recommendation for a specific inspector over others? There are several things to consider.
- First, real estate agents do not disclose the criteria they used in developing their short-list of inspectors. As a buyer, you have no way of truly knowing if the selection process is impartial or if agents are recommending people who serve their best interest, i.e. who will protect their commission and not be a potential obstacle in the path towards closing.
- Second, your agent, despite how friendly and personable, ultimately has a personal financial interest in your decision to buy a property. The average real estate agent commission is 6% of the property’s sale price, split between the buyer’s agent and the seller’s agent. On a $300,000 property that’s $18,000, or $9,000 for each agent; THAT IS A SERIOUS AMOUNT OF MONEY. More importantly, that’s 9,000 reasons your agent wants the sale to go through.
- Last, due to the amount of money involved, agents are inherently incentivized to recommend home inspectors that will facilitate a seamless inspection process and get to closing. This sort of arrangement could be seen as an agent referring business to a home inspector in return for a clean bill of health on the home.
Can't I just take legal recourse against my real estate agent if they did do this?
Realtor’s will often show you a list of three realtor recommended inspectors, with the caveat of “If I were getting my own house inspected I would choose…” By providing a list of inspectors to their client they successfully shielding themselves from liability for the referral. All the while appearing to be giving you the power to make an informed decision. When in actuality, the agent is narrowing your home inspector options to ones they have believe will not hurt their sale.
How to find your own independent inspector
Not every home inspector will agree to work with real estate agents to adjust their reporting style to favor a sale. Interestingly enough, real estate agents will often steer client’s away from such inspectors. In private real estate agent’s refer to these home inspectors as “deal killers”
However, not all home inspectors who choose to work closely with real estate agents are directly serving the agent’s interest. In fact, a majority of competent inspectors are 100% loyal to their client’s interests.
How to identify if your agent is steering you away from a competent home inspector
- “That inspector is too expensive and takes way too long” – Quality inspections are not cheap because they bring substantial value to the deal for their clients. Moreover, why wouldn’t you want your inspector to take their time and conduct a thorough inspection on the home you’re about to purchase.
- “They are incompetent; that’s why they charge low fees” – Not all quality inspectors charge high fees, they may just be starting out or in a highly competitive area which keeps pricing relatively flat.
- “That inspector is tough, and we don’t work with them” – This should be alarming if a realtor tells you that they don’t work with a certain inspector. First off, it’s not their choice it’s yours. Secondly, a tough inspector is not afraid to push back on realtor requests to minimize issues found during an inspection and always prioritizes their client’s interests over their own. More importantly, over their agent’s interests.
- Or if you suggest using an independent home inspector not on your agent’s preferred short-list and your agent raises objections that make you suspicious of their underlying biases.
Instead of going with your agent's suggestions...
#1 Thing you can do as a buyer is to conduct your own Due Diligence before deciding on an inspector.
- Research their Google Business Page and read the reviews from previous clients.
- Review their website, is it professionally built or does it look cheaply done?
- Review their Sample Reports on their site to see the quality of their work and their reporting process.
Employ an inspector who has the following credentials:
- They are an independent home inspector.
- They use the most up-to-date equipment and possess the expertise to conduct a thorough assessment of every part of the home. Home inspectors that work closely with realtors tend to produce reports that are not comprehensive.
- They will exceed the minimum reporting standards outlined by the state. You can get this information by comparing the inspectors’ sample reports on their websites with the inspectors’ reports recommended by your agent.
- They will not necessarily be the cheapest home inspection company around. A home inspector that is potentially working closely with agents (too close perhaps) tend to keep their prices low as they are focused on volume and they do not want you to look elsewhere.
Please explore the rest of our site for more information regarding your inspection.
- Check out our Top Real Estate Agents for agents with proven track records
- See what it means to be an International Certified Professional Inspector.
- Visit our Blog for even more information.