Should agents recommend home inspectors?
Q: Your often-repeated advice that Realtors should only recommend the most thorough home inspectors, is dead wrong.
Real estate agents should never recommend home inspectors, contractors or any other professionals. They should tell their clients which ones to avoid and maybe give them a list of available contractors, but absolutely never should they recommend anyone in particular.
Realtors are not shills for other trades. If homebuyers want to hire a home inspector, they should make an effort to find one on their own. Realtors who recommend home inspectors place themselves in a compromised position and deserve all the legal grief they get.
A: The lawsuit-laden landscape of today's business world has made perspectives such as yours inevitable.
Everyone, from doctors to plumbers, from storekeepers to contractors, from Realtors to home inspectors, must live in fear of legal liability, avoiding the good, old-fashioned practice of honest referrals.
In short, they must conduct business and frame every spoken and written word with a wary eye toward potential lawsuits. Signed contracts must precede every action, service must be impersonal, and Realtors must never recommend specific professionals: all as a means of reducing liability. On the other hand, is diminished service to clients truly the best answer to liability exposure? Is the withholding of qualified recommendations to homebuyers and home sellers the best way to limit legal risks? What, after all, is the ultimate objective of real estate professionalism? Is it to avoid litigation or to serve the needs of clients? Perhaps high-quality referrals are the best way to reduce liability?
Most buyers have no idea how to choose a competent home inspector. They rely on their agent for this kind of referral. Agents who recommend high-quality inspectors are less likely to have disclosure claims after the close of escrow because the inspectors they recommend are more thorough.
If buyers are denied a referral by their agent and happen to choose an inexperienced or incompetent inspector, undisclosed defects may be discovered after the close of escrow. If legal claims are raised over those issues, the agent will not be insulated from liability, regardless of who provided the referral.
In such cases, a buyer’s attorney could allege that the agent knew the buyer had chosen a negligent home inspector but elected to say nothing. My previous advice therefore bears repeating: “Realtors should only recommend the most thorough home inspectors.” It is the best way to serve the needs of clients, while reducing liability.
Q: I sold my house last year and the buyers are now suing me for what they say is a faulty foundation. I supervised the construction of the house and subcontracted the work to licensed contractors. Every phase of the job was approved by the city inspector. What should I do?
A: The first step is to have a licensed structural engineer inspect the foundation to determine if there is truly a significant problem. Your attorney should arrange a date when you can have experts of your choosing evaluate the property. An inspection by a highly qualified home inspector is also recommended.
• Distributed by Action Coast Publishing. Questions to Barry Stone can be emailed to barry@housedetective.com.