What is the role of your Real Estate Agent with regards to your home inspection?

But first, some background.

The home inspection business is a strange industry because home inspectors have so little control over our businesses.  This is the only industry that we know of where some companies market to people who don’t pay them. Those people that we market to are called sales agents or Realtors, and while the great majority of home inspectors market to Realtors, it is Home Buyer, like you, who pay for our services.

Although we like, and respect, most of the Realtors that we work with (see here), there are a few that we choose not to work with anymore, and there are more than a few who choose not to work with us.  We believe that Realtors referring home inspectors to their Clients can create a conflict of interest.

Here’s why.

When a buyer purchases a house using a Realtor, someone pays that Realtor. Indirectly, it was the buyer (you) paying the commission, through a higher price on the home. That higher price pays the commissions for both the listing agent and the buyer’s Realtor. We believe this creates a conflict of interest because the buyer’s Realtor might not necessarily be seeking out the best home inspector for their client. This is even more important when the same Realtor is representing both the buyer and the seller, which is a clear conflict of interest that no one seems to care much about.  But we do.

Unfortunately, we at Decker Home Services have been asked to “go soft on the house” or to “downplay” certain items, and even to “omit” certain items by some Realtors.  We do not do it, “and we haven’t heard from those Realtors since.  And, no, we didn’t report them to their local Realtor® association, nor to the State of Illinois Department of Real Estate; we just don’t have time to be the Realtor police.  You can see, though, that with the high price of real estate, Realtor commissions at a standard 3% each for both the listing agent and the buyer’s Realtor® means $9,000, each, on a $300,000 condominium, or $15,000, each, on a $450,000 house.  Why would a Realtor want the best, most thorough, most complete, most ‘nitpicky’ home inspection for the buyer when this might mean more problems and headaches in any ensuing negotiations?  And sometimes all that ‘nitpickiness’ means that the buyer decides not to go through with the purchase.  Then the Realtor has to find a second house for the buyer without having been paid anything for all the work just completed on the first house.  You can see how vicious it can become?

In fact, the two largest national home inspection associations (NACHI and ASHI) and the National Association of Realtors have a prohibition in their Code of Ethics against home inspectors paying for referrals by Realtors.  Still, many Realtors call me, every week, and ask that they be paid for referrals.

Decker Home Services (and NACHI inspectors in general) has developed a reputation throughout the greater Chicagoland and suburban area as being “too nitpicky”,”too thorough”, and, sometimes, “deal killers.” (The saying goes, “Home Inspectors don’t kill deals, but some houses commit suicide.”).  Our company has had only one Client complain over the years about our thoroughness, but we have had many Realtors® phone us and call us certain names and state that they will never refer us again. So we’re asking for your help.

First, the best kind of advertising is word-of-mouth.  People who are happy with our services refer us to their friends and family.  This advertising, we are proud to say, accounts for just over half of our business.  If you feel that we did a good job and exceeded your expectations, drop us an e-mail and we will post it on our ‘Client’s‘ board, tell your friends and take the time to post a review of our services on consumer boards like Angie’s List or on the Better Business Bureau.

Secondly, talk candidly and frankly with your Realtor.  Make sure that they know that you, the Client, are in control the process.  Make sure that your Realtor knows that you know that they are licensed by the State of Illinois for certain duties and that your Home Inspector is also licensed to perform their own duties.  You would be in sorry straights if you had your home inspector prepare a sales contract on a house for you.  Likewise, you would also be hurting yourself if you allowed your Realtor to inspect or direct the inspection of the house you are thinking of buying.

Good Realtors do their jobs well.  Good Home Inspectors also do their jobs well.  Make sure that you know that you are hiring both a good Realtor and a good Home Inspector!

And if, for some reason, you are unhappy with the home inspection we did for you, please contact us. Your unhappiness doesn’t do either you or us any good.