Here at MC2 Home Inspections we have been noticing a very alarming trend over the last several years that needs to be brought into the light. It should come as no surprise that the vast majority of home inspections that are performed these days are on foreclosed homes or previously foreclosed homes that have been purchased and then “flipped” by an investor. The trend we have been seeing concerns finished basements and the intentional covering up of serious defects by either the homeowner or the investor selling the home.
Fully finished basements have long been a strong selling point for home sellers because many potential home buyers like the convenience of buying a home where the basement is already finished. Most home buyers never seemed to give it a second thought. In todays real estate market however, the rules are a bit different than they used to be. Anyone who is currently selling a home right now is having a very difficult time selling it thanks to the ever increasing foreclosure market. During the housing boom, a home would sell in less than 3 months. Now, however, it is not uncommon for a home to be on the market for a year or even longer. This is especially true for homes where home maintenance has been neglected or nonexistent. After all, who wants to buy a home inheriting someone else’s problems?
So herein lies the problem. What many sellers and investors have turned to is simply covering up all visible defects in the hopes that the home will sell faster. Sellers and investors are smart. They know that a home inspection is a “visual” assessment of the homes condition, so they are banking on many defects not being caught by the home inspector due to the fact that they are being covered up by new drywall, insulation and fresh paint.
What kinds of defects are being covered up?
Cracks on basement walls and other structural defects
Improper and unsafe electrical wiring
Holes in ductwork
The basement itself was finished improperly
These are just a few of the defects we have encountered while inspecting “finished” basements. As mentioned earlier, a home inspection is a visual assessment of the home and its components. Home inspectors typically do not move things around during an inspection due to the liability involved, i.e. damaging someone else’s property. Good home inspectors however, are suspicious by nature and know what to look for when inspecting finished basements, especially in older homes.
What you can do to protect yourself
One of the first things you should do prior to placing an offer on a home is to ask your real estate agent how long the home has been on the market. One of the oldest tricks in the books if a home isn’t selling is to take it off the market for a short period of time and re-list it. This makes the home appear to be a “new listing”.
Example: We ran across one home where it was on the market for over a year. The sellers took it off the market for a couple of months and then re-listed it. A potential buyer placed an offer on the home shortly after it was re-listed thinking it was a new listing. During the home inspection, it was discovered that the sellers had finished the basement during the time the home was off the market. It was then discovered upon closer investigation of the basement, that the seller had “covered up” multiple electrical safety violations and extensive mold. This would explain why the home was on the market for so long. Instead of repairing the homes defects properly, the seller instead chose to cover them up with new drywall and fresh paint in the hopes that the home would sell. Here is the kicker, in looking at the sellers disclosure, nothing was mentioned about the defects even though it was obvious they knew about them.
The next and absolute best thing you can do to protect yourself is to obtain a professional home inspection. I cannot stress enough the importance of having a home inspection performed on your potential new home. In this real estate market it is more important than ever to have a home inspection performed prior to purchasing a home. In most cases, your home inspector is your last chance and the only one who can help save you from buying a spit shined money pit. While you, your agent or a family member may be “home savvy”, a professional home inspector who has performed thousands of inspections in todays market has the instinct and the knowledge of what to look for and where to look. Don’t get caught inheriting the previous owners problems. Spending a few hundred dollars now can ultimately save you several thousands of dollars in “hidden” repair costs.