Collusion between real estate agents and home inspectors

By Barry Stone

Basically, there are two kinds of real estate agents: Advocates and hucksters. Advocates are the honorable standard bearers of a profession that is often unfairly maligned. Advocates are those who represent the best interests of their clients; who actively promote defect disclosure; who recommend only the most qualified home inspectors. Advocates would rather kill a sale and find a better property for their clients than have the clients be unhappy after the sale. Advocates treat clients as they themselves would want to be treated, with honest concern for the clients’ financial well-being. Advocates know that fair treatment of others attracts future business.

Unfortunately, there are also the hucksters, the snake oil salesmen, as it were, who jeopardize the interests of homebuyers, who keep attorneys busily employed, who denigrate the hard-earned reputations of the honorable advocates, and who boycott the most qualified home inspectors. Hucksters represent their own financial avarice at the expense of their clients. They compromise the disclosure process by seeking home inspectors who are less likely to provide full defect disclosure. They recommend inspectors who are less experienced, less capable, or who are willing to exchange principal for increased business. A huckster would rather close the sale than jeopardize the immediate flow of commission checks. To a huckster, top-notch home inspectors are known as “Deal Killers.”

Among home inspectors there are two variables that affect the thoroughness of disclosure. The first is professional competence. Inspectors with higher levels of knowledge, skill and experience are simply more thorough than others. But regardless of ability, we find the same ethical contrasts that define agents: either a total commitment to the client’s interests or a greater concern for immediate cash-flow. Hucksters recognize this difference, and some have learned to exert subtle pressures. Nothing overt; just a simple hint such as, “We just want to know that everything is structurally sound, so please don’t be nit-picky.” Another favorite is, “This deal is important; so we need a really good report.” Inspectors who ignore these coded messages needn’t expect future referrals from those agents. The choice then is clear: become a “street walker” for unscrupulous agents or rely strictly upon the referrals of advocates.

Finally, there is the question of ethics enforcement by associations such as ASHI and NAR. Professional integrity among home inspectors agents can be influenced and encouraged, but it cannot be forced. Honesty can only derive from a desire and willingness to be honest. The only other inducement to be good is the fear of litigation. We live in the age of frivolous lawsuits, a surreal business world in which McDonald’s must serve tepid coffee, lest we victims burn our litigious laps.

In an imperfect world, “buyer beware” remains the essential caveat for those who purchase a home. The best way a buyer can beware is to find an “Advocate” for an agent and a home inspector with “Deal Killer” reputation for thorough, accurate, unbiased inspections.