Sellers

Governor Inslee's Executive Order on Energy Efficiency

Governor Jay Inslee has issued an Executive Order EO 14-04 yesterday that will mandate significant changes in how the residents and businesses of the state will obtain and use energy.  

The State Building Code Council is tasked with:

develop, and implement to the extent possible and consistent with state and federal law, a new statewide program to significantly improve the energy performance of both our public and private buildings, taking into account existing state and utility efforts. The program must accelerate the cost-effective energy efficiency retrofit of existing buildings, with a support system that provides information, consumer protection, and assistance to businesses and homeowners. The program must ensure that all new buildings are as energy-neutral as possible, with advanced envelopes, efficient appliances, on-site generation, smart controls, and other features, where practicable.

This change will affect rental property first as evident in the third bullet point:

Support vulnerable and low-income populations through weatherization assistance, setting minimum standards for rental housing energy efficiency, . . .

I fully expect that the provisions that Governor Inslee has set forth will lead to large changes in the manner in which homes are constructed and the way that remodeling is done. I also anticipate that these changes will be relatively expensive to implement.

Prep Season

We've cleared the holidays when everyone in real estate takes some time off. No one wants to move at Christmas so many folks don't have their house on the market, waiting instead until after the New Year. In other words, now. I'm starting to see a strong uptick in seller's inspections as folks prep their house for entry into the market. Something to consider is that the first audience for your home is the other real estate agents. Once listed, they'll be touring your home so that they can be ready to refer their clients to appropriate properties.

If you have any little projects (and maybe some big ones) that you want to complete during the late winter/early spring, talk to your agent about waiting until the projects are complete before putting the house up on tour. First impressions can be critical and you don't want to jump the gun.

And, if your agent has suggested some repairs, I strongly recommend that you consider them. They know what is concerning to the buyer - they work with them daily.

For more advice on sellers inspections, check out my posts here.

 

 

Cracked Heat Exchangers

Cracked heat exchangers are not just expensive - they can be dangerous as hell. First, background. A gas-fired furnace (oil, too) has two different air-handling systems. The one most people think about is the blower that moves that wonderful warm air through the house on days where the temps, like today, are in the single digits.

The second system is the air supply for the burning of the gas. The furnace needs this air for combustion. The resulting flue gases are a mix of the air, minus a goodly portion of oxygen, and the fuel, minus a goodly portion of the chemical energy. That's where the heat comes from.

To get it into the house, we need to move the heat from the combustion cycle to the air-handling equipment. That's the role that the heat exchanger plays. It's a shell of metal that contains the noxious gases of combustion. The walls of the exchanger heat up and transfer the heat to the air driven by the blower.

The old furnaces from the 1960's and early 70's had thick shells and some of those old Lennox's can be hard to kill with anything short of a bazooka. Newer furnaces, especially the ultra-high efficiency condensing furnaces, don't last nearly as long. The new ones have much thinner shells and, to create greater surface area for the heat transfer, lots of dimples in the surface. Consequently, they tend to suffer metal fatigue faster than the old furnaces. Failures in heat exchangers have been reported in units that are only 15 years old.

Back to the noxious gases. What happens when the heat exchanger cracks? Well, we no longer have a separation between the gases and our interior air, the atmosphere that we breathe. The flue gases escape into the living 2013-11-30 Harder (85)spaces. The principal gas? Carbon monoxide.

The reading on my handy little toy there indicates that the furnace is releasing 16 parts per million of carbon monoxide. As a reference, at levels above 9 parts per million, carbon monoxide begins to affect health. At 35 parts per million, it becomes toxic. These are based on 8 hour exposure cycles, about the amount of time you spend (hopefully) sleeping.

There are a couple of things that you can do to protect yourself. First, have the furnace serviced on a regular basis and make sure you specify that the heat exchanger is inspected for cracks. While you would think that it would be routine, my experience in this area is that it isn't.

Second, install carbon monoxide detectors. They are relatively inexpensive. In older homes, it is perfectly acceptable to use either the plug-in type or ceiling mounted battery operated detectors. In newer homes in Washington State, they are required to be hard-wired into the home.

A special note for people selling homes in Washington State - you are legally required to furnish the home with detectors when you sell your home. This applies even if you are doing it as a for-sale-by-owner (FSBO).

If you are a buyer, I strongly recommend asking the inspector if he uses a carbon monoxide detector during his inspection. They're not foolproof - even if I get acceptable readings on mine, I'll request the heat exchanger be checked by an HVAC specialist - but they are very useful. A good inspector should have one.

Finally, what can be done about cracked heat exchangers? Replacement of the furnace, generally. That's the part that is expensive. It beats being one of the 500 people who die every year from CO poisoning, though.

 

Crawl Space Access

Crawl space access is one of those completely unsexy things that inspectors get excited about - and with good reason, since we get paid to go in there. Most homebuyers take one look at the spider webs and confined space and pat me on the back. "Good luck, take pictures." seems to the general idea. They're not coming with me. Accesses get placed in all sorts of interesting spots - outside, in the garage, through a basement wall, closets - you name it, someone has put it there.

Okay, not the attic. We'll save the discussion of attic scuttles for another time. . .

The code for crawl space access is pretty specific.

R408.4 Access Access shall be provided to all under-floor spaces. Access openings through the floor shall be a minimum of 18 inches by 24 inches (457 mm by 610 mm). Openings through a perimeter wall shall be not less than 16 inches by 24 inches (407 mm x 610 mm). When any portion of the through-wall access is below grade, an areaway not less than 16 inches by 24 inches (407 mm x 610 mm) shall be provided. The bottom of the areaway shall be below the threshold of the access opening. Through wall access openings shall not be located under a door to the residence.

Did you read all that? No, don't worry. The inspector will manage it. Heck, we're delighted if we actually get a code-compliant hatch in an older home. Some that I've gone through are a half or less of the size above. It's why you should always hire a skinny inspector.

No, the part that will drive the inspector nuts and possibly cost you money (if you're the buyer) or a sale (if you're the seller) is having a perfectly acceptable hatch that isn't accessible.

Don't Cover or Block the Crawl Space Access

Yesterday was a classic example. We have a home with a sloped floor, a large tree five feet from the foundation wall, and no way to check the crawlspace for structural damage because the hatch was in the laundry room. Under the washer/dryer.

Very few inspectors are going to move installed appliances, risking damage to the appliances and the flooring, to get to a hatch. Instead, most will write it up as a defect, mark the structural components as uninspected and leave the buyer guessing about sloped floors.

The longer they guess, the worse the problem will get in their minds.

If you are the seller, please do yourself a favor. First, know where your access is. If it's under equipment, take the time to move things for the inspector.

If it's in a closet, remove your personal possessions to leave it available. Same thing for exterior hatches - don't stack the firewood on top.

Some older homes will have the hatch nailed down. If this is the case, pry it up before the inspector gets there. The odds are that he or she won't take the chance of damaging flooring.

And if you're using screws to hold the covers in place - frequently done on exterior hatches to keep the board tight to the wall - use a standards screw head - no need to go with fancy star-patterned heads. We might not have that particular pattern or size on board the truck. Use a Phillips or square head screw.

The inspector will thank you, and the buyer will get the information they need without the extra worrying. And you move one step closer to a successful sale.

 

 

Keep Your Water Lines from Freezing!

Yesterday morning, I had the first hard frost of the season on my truck which means it's time again to talk about how to keep your water lines from freezing.

Hose Bibs

I have a comment that is embedded in my report that I use all winter:

In winter weather, it is a good idea to remove hoses from the bibs to prevent damage from freezing.

It is such a common item that we don't even notice it. The hose is still attached to the bib - more often than not, it seems, the hose bib is a frost-free. People like frost-free bibs for good reason - having a pipe freeze and break inside a wall is a major pain. The problem is that a frost-free valve doesn't work if the hose is attached and has water in it.

The frost-free valves work by having the actual shutoff inside the mechanism inside the wall, not at the handle on the outside of the home like the old 1950's style faucets. When you turn the valve off, the remaining water drains from the spigot so that it can't freeze. A hose prevents the draining. If the water is in the line and freezes, it expands and your pipe can rupture.

Make sure you remove any splitters or quick releases - these present the same problems. Also, make sure you don't have a slow leak as the water drips can freeze up the opening acting as a cap.

I recommend putting on covers to the hose bibs for a bit of extra protection. Will the inspector remove it - probably not, in my experience.

Many older homes that lack frost-free valves have shut-offs inside the house. If yours does, use it and then open the valve on the outside. I recommend covers on all non-frost-free valves.

Interior Plumbing

If you are living in the home while it is on the market, most of this is not going to be an issue for you but if you've already moved and the house is vacant but you want the water on, I want to remind you to do a couple of things that will keep the plumbing in safe conditions.

First, leave the heat on. It doesn't have to feel like the Bahamas inside, but you should keep the thermostat set to 55 degrees or higher. Leave all the cabinet doors open below the sinks to allow heat to get to the pipes. If you are not going to leave the heat on at all, you have to fully winterize the home. I will talk about winterization in another post next week . . .

Second, make a decision on whether you want to turn the water off to the home. If you turn it off, crack open the valves and drain the system as best you can. Leave a couple of the faucets open to allow the pressures to stabilize.

If you leave it on, ask your Realtor to check in on your property at least weekly. Some inspectors will also perform this service, so ask around. What you want from them is a visual inspection of the plumbing. In bitterly cold conditions, these visits should be done daily. It may cost a bit on money but I can promise you that the expense is less than that of spraying water and a flooded house.

In extreme conditions, the hot and cold water should be left on a trickle. As anyone who has paid attention to a river realizes, moving water is less likely to freeze.

Plumbing pipes at exterior walls, in unheated basements, and the crawlspace are most in danger. You may need additional heat or a heat tape in these locations. Any plumbing that is in unheated spaces should be insulated but, by the time you move out, it's probably too late unless you want to spend the extra money for your buyer. You should know that Washington State Standards of Practice mandate that we identify these in the report though we are required to recommend upgrading - for now, at least.

Don't forget the fixtures - and the water heater!

The toilet reservoir holds up to three gallons of water. Having that water turn into a block of ice - or worse, having the water heater freeze - can be disastrousHodges 017. The picture to the right is from an inspection I did two winters ago. The seller eventually spent thousands of dollars to make the necessary repairs.

If the heat is off, it is imperative that you, at a minimum, drain the toilets. If you turn the water heater off, drain it as well.

And, for what it is worth, the agent had recommended a full winterization. It was excellent advice and would have saved this seller a goodly chunk of cash.

It would have also kept the buyer from freaking out - and to be clear, this inspector is not a big fan of plumbing problems. They often end up more complex than first realized and always seem to involve a combination of multiple trips to the hardware store, bad language, and a good plumber.

A good agent is worth his or her weight in gold - please listen to them if they say you should winterize to keep your water lines from freezing. And follow the other steps above even if you are occupying the home. Especially those pesky hose bibs.

 

 

Calibrate the Radon Detector

To stay on the good side of the EPA guidelines, any person or organization must calibrate the radon detector - or if using a passive system, provide calibrate spikes to determine accuracy, at least annually to ensure the testing equipment is giving valid results. What this means at a practical level is that for three weeks of every year, my radon detector is not available. I use a pair of Sun Nuclear 1028 model monitors to provide testing in Moscow (an EPA Zone 1 area) and Pullman (an EPA Zone 2 area). To calibrate them, I have to contact Sun Nuclear, arrange for the service and return shipping (about $160 per unit), package it up on my end to send to Florida and then sit, twiddling my thumbs while they calibrate the radon detector.radon-1028

That's for one unit - I get to repeat this for the second unit as soon as the first gets back. I deliberately run a staggered cycle so I always have one unit ready to go.

Sun Nuclear also sends back a Radon Certificate of Calibration for each unit. If you want to read an example, here is the Radon Certification of Calibration for one of my units. Obviously, this one will be sent out shortly for fine-tuning as the cert is up on November 2nd.

One significant point is that there is no tracking of calibration done in either Washington or Idaho. This means that if you are a buyer or a seller (why sellers? see below!), you need to verify that the machines in use are properly calibrated so that you get accurate results. Ask to see the paperwork - don't take the inspector's word for it. As much as I want to believe every inspector is from Lake Wobegon and is above average, the reality is that there are some folks who refuse to follow this simple process.

For Sellers

It is crucial for you to verify the accuracy of the equipment used in your home. Should the results come back at a level that the EPA recommend remediation, you might lose the sale with the reputation of your home damaged  (worst case) or be on the hook for the cost of the remediation - $1,800-$3,000 in my area.

Ask to see the documentation as part of the radon report - my particular equipment gets the date reset by the testing lab when they calibrate the radon detector. This isn't true of all labs so ask, ask, ask for the paperwork.

Should the Seller Hire an Inspector? Part 3

This is Part 3 of Should the Seller Hire an Inspector? Feel free to offer comments and suggestions.

How to Pick your Inspector

One of the best compliments I ever received came from a client who had used me on a small commercial project.  The project was interesting - a turn-of-the-century storefront. He called me up later to inspect his home before he sold it.  His reasoning?  He wanted to take the best home inspector off the market forcing the buyers to select a lesser inspector.

I am going to presume that you, like most people, do not have a home inspector on speed dial.  If you decide that a pre-listing inspection makes sense for you, let’s look at the factors that you will need to evaluate in order to hire the right inspector.

Experience.  You need to have an inspector that has the professional background - education, time in the field, previous occupations - to be as thorough as possible. You should expect no less than five years of inspector experience in you region.  Previous experience in the building trades or as a code certified inspector is a plus.

Licensed.  Not every state has licensure but if yours does, your inspector must be licensed.  If things get contentious, the more qualified your inspector, the more likely you are to prevail.  Licensing is the entry level requirement.  Look for additional certifications from ASHI (American Society of Home Inspectors) or NAHI (National Association of Home Inspectors).  Ask to see copies of his professional license as well as any applicable business licenses.

Reports.  You need a detailed report preferably in a narrative format that will detail the specific condition that needs correction.  The inspector should be willing to do a follow-up inspection to document that repairs were made.  Expect to pay extra for this service.

Insured.  As I mentioned before, the inspector should be carrying E&O insurance as well as General Liability insurance.  Ask to see copies of his insurance binders.

 

You will note that I did not specify the fee.  While the fee is important to you, we are looking for a level of exceptional service.  A typical home inspection is going to cost somewhere between $300 and $500 depending on your region, the size of your home and the level of services involved.  Each region will have different pricing structures with some adding for building elements such as crawlspaces or charging extra for older homes.  Definitely ask but be aware that the low cost bidder is likely the one that lacks the other primary credentials that you need.

Another element to look for is a guarantee from the inspector.  When I do a pre-listing inspection, I offer the following promise:

I guarantee my inspection like this: if another inspector working for the buyer finds something that I missed that is included in my Standards of Practice, I’ll pay for the repairs up to the cost of your inspection.

Most inspectors are not going to voluntarily offer a guarantee so it’s up to you to ask.  The best inspectors will have some way of backing up their work.  Those are the ones that you want to work with.

Speaking of services, I will be covering environmental issues in Chapter 8 along with some of the specialty inspections that are offered in the marketplace.  I do not necessarily recommend that you do all of them but I want you to be aware of them so that you are not surprised if your buyer decides to access a higher level of information.

For now, you have enough information to have a candid conversation with your real estate agent.  Discuss with them the advantages and disadvantages of performing a pre-listing inspection on your home and make the decision from an informed basis.

This is the final installment of the article, Should the Seller Hire an Inspector? If you found it helpful, drop me a note. If you have suggestions, I would love to hear from you.

Should the Seller Hire an Inspector? Part 2

What’s the Downside to Hiring an Inspector?

This is Part 2 of Should the Seller Hire an Inspector? Feel free to offer comments and suggestions.

I just did a quick search of the internet looking for disadvantages for sellers who have used pre-listing inspections and discovered that, in the virtual world at least, there are no downsides to having a pre-listing inspection. I disagree.  The prevailing thought is that you are laying off the risks to the inspector who is carrying Errors and Omissions insurance as protection against lawsuits and judgments.  There are two problems with this perspective: first, that the assumption that the inspector is insured; and, second, that the aggrieved buyer will only name the inspector in any potential litigation.  The truth is that a third or more of the inspectors do not carry insurance.  It is not required in most states and is expensive to hold so many inspectors skip it.  The other issue, involving litigation, is that lawyers tend to name everyone they can in a suit - the inspector, your agent, you -even your dog if the lawyer thinks they have an monetary value.  So, what are the risks...?

The major risk is that the inspector finds a material defect that you were not previously aware of.   Once you know you have a material defect in the property, you will be required to disclose it.  This can substantially impact your sale price even if you repair the defect.  Obviously, if the buyers discover it, it will have the same negative effect.

There is a second risk as well.  Let’s assume that you hired an inspector, he did his inspection and gave you the report.  You look it over and are relieved - there’s not much to be fixed.  You do the light repairs and, when you get and offer, confidently invite the buyer to get his own inspection.  Then you get the inspection report back and the second inspector has found multiple problems with your “clean” home.  What just happened?

Probably one of two things and, unfortunately, only one you can directly control.  The first possibility, the one not fully under your control, is the inspector for the buyer feels he needs to create issues to justify a fee.  The second is that you hired the wrong inspector.  That you can control.

 

The final installment of this article, Should the Seller Hire an Inspector? will be posted on Monday, September 30, 2013

Should the Seller Hire an Inspector? Part 1

Should  the Seller Hire an Inspector?

That is a good question that unfortunately does not have an easy answer.  If you ask a home inspector, the answer is likely to be an unequivocal “Yes!”  If you ask your Realtor, the answer may be an equally emphatic “No!”

They are both right so let’s look at why.  More importantly, let’s find out which decision is right for you.

Reasons to Get an Inspection

There are three primary reasons that sellers consider getting an inspection.  First, to build a “to-do” list and get the home ready for market.  This type of inspection is usually very effective at identifying issues in the home that you can correct before you list it with an agent.  You won’t normally fix everything on the list but most people anticipate putting at least a modest amount of effort into the repairs.  This allows you to present the home to the buyer in better than average condition plus you have the chance to use the repairs that you have already completed as part of the negotiation process and limit the opportunity for the buyer’s inspector or agent from using over-inflated repair costs to drive the price down.  Also, the repairs that you make will likely make the home show better and encourage more and better offers while

Another advantage - if you hired the right inspector which we’ll discuss shortly - is the opportunity to pick the inspectors’ brain on what is really a necessary repair versus those items that are usually ignored.  Since he is working for you, he is able to provide advice regarding repairs, the costs that might be associated with them and the relative difficulty.   This in turns gives you the chance to prioritize the most important items that must be addressed, the small items that are quick fixes and the ones that you can disclose but not correct.  Remember that no home is perfect, so having some items left on the list is not unusual.

The second reason is to protect yourself legally from disclosure related types of issues.  Every state has its own disclosure forms and requirements that you, as the seller, need to fill out.  Mistakes on these forms can be terribly expensive if a buyer decides to take you to court.  By bringing in the inspector, you have an impartial third party who can provide you with information for your disclosures.  Mind you, not all of it because some of the information is historical - was there ever a flood? may be a question that the inspector can’t answer since the repairs were completed eight years ago and there are no visual clues..  Still, if you release the report as part of your disclosure, you give the appearance of a person who is honest in his presentation of the home and we are trying to build goodwill on the part of the buyer.  They are much more likely to trust a person who is making every effort to be honest.

The disclosure issue can’t be minimized.  It used to be very rare for me to get a call from new homeowners asking about failed inspections and seller disclosures.  The trend is accelerating and I now receive a call every couple of  months from home buyers that want to know if they should sue their inspector, the agent or the sellers.  Some areas of the country are more prone to litigious behavior - California, Florida, Arizona - but even in the deeply rural area that I live in, the change is noticeable.

The third reason that you’ll often hear for doing an inspection prior to listing is to try to discourage the buyer from having a home inspection.  Many inspectors advertise that a pre-listing inspection may encourage the buyer to forgo their own inspection.  While this does happen, I don’t suggest it and, even when I’ve done the inspection for the seller, I always recommend that the buyer have their own inspection done. Why?  Because you never want a perceived conflict of interest on your part or the inspectors.  Remember, we are trying to build trust throughout the process and limiting the choices of the buyer or even trying to influence them to self-limit can work to build doubt.  It is, however, a successful strategy and I estimate that half or more of the homes I pre-inspect do not get inspected by a buyers inspector.

Should the Seller Hire an Inspector, Part 2 will be posted Friday morning, early....

Smart Moves by Sellers, Pt. 2

Smart moves by sellers, part two....

The temperatures have dropped precipitously in the last week or so, down about 25 degrees and, if the trend continues, next week I won't be running air conditioners.

One seller is already in front of the curve. I showed up and the receipts for the air conditioner service and furnace service were sitting on the table. My client joked that the seller had made it easy for me since I didn't have to check them now.

He was wrong about that - I have to check anyway since it is part of the Standards of Practice for Washington State. And, occasionally, I'll find something that the service technician missed. Hard to believe, but they are human and subject to the same foibles as the rest of us.

But the comment struck me as really interesting. The proof of service was very reassuring to the buyer and helped her feel much more comfortable with the mechanical systems. When I tested them and looked for problems, I couldn't find any which just built on the sense of security that she had.

So, we're reaching the time of year where everybody tells you to service the furnace to get ready for winter. I'm going to borrow some smart moves by sellers and suggest that you should service it to help make your potential buyer more comfortable with the home, especially if the furnace is an older one. Proof of your good intentions combined with the assurance that a professional or two have signed off on the equipment can be a powerful inducement to action.

Smart moves by Sellers is an on-going series of articles that will hopefully help you make your home more salable. if you have specific questions you would like me to answer, please email me or leave a comment.

 

Floor Plans - A New Inspection Service

Within the next couple of weeks, I'll be adding a new service for my clients - floor plans, which I'm reasonably sure is a brand new inspection service since I can't find anybody else offering it. These floor plans will be generally accurate and will include placement of major items like the windows, doors and heat ducts. By generally accurate, I mean that the dimensions of the room will be close, probably within an inch or so but not precise to the degree that would be available from a construction blueprint. If major remodeling is the intent, the floor plans can give the client a staring point but it won't include the structural components or precision that will be necessary to remove walls, lift ceilings, or otherwise radically alter the home.

The idea is to provide clients, especially those from out-of-state, with a way of determining how they plan on living in the home - where the furniture can go, which rooms will be the best for the baby, which one can be an office.

I haven't yet figured out the cost factor for the service (I know, I know, that should be first but....) but, off the top of my head with a time estimate, I think it will be around $75.00.

For Realtors, it provides a means of differentiating your sellers' homes and can be included in the marketing plan.

Once I flesh the idea of floor plans out a bit more, I'll add to the services page.

Smart Moves by Sellers, Pt. 1

Smart Moves by Sellers

This will likely become on ongoing series...

The sellers at a recent inspection did two things to help set the tone of the inspection. First, they left the buyer and me a note offering us beverages- though not the wine. But water, soft drinks and juices (cooled in the outside refrigerator) were available. On a hot summer day, it was a welcome gesture.

The second was to leave another note, this one at a piece of missing trim above the bedroom door. On the note, is said simply "We will fix this." Want to talk about building trust as a seller. These folks did great.

So, two Smart Moves by Sellers to first welcome and then reassure the prospective buyers. It cost them a minute and two pieces of paper.