Holding The Line On Price

Reading the news has become a somewhat depressing event - almost as bad as grocery shopping and getting gas. Yep, even without the headlines, I could see inflation surging on the stuff I buy.

Most businesses are responding by doing the logical thing - they are raising prices. Again, I understand. My E&O insurance went up, my credit card fees have gone through the roof, gas prices are up everywhere, and all the little incidentals have nudged higher. Profits? . . .

Depressing. (pun intended.)

To all of you buying houses today, the prices are up and interest rates are headed that way. Likewise, my competitor’s prices increasing.

Mine aren’t, not now, not until July at the earliest.

I have traditionally been the highest priced - and the best! - inspector in the region for home inspections based on my surveys. Now, competitors are raising their prices and I’m somewhere in the middle.

I’ve never been inclined to try to take advantage of my customers. I discovered in the first year of the home inspector business that I wasn’t particularly money-motivated.

I’m a craftsman - I want the best possible inspection for my customers. This often puts me at loggerheads with Realtors. Too bad for them (though a group of them in Moscow have now started blacklisting me. I’ve got the documents to prove it.)

So, the prices on my website today will be the same ones in place on June 30th.

So, to the home buyers - the best of luck to you. I hope that you will find your dream home and I hope that I can be your inspector so you know exactly what you’ve purchased.

The High Cost of a Cheap Inspection

I have to admit that this year has been interesting - and FRUSTRATING.

This is a year that has included my usual residential work with some neat people. I’ve also worked with some folks that were less than neat and forced me to change procedures, including one gentleman who stood on a rickety second story deck railing to see what I was doing on the roof. I took a picture and sent it to his agent with the message, “THIS is way inspectors have anxiety attacks!”

I also had a client go through the dresser of the property owner. I was mortified.

Throw in a couple of other incidents, and I had to make a policy change. While in the past, I always wanted the client to attend the whole inspection, now I encourage clients to visit with me at the end of the inspection. This actually means the inspection process takes longer, but I simply will not have a client get injured on one of my projects, and I’m not going to violate a homeowner’s privacy. To compensate, I now put a lot of video into my reports.

I also am working as an expert witness in a case for a law firm in Spokane. I won’t go into particulars, but the process has been fascinating and will lead to changes in my reporting (even more thorough!) and policies.

I’ve had multiple clients set inspections and then cancel them after they were told that the listing agent would not allow me to inspect the property. In one case, the client was an attorney. From a real estate agent perspective, this was just dumb as it opens them up to a suit. As an inspector, it is frustrating - especially in the case of a home where I had previously called out structural concerns. As the”deal-killer” inspector, I’ve gotten used to being blacklisted but nothing says I have to like it.

But Wait . . . . There’s More! Let’s Talk Commercial Inspections

The most frustrating part of the year happened on the commercial real estate side.

Last year (2018) was a banner year for commercial inspections and I did some outstanding work identifying issues ranging from deteriorated foundations on a historical building to sagging walls in a warehouse building, to the extreme difficulty of upgrading a boiler system in a 1950’s building.

Good stuff, great catches, and I saved my clients a lot of money. This is not the way to endear oneself to the local agents. At the heart of the ASTM E2108 Property Condition Assessment (the recognized commercial inspection standard) is the Opinion of Probable Costs. When identifying deficiencies, I also generate an estimate of the repair costs. As you might imagine, this estimating requires considerable time and expertise. Contacts in the construction world help a lot, too.

One that didn’t get away . . . A landmark Pullman Building and Restaurant

This year, I missed on multiple projects. The reason?

I was too expensive. In almost every case where this happens, I am discussing fees and proposals with the agents and not the principals. Not an ideal arrangement.

One project that I missed out on was the McConnell Building in downtown Moscow. It is a historic building constructed in 1890. I will be the first to admit that I’m a sucker for old homes and buildings. I’m also leery of them and approach them looking for surprises. Sometimes it’s wiring issues, sometimes it’s foundation concerns - the list goes on and on. The inspector needs to be highly competent and vigilant.

In the case of the McConnell Building, it was the plumbing and I suspect that it was not discovered in the inspection process. After testing, the management company discovered that there was lead in the drinking water. This is a very big deal - and very expensive to fix. It is also exactly the type of issue that the inspector should be looking for when performing the walk-through survey.

This was not the only surprise. The new owner, Andrew Crapuchettes , with whom I have not talked, hinted at additional difficulties. Per this article in the Moscow-Pullman Daily News, there were several other “significant deferred maintenance issues” that he now has to deal with.

Yes, this chimney needs more than a little help.

One I’m not sure the current owner probably doesn’t know about yet is something I learned at the fire department while marketing my new chimney inspection service. Apparently, a neighboring business didn’t want to have the McConnell residents climbing on the roof of his business, so he nailed the windows shut from the outside. I have no idea if that condition still exists or if it is legal, but it just adds to my conviction that a proper commercial inspection includes all aspects of due diligence, including gathering the building permit records, health department records, and fire safety inspection reports.

As an inspector, that bugs me. My job - any inspector’s job - is to get that information and protect my client. The purpose of the Opinion of Probable Cost section is to address exactly this issue and is a critical feature of the due diligence process.

I’ll never stop saying it - you need the best inspector you can afford. The guys that work on the cheap will likely deliver a product that reflects their attitude toward their profession.

Drone Inspections

After a bit of hard work, I have passed the FAA test to be a Part 107 Remote Pilot. This means that I can legally use drones in the real estate industry. While much of the work will certainly be geared to real estate photography here on the Palouse, the drone that I fly - the DJI Mavic 2 Pro - is a top-of-the-line piece of equipment that can inspect anything from inaccessible roofs to cell towers.

The Mavic is a dream to fly (hat tip to Jess Rainer at Windermene in Pullman for the great advice on drones!) The integrated software and hardware make it possible to take terrific photos and video right out of the box.

Early returns are very encouraging and I’ve already started booking work for the drone. In fact, the first job paid off the insurance for the equipment.

Yes, I carry insurance on the drone and on the drone operation. While there is no legal requirement, it is the prudent option.

I’ll be adding pictures from iconic spots around the Palouse and from the Lewis-Clark Valley every once in a while. I’ll also be building out a separate website for the drone business. While I intend to use the Mavic for inspections, it will be through a separate company.

I’ll keep you posted.

It's Swarming Season

It’s an unwelcome sign that spring is here, but swarming season has begun. If you spot these winged reproductives, call you local Pest Control Operator.

In Idaho, I call them carpenter ants. In Washington, due to regulations, they are ‘suspected wood destroying organisms.’

In either case, they’re trouble.