Real Estate's Dirty Little Secret

NC5 Investigates: Consumer Alert

Real Estate's 'Dirty Little Secret' Revealed

Posted: Feb 19, 2014 7:22 PM PST

by Jennifer Kraus
Consumer Investigator

NASHVILLE, Tenn. -- Before you buy a house, it's pretty standard to get it checked out first by a home inspector -- someone who will tell you if there are any major problems with the house.

But NewsChannel 5 Investigates has found you may not be getting the whole story from your home inspector.

Most homebuyers have no idea this is going on, but both real estate agents and home inspectors say it definitely happens.

It's real estate's dirty little secret.

East Nashville homeowner Allison Wadley recalled her first impression of her house, "It just had that homey feel."

And Wadley said she thought it was a great house with no major problems and that a home inspector told her pretty much the same thing right before she bought it last fall.

NewsChannel 5 Investigates asked Wadley, "So based on what he said, you decided to buy the house?"

She replied, "Sure."

But just a week or so after moving in, Wadley said, she began discovering problems the inspector never mentioned, like collapsed ductwork in the basement that had totally separated from the system.

"It was right there in front of your face," Wadley described.

So why didn't the inspector say anything about it?

Veteran home inspector Bruce McClure thinks he knows.

"I'm saying what most inspectors are afraid to say," McClure told NewsChannel 5 Investigates

McClure has been a registered home inspector for 16 years and taught home inspection courses for more than a decade. Now he says he's trying to expose what he says those in the industry don't want you to know - that some inspectors will fail to mention major problems to homebuyers.

"Because realtors don't want you to find the problems?" NewsChannel 5 Investigates asked.

"Yes, because it blows their sale. And we become known as the deal killers," McClure explained.

He went on to say, "The reward for turning a blind eye is future referrals from the realtor."

That's why McClure said that some inspectors will keep their mouth shut or at least downplay serious issues that could jeopardize the sale. He added that some real estate agents are obviously in on this too, although not all of them.

"But there's a darn good number of them that they're more concerned about steering the client towards a home inspector that's going to turn a blind eye to issues, run through the house, not do a thorough inspection and basically protect their sale," McClure stated.

Sound farfetched? Maybe.

But NewsChannel 5 Investigates found many complaints filed with the state's home inspector licensing program in the last year by homeowners who said their home inspector failed to mention major problems that should have been spotted and noted during their inspection.

Allison Wadley had to spend $3,000 to replace her ductwork right after moving in.

"Nobody wants to fork out money like that when it could have been at least noted on an inspection report," she said.

Wadley admitted though that she, like most people, simply hired the home inspector recommended by her realtor.

Bruce McClure recommends doing more.

"You've got to do some shopping to find your home inspector," he said. 

He said that a home inspector needs to know about plumbing, electrical work, framework, systems, and safety concerns.

McClure recommended finding one who is certified by a national trade group like the American Society of Home Inspectors, which requires significantly more training, testing, and hands on experience than is required by the state to get a license. 

He also strongly suggested going along and following the inspector during the inspection. You'll easily learn more about the house you're buying, he says, and there's a better chance you'll see any potential problems.

"Any inspector that doesn't allow you to attend the inspection with him, that should be a red flag, McClure cautioned.

Allison Wadley recently found even more problems in her basement in the crawl space.

The home inspection report simply said that "some of the floor joists have been repaired" and that they were in "satisfactory" condition.

But what Wadley said she discovered was a jerry-rigged mess, falling apart, and likely, Wadley fears, another big expense.

"He mentioned every little crack or this or that elsewhere. But two major things that can amount to a lot of money were missed," Wadley recalled of her home inspector.

Wadley wishes now that she known about these things before buying the house.

"Had you known then what you know now about the house, would you be living here today?" we asked.

"Probably not," she answered.

Now again, we're not saying all home inspectors or all real estate agents do this sort of thing. But, it's something to keep in mind when you're buying a house.

Remember, you do have the final say in who you use to do your home inspection.

So other than using who your realtor suggests, how else do you find a home inspector?

Ask people you know who have recently bought a house for recommendations. They should have lived in it at least six months so they've had time to discover any problems that might not have come up during the home inspection.

And before you hire anyone, be sure to check them out. Make sure they're licensed with the state. And again look for someone who is certified or is considered a master inspector by one of the home inspection trade associations which means they've had additional training and had more experience.