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Why U&O Inspections are Pointless

Lisa Loper of the Scott Loper Team discusses the inconsistencies of point of sale inspections throughout our area.

A point of sale inspection is one that is done when a property is sold.  For the resale of residential property, these are called Use and Occupancy (U&O) inspections and are required by some (but not all) municipalities.

Often times, the municipality is looking to see if the there are working smoke detectors, handrails, and GFCI protected outlets.  Other municipalities may be checking the condition of the sidewalks or to ensure storm water is not making it into the public sewer system.  There are some municipalities that treat the U&O inspection almost like a home inspection looking to flag anything they would like to see corrected.

The problem with these inspections is that in any given area, only a small number of homes (1-2%) sell per year.  So if the municipality is worried about the cost of treating storm water in the public sewer system, it will take over 60 years for the majority of homes to be sold (and therefore checked for this problem).

If the problem is significant, the solution should be timely and not wait until homes are being sold to solve it.  Having one person fix their sidewalks or ensuring one person doesn’t have a leaking sewer pipe, does nothing to solve the overall problem of trip hazards in a community or excess discharges to the sewer authority.

Significant problems should be addressed at once and throughout an entire community to ensure valid resolution and take advantage of economies of scale.  And if the problem isn’t significant, then leave the seller and buyer to address any problems within a particular house.  That is why disclosure laws exist, buyers have home inspections, and mortgage and insurance companies have their own requirements for a home being to certain standards. 

Point of sale inspections can needlessly hamper the sale of homes and cost sellers a few hundred to thousands of dollars.  Then the following year when municipalities change their U&O requirements, it only further undermines the value of these inspections.

The Scott Loper Team includes Scott & Lisa Loper, Keller Williams Real Estate, 601 Bethlehem Pike, Bldg B, Ste 100, Montgomeryville, PA 18936, (215) 631-1900.

Stephen Eickhoff September 12, 2012 at 07:44 PM
Agreed. The problem is that the alternative is for local governments requires planning and consideration for the property rights of the homeowners. Doing the inspections at the point of sale provides them a ready "excuse" to overstep their bounds. The seller is leaving or has already moved out, and the buyer hasn't yet taken possession, so complaints aren't taken seriously.
Anti-statist September 13, 2012 at 01:12 PM
Heartily agreed. Issues that affect the public should be done on an ongoing basis, ie sidewalks etc. It is between my insurer an I what improvements need to made that affect safety and liability. It is government over reach to dictate otherwise. It is none of there business what toilets I use, if I install sprinklers, fire alarms, ground fault interrupted revives, arc fault interrupter circuits, fire extinguishers, what light bulbs I use, etc. My home is PRIVATE property. It is not a public accommodation. Furthermore, is none of there business what I eat, drink, smoke, do with my free time. It is time that public officials realise that they work for us. They are not our rulers.
henry eroh September 13, 2012 at 01:24 PM
this is all about money- sure there should e inspections to see that all is safe- but the inspector's mostly think they are big bosses- It is important to keep things safe but how many people keep up with fire detector's as they should! things will never change the homeowner's always foot the bill no matter what- and I agree if we pay our taxes it is none of there business what goes on in our homes as long as it does not affect dangereously our neighbor's- You do not need to let them or anyone else in your home unless of course you are a criminal doing just that
Peter Wieck September 13, 2012 at 05:14 PM
YIKES! What blather! The problem is this: If I have the storm-water system connected to the sanitary system in my house - against code and regulation - I am, in effect, stealing from every one of my neighbors who pays sewer fees. It is just that stark and just that simple. If I have a leaking water service which I am concealing, same thing. If I have serious electrical problems that could be a fire hazard, I am putting my neighbors at risk - either a burnt house on the block affecting property values, or even potential damage to their houses from a fire. Bad sidewalks are a trip hazard. And so on and so forth. Now, chances are if I am deliberately concealing such defects from the township or municipality, I am very likely concealing them from the buyer as well. And that, apart from the clear ethical issues - is simple fraud. Keep in mind that this is a Point-of-sale inspection - and presumably only to determine specific and actual problems - which should be already known and understood. It is NOT an invasion of privacy, even a little bit. I have to be suspicious of those who react as they do as if their underwear drawer was being scrutinized.... What do they fear that should bring on such vehemence?
Peter September 14, 2012 at 01:29 AM
Before everyone gets all bent out of shape over this let's remember, the writer is involved in selling real estate and the line "Point of sale inspections can needlessly hamper the sale of homes and cost sellers a few hundred to thousands of dollars," clearly shows her real agenda. I seriously doubt Ms. Loper cares about the overall safety of her neighbor's houses or would support a community-wide door-to-door inspection of all properties, she simply doesn't want anything to reduce the chance of her making a sale.
Golden Cockroach September 14, 2012 at 12:51 PM
WHY U & O INSPECTIONS ARE POINTLESS? U&O's are important. But why are they done on the back end of a sale? Wouldn't it make more sense to have them done before the house can even be listed? What a great selling feature for real estate people, "the U&O is complete and the house passed with flying colors," - or - "the current owner has taken great care to meet the U&O requirements...all you need to do is move in!" When it comes to 'Rental Inspections" in Pottstown the question really is......WHAT'S THE POINT? IMHO the most critical part of an inspection would include the heating system and electrical wiring. Given the appearance of the vast majority of rentals in the downtown neighborhoods, is it wise to anticipate that the major systems are in safe, functional condition? Yet, via conversations with several inspectors, I understand that they are not required to inspect them. http://goldencockroach.wordpress.com/open-house-you-are-invited-to-see-the-living-conditions-inside-a-slum-rental/
henry eroh September 14, 2012 at 01:05 PM
oh by looking at some of the homes in pottstown I am sure they are all up to code- you have to be kidding- some look like they are not decent for rats to live in them- it is a shame bit I know economy is harsh but has been for yrs- alot of these home are welfare occupied and don't give a crap about them but that they get free rent and everything else from us taxpayer's
Golden Cockroach September 14, 2012 at 02:50 PM
Right Henry. The occupants are also getting sick from mold, raw sewage, cockroach & rodent infestations - medical services are also courtesy of the taxpayers. But, if their luck holds out, while rental investors are playing russian roulette with the heating and electrical systems, they won't experience sudden death by carbon monoxide poisoning or fire. What really surprises me is why an insurance company would even touch housing that is on the verge of imploding and why they don't do their own inspections at regular intervals. Sometimes I think these rental investors are just hoping a structure will implode so they can collect and move on to the next property. I assure you that the only winners in Pottstown are the investors.
Alicia Landis September 14, 2012 at 04:18 PM
In general, I think realtors are good people and I don't think that Ms. Loper has a hidden agenda.
Lisa Loper September 14, 2012 at 06:03 PM
Some of the comments imply that real estate agents are self-serving, sellers are liars, and buyers are stupid and need the local government to uncover the dark truths about the house they are about to buy. Talk about blather. • Most real estate agents are good people who care about the communities in which they work, live and raise a family. And they certainly care about their clients - buyers and sellers. • Most sellers are not intentionally discharging storm water to the public sewer and then trying to deceive potential buyers about it. Most sellers are quick to agree to address real issues and make great efforts to turn over good houses to buyers. • Most buyers are actually quite intelligent and capable of bringing in good inspectors to find and resolve the material defects in the home. I know there are real issues especially in boroughs such as Norristown and Pottstown with rental units being in terrible states of disrepair. So again, why wait until they are being sold to address the problem? Those problems are real and need timely resolutions. FYI – Only about 50% of the municipalities in this area perform U&O inspections on residential re-sales. And of the ones that do, very few look at potential fire hazards such as heating and electrical systems. If they did and there was a subsequent fire, the municipality that “blessed” the house would get sued.
Golden Cockroach September 14, 2012 at 07:56 PM
THANKS for the clarification Lisa. I hope I didn't sound like I was dissing real estate agents, I LOVED working with the agent that sold us our home and she did a fantastic job. You got me to thinking back to the U & O on our house and you are right, they didn't inspect our furnace or the electrical. And again, you are right, sellers and buyers work the issues out to the satisfaction and safety of the new owners. You have to presume that the house is being listed because the owners want to sell - so it behooves everyone to do the best possible. So, in other words, these inspections are nothing more than revenue generating machines for municipalities? Interesting: "FYI – Only about 50% of the municipalities in this area perform U&O inspections on residential re-sales. And of the ones that do, very few look at potential fire hazards such as heating and electrical systems. If they did and there was a subsequent fire, the municipality that “blessed” the house would get sued." So therein lies the rub, they don't want to get sued for faulty inspections. Boy do the investors have renters in P.town by the horns!!! It seems like it would be worth the cost and effort for a tenant to get their own independent inspection because there are really is very little information or protection regarding the most major possible issues.
Golden Cockroach September 14, 2012 at 08:34 PM
...on second thought, the Borough should require the landlord to have a certified, independent inspection and service, (if necessary), of the major systems in their rental properties. I would also expect the insurance companies to require inspections on some regular basis. Because, again, the people with the most to lose are the renters who are also the most vulnerable to unscrupulous landlords and municipalities - whose first concern is covering their own boodies. A distant second - the health and well being of its citizenry.
linda spreeman September 14, 2012 at 11:58 PM
A good home inspector will uncover all of this and more. Why pay for both? More government red tape. ~Linda Spreeman, King of Prussia~
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