Dishonest, fly-by-night, or even simply inexperienced renovators can leave a trail of heartbreak. Buyers move into their newly purchased home and problems show up later. Here are three recent scenarios:
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First client: One year after closing, flooding in the basement. Removal of the drywall shows badly repaired horizontal cracks, most likely a do-it-yourself job. The new wiring was improperly installed. Studs on 24-inch centres instead of 16-inch centres. Likely the whole basement needs to be ripped out and done over. Two repair estimates at $90,000 and $100,000.
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Second client: After moving in, sinks aren't draining properly and there is occasional odour of sewer gas. Three different plumbers can't locate the problem. Finally, drywall is removed, and the new piping and venting has not been done according to code, numerous mistakes. To replace piping, drywall, painting, and some new carpet will cost $20,000-$25,000.
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Third client: Buyer notices dampness in one corner of the basement. It turns out the sump pump is leaking. Further inspection shows that the new sump pump is undersized, improperly installed and in the wrong location. Our buyer is still getting estimates for repairs.
These are all previously owned homes where the seller supplied a current RPR and compliance, no issues shown.
The common thread is that each property had a nicely done, completely renovated basement. No secondary suites, but family rooms, bedrooms, bathrooms, and storage. Our first two examples had a satisfactory property inspection. The third one didn't. After the problems revealed themselves post closing and on further investigation, none of the properties had permits. And, of course, no permits means no final approved inspection by the City.
So, if a home inspection doesn't reveal problems, and maybe it should have in the third scenario, what should buyers and buyers’ realtors do?
My conclusion is, if you see or know about a finished basement, especially a recently finished basement, a potential way to protect your clients is to start the conversation about permits. Ask for copies of permits and final inspections. Show these to the home inspector before he does his inspection. Copies of permits or not, tell the home inspector to carefully consider what he can say about the state of the finished basement. Sometimes inspectors can't really say anything because they can't see anything.
If the seller doesn't have permits or doesn’t know if permits have been obtained, then, perhaps, force the issue. Seriously consider whether to advise your buyer clients to insert a term or condition in the offer to purchase.
