While it’s not illegal for brokers to charge a fee, home inspectors can be fined and have their licenses suspended if caught. But the practice is commonplace, nonetheless.

“Concierge services within the industry are a revenue stream,” said one local broker who spoke to LIBN on the condition of anonymity.

To circumvent the rules, home inspectors often compensate brokers for inclusion on their referral list by paying for home-buying seminars, luncheons and other events used to drum up customers, he said.
Most of Long Island’s major residential real estate companies have some kind of referral system for outside services. Prudential Douglas Elliman, Century 21 and Daniel Gale Sotheby’s International all provide customers with lists of vendors, including home inspection firms.

Marie Montchal, senior vice president for relocation and ancillary services for Daniel Gale Sotheby’s, said vendors pay “a small fee” to participate in her company’s “home services” program, where they’re put on a preferred list – on the Web and in print – and get a booth at Daniel Gale’s annual vendor fair.

Conversely, Coldwell Banker expressly warns its brokers that vendors on its list are there free of charge and that home buyers should request letters of reference.

Concerned with the potential for fraud and looking to raise the standards for inspectors, a trade group called the New York State Association of Home Inspectors met with officials from the Department of State in Albany last month to voice their concerns about unethical and unqualified inspectors getting licenses to practice here. The group said their profession is being compromised by an inadequate licensing process that doesn’t hold new inspectors to a high enough standard.

“Were trying to raise the bar,” said Peter Wilson of Wilson Inspection Agency in East Patchogue, a member of the association’s legislative committee.

Home inspectors weren’t licensed in New York before 2006, when just about anyone with a flashlight could hang out a shingle and conduct home inspections. But longtime inspectors complain that the 140-hour course for a license should be lengthened to 180 hours, adding 40 hours of field work. They are also pushing the state for an increase in the 24 hours of continuing education required every two years to keep the license.

By comparison, the state requires hairstylists to undergo 300 hours of training; 2,000 hours are required for real estate appraisers.

Dov Herman, of NY Inspect in Woodmere, said the state’s standard for home inspection licenses is so low that New Jersey doesn’t allow licensed inspectors from New York to perform inspections there.

New Jersey requires 100 classroom hours and 80 hours in the field before issuing a home inspection license. It also requires 40 hours of continuing education every two years, nearly double the New York regulations. In addition, home inspectors in New Jersey must carry insurance for errors and omissions, which is not mandated in New York.

Veteran inspectors say raising the standards for licenses would cut down on fly-by-night home inspectors just out for a quick payday.

Wilson said a home inspection should take about 2 1/2 hours, and the inspector shouldn’t be beholden to the real estate broker, attorney or anyone else with an interest in seeing the sale go through. He said licenses are too easy to get, giving established inspectors more competition at a time when are also fewer home sales.

After presenting their case for stricter licensing, Wilson said officials at the Department of State told his group they would consider strengthening its home inspection licensing requirements. He said the chief DOS investigator asked the home inspection group to spread the word that the agency is on the hunt for inspectors who might be breaking the law.

“If NYSAHI or anyone else knows of specific instances of this practice we would urge that a complaint be filed with the department,” said DOS spokesman Chris Valens in an email.

Though home sales are down since 2007, home inspection licenses in Nassau and Suffolk counties are up 33 percent in that same time, according to the Department of State.

“You’ve got a guy who just got his license last week, and he’s inspecting a million-dollar home,” said John Zito of Atlantic Home Inspection. “It’s like giving a brain surgeon a hammer and chisel and having him do surgery.”

Complete URL: http://libn.com/2012/03/30/new-york-investigating-real-estate-pay-to-play/

David Winzelberg
Reporter
Long Island Business News
631.913.4247
917.796.1801
david.winzelberg@libn.com
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Learn about home inspection services in New York and consumer protection advice on selecting a professional home inspection company.
________________________________________
Unfortunately, the home inspection industry has a mixed reputation … good and bad. It is far too easy to start up a home inspection business by people who do not have the training or motivation to provide a safe and effective service.
________________________________________
“Happy Haphazard” inspection… done dirt cheap

Unrealistic price cutting and resultant inadequate servicing regularly occurs with some companies operating from a rented website or website template using a temporary or cellphone number. Here today – gone tomorrow.
________________________________________
Such low pricing can be compromised by providing a sub-standard service using recent inspection school graduates and the cheaper old style inspection tools and reports – a danger to themselves and the general public.
________________________________________
The modern technology tools are far more effective but much more expensive and require a higher level of skill to ensure an effective result.
________________________________________
After a thorough inspection and detailed written report on the premises, your home inspection professional should recommend a range of methods suited to your particular circumstances, with an emphasis on safety and effective protection of the premises.
________________________________________
PLEASE NOTE: homeowners insurance does NOT protect you from neglectful or improper home inspectors.
________________________________________
The most common consumer complaint is that the Company has NOT done the job properly “the inspector missed major damage” and the Company has disappeared, leaving the home-owner with the problem.

Consumer Advice on Selecting a Home Inspector

Selecting a professional home inspector that will provide an appropriate “value for money” professional and thorough service can be a daunting task. Your inquiries should focus on whether the business is a solid company, the level of expertise , the technology used, the number of years performing home inspection and if they are part time or full time inspectors
________________________________________
Obtain several quotes and check out each of the companies. First inquire as to how long the business has been established. Do they have a good reputation in the market-place. Are they a member of a recognized Home Inspection Association?
________________________________________
Ask questions about their use of technology and the reporting system the company employs. Compare notes on the methods of each company. Which company seems the more professional?
________________________________________
Make sure the company carries professional indemnity and public liability insurance for their home inspection services and inspection reports.
________________________________________
Be present during the home inspection. Study the general presentation of the inspector, such as, was the inspector in jeans or professionally dressed, with proper equipment? Did he/she arrive in a tidy motor vehicle and use quality equipment, including an infrared camera **** ? Was a thorough inspection carried out? Were you presented with informative documentation regarding the inspection findings? Did he/she adequately explain the issues so you are confident he/she knew his/her subject matter? Were there any other aspects that may indicate professionalism or otherwise? Make notes and comparisons.
________________________________________
Inquire as to the qualifications and experience of the home inspector. Does he/she have a home inspection license for over 5 years (and not just a recent graduate). You should research his/her State Government issued home inspector license . ________________________________________
Inquire as to whether the company uses employees or sub-contractors. Be wary of companies with multiple inspectors or sub-contractors as problems often occur in the market place where sub-contractors or newbie inspectors are used ________________________________________
Be wary of companies that offer a $500.00 or 200% warranty as this is usually unrealistic and a sign of jumping through hoops to claim and indicates short-term intentions.

Learn about home inspection services in New York and consumer protection advice on selecting a professional home inspection company.
________________________________________
Unfortunately, the home inspection industry has a mixed reputation … good and bad. It is far too easy to start up a home inspection business by people who do not have the training or motivation to provide a safe and effective service.
________________________________________
“Happy Haphazard” inspection… done dirt cheap

Unrealistic price cutting and resultant inadequate servicing regularly occurs with some companies operating from a rented website or website template using a temporary or cellphone number. Here today – gone tomorrow.
________________________________________
Such low pricing can be compromised by providing a sub-standard service using recent inspection school graduates and the cheaper old style inspection tools and reports – a danger to themselves and the general public.
________________________________________
The modern technology tools are far more effective but much more expensive and require a higher level of skill to ensure an effective result.
________________________________________
After a thorough inspection and detailed written report on the premises, your home inspection professional should recommend a range of methods suited to your particular circumstances, with an emphasis on safety and effective protection of the premises.
________________________________________
PLEASE NOTE: homeowners insurance does NOT protect you from neglectful or improper home inspectors.
________________________________________
The most common consumer complaint is that the Company has NOT done the job properly “the inspector missed major damage” and the Company has disappeared, leaving the home-owner with the problem.

Consumer Advice on Selecting a Home Inspector

Selecting a professional home inspector that will provide an appropriate “value for money” professional and thorough service can be a daunting task. Your inquiries should focus on whether the business is a solid company, the level of expertise , the technology used, the number of years performing home inspection and if they are part time or full time inspectors
________________________________________
Obtain several quotes and check out each of the companies. First inquire as to how long the business has been established. Do they have a good reputation in the market-place. Are they a member of a recognized Home Inspection Association?
________________________________________
Ask questions about their use of technology and the reporting system the company employs. Compare notes on the methods of each company. Which company seems the more professional?
________________________________________
Make sure the company carries professional indemnity and public liability insurance for their home inspection services and inspection reports.
________________________________________
Be present during the home inspection. Study the general presentation of the inspector, such as, was the inspector in jeans or professionally dressed, with proper equipment? Did he/she arrive in a tidy motor vehicle and use quality equipment, including an infrared camera **** ? Was a thorough inspection carried out? Were you presented with informative documentation regarding the inspection findings? Did he/she adequately explain the issues so you are confident he/she knew his/her subject matter? Were there any other aspects that may indicate professionalism or otherwise? Make notes and comparisons.
________________________________________
Inquire as to the qualifications and experience of the home inspector. Does he/she have a home inspection license for over 5 years (and not just a recent graduate). You should research his/her State Government issued home inspector license . ________________________________________
Inquire as to whether the company uses employees or sub-contractors. Be wary of companies with multiple inspectors or sub-contractors as problems often occur in the market place where sub-contractors or newbie inspectors are used ________________________________________
Be wary of companies that offer a $500.00 or 200% warranty as this is usually unrealistic and a sign of jumping through hoops to claim and indicates short-term intentions.