The dawn of a new age in residential sales transactions
The new Residential Purchase Agreement (RPA) is changing this year. The reference to the Wood Destroying Organisms or termite inspection is being left out of the agreement. The responsibility of ordering the termite inspection is being placed on the buyer rather than the seller. The cost of the termite inspection will become the buyer’s responsibility. The repair cost will be negotiated like all other repairs. Buyers are going to have to perform all of their inspections quick and gather their data. Based on the data, they need to construct a viable reason that they should be given a credit for property imperfections. Unfortunately, these imperfections could not be discovered until a thorough inspection could be performed.
I do not expect that anyone will complete a transaction without getting a termite inspection. Closing a transaction without a termite inspection would create potential liability for the agent. There might be less work ordered and more credits extended, but that would not be the end of the world. If the termite company is good at what they do, the buyer is going to use them in the future. A broker would not be doing their job by not advising their clients to get a quality termite inspection. Market conditions presently create a free termite inspection environment and termite companies are consistently working on lowering prices rather than designing quality services.
As the owner of a termite company that specializes in reports for escrow, I am excited about these changes. The seller choosing the termite company and ordering repairs has always been problematic, most sellers are unilateral in their thinking, how much is it going to cost and can it be done cheaper. Nothing is wrong with this thinking, it is entirely expected from a seller, however a home buyer will have a different mindset.
In a buyer-driven market, things are going to be different, termite companies are going to have to be competent, they are going to have to provide a timely service, they are going to have to create a professional presence, longevity and reputation will matter and complimenting services will be important. This will create an environment that is ever improving, quality driven and where professionalism is appreciated and demanded. I think this change will be good for everyone, it might take a little getting used to but the outcome will create a better transaction for both buyers and sellers.