Episode Transcript
[00:00:00] Speaker A: Welcome back to the real estate and more show. I'm your host, Michael Hatfield. This segment is entirely about real estate. Our special guest this morning is no other than the senior vice president and general manager of Home Guard Inc. Mister Curtis Reese. Homeguard Inc. Is one of the largest home inspection companies in northern California, the Central Valley and Southern California. As a realtor, I've worked with Mister Reese for more than a decade and can say he and his company have been incredibly helpful with client inspections for knowledge on home, termite, roof, pool and sewer lateral inspections. Mister Reese is here today to share his knowledge and his experience with us. We're going to unpack of mysteries surrounding those inspection reports and why they're needed, who orders them when they should be ordered and who pays for them, buyer or seller? Welcome to the show, Mister Rees.
[00:00:56] Speaker B: Good morning, Michael. Thank you for having me.
[00:00:58] Speaker A: Oh, it's good to see. It's good to see a little bit different venue than what we normally work in. But it's all good, isn't it?
[00:01:03] Speaker B: Yeah, absolutely.
[00:01:04] Speaker A: Yeah. Well, can you tell us a little bit about yourself, your background and then launch into what you do now?
[00:01:10] Speaker B: Well, I've been in this industry for, boy, going on almost 40 years.
Started out doing repairs, decided I didn't want to be doing that the rest of my life. Ended up getting my termite license to do termite inspections. And a couple years into that, realized I didn't want to be crawling their houses the rest of my life. So I moved up into a management position and been with home guard for 35 years.
[00:01:37] Speaker A: Oh, my gosh. 35.
[00:01:39] Speaker B: Wow.
[00:01:39] Speaker A: Wow. So you're in charge of many inspectors?
[00:01:42] Speaker B: The inspectors office staff. Basically I'm a babysit all the employees.
[00:01:49] Speaker A: So the buck stops with you? Pretty much.
[00:01:51] Speaker B: For the most part I have people answer to, but yes.
[00:01:54] Speaker A: Yeah, I understand. So in a home buy, it's incredibly important to have the confidence in the condition of a home. You want to know how, how well that home has been constructed, if there's deterioration, any issues with that before you put down your hard earned money to move forward and to complete the deal and own the property. And I guess in reality, we give that to that responsibility to your inspectors when we hire them. Is that not kind of the gist of it?
[00:02:22] Speaker B: Yes, that's pretty accurate.
[00:02:24] Speaker A: Okay. And what type of inspections does your firm do?
[00:02:28] Speaker B: We do termite inspections, roof inspections, home inspections, sewer, lateral and pool inspections.
[00:02:35] Speaker A: Unbelievable. That's just the whole gamut. Depending on what the customer wants. And generally speaking, as a realtor, I find that they want to usually stop with the first three, the termite inspection, the home inspection, and the roof inspection. But sometimes it's important to get the sewer lateral inspection because some counties and cities require that. And then you kind of know what that potential expense could be should it fail in the future. So that's a really good thing. I'm glad that the company does that. I haven't used it yet for that one, but we'll certainly in the future. So many sellers order the home inspections and pay for them ahead of putting their home on the market. Why do they do that?
[00:03:18] Speaker B: We've always encouraged people to get the inspections upfront. I don't know how you would put a house on the market, know the value of it if you don't know what your expenses are.
[00:03:28] Speaker A: Well said. Well said. And so the sellers will actually pay for that. And as part of their upfront cost, it also goes into your tax base. When you, when they go to sell the home, too, you know, you can take that off there because that's an expense that's incurred in the selling of the home. But if the buyer wants to know this, also, if the there's a reputable firm there, quite often he will waive having to get his own inspectors to move forward and use the reports that you already have. They trust in what the inspector has been provided and therefore they don't have to pay for it. I totally agree with you. If you're going to put a home on the market, you got to know the condition of it. And also by doing that and posting it, it also gives a feeling of confidence that the buyer, any buyer that comes to the plate will have in the property and say, well, maybe I'll give a little bit more to have this home because it's in great shape. So that's a good way to go. It used to be, though, when the market wasn't as active as what it was, that people would wait, they'd get into contract, the buyers then would get their inspection, which would require that contingency period to make those inspections and approve of those inspections before you could move ahead with a deal per the contract. Interesting.
In your view, is there any type of inspection more important than another?
[00:04:55] Speaker B: No, there's not. The different inspections cover different areas. Some areas they overlap a little bit, but for the most part, they're standalone, separate inspections.
[00:05:06] Speaker A: I've always thought that you got to do the minimum of a termite inspection. You got to know the condition of that home and know if you have any section one items which are fungus.
[00:05:17] Speaker B: Damage termites, dry rot, things that have caused fungus damage or termites, plumbing leaks, those types of things.
[00:05:24] Speaker A: Right away, too. You got to know those. And they. A lot of lenders will require those to be fixed on some contracts and some lending arrangements. They require them to be repaired and cleared before they'll actually fund the loan.
[00:05:39] Speaker B: Correct.
[00:05:40] Speaker A: So, yeah, there's a home inspection. How would you define what a home inspection really is? What does it contain?
[00:05:47] Speaker B: A home inspection is generally a health and safety and functionality type of inspection. We check for health and safety, trip hazards, electrical issues.
We also check, you know, for failed window panes. Appliances are working properly. Heaters and air conditioners are working properly.
Foundations where they have cracks, you know, drainage issues, those types of things.
[00:06:14] Speaker A: Plumbing.
They even check the appliances, too. And, you know, as an overview. So it's basically a general overview of the property made for the purpose of saying, well, this works. That doesn't work. I crawled under there. I looked at the foundation. The foundation's in good shape. These inspectors actually crawl underneath the home if there's a crawl space, and they crawl into the attic, too. So if a homeowner is going to have a home inspection, you certainly want to have any barriers to access to those areas clear so that the inspector can take a look at it, right?
[00:06:49] Speaker B: Yes. It's important to have the property prepared for an inspection so you get a complete inspection the first time. So you know what you're dealing with.
[00:06:56] Speaker A: Yeah. If you have to call them back in order to do it. And I've had this happen before, there was something blocked. Blocking a look at the foundation in the garage or whatever. It's been written up for further inspection. What happens with your firm if they have to call back to do that?
[00:07:12] Speaker B: As long as those areas are made accessible, we come back at no additional cost and then take a look at those areas.
[00:07:17] Speaker A: Just time.
[00:07:18] Speaker B: Right. And just issue a supplemental report.
[00:07:20] Speaker A: Yeah. Because on the real estate purchase agreement, everything is based upon a timeline. And if you have a problem with these timelines, then, you know, it can. It can rock your contract a little bit between the sellers and the buyers. That's something you really don't want to have happen when you get it in a contract. As a realtor, I can say I want it to go smoothly so that, you know, everybody is feeling pretty good about their deal, not to delay and then miss a deadline that may be on a contingency removal, so to speak.
[00:07:52] Speaker B: Time is of the essence.
[00:07:53] Speaker A: Of the essence. Now, on the termite reports, let's talk about termite reports. For a while. Section one items are, they can be from wood damage, deterioration, mold, whatever. It could also be from termites. Subterranean. I think you brought me up to speed once on subterranean termites. You are cornucopia of knowledge, Mister Reese.
[00:08:16] Speaker B: Doing this a long time.
[00:08:17] Speaker A: Yeah. What is the difference between subterranean termites and just standard termites?
[00:08:22] Speaker B: We have two types of termites we deal with. Well, actually three. Drywood termites are very common. They live in the structure. Those are termites that a lot of times you'll see a tent over a home. They're fumigating for drywood termites. Subterranean termites are a colony of termites that live in the ground and they come up into the house, eat the wood, and if there's no moisture source, they generally have to go back into the soil about every 72 hours to get moisture to survive.
They're relatively easy to get rid of and pretty easy to detect.
And then we have Dampwood termites, which we deal with mostly on the coast.
Those types of termites, they have to have a real moist environment. So you replace the damage, eliminate the moisture source, and they just go away.
[00:09:08] Speaker A: Hmm. Pretty interesting. Pretty interesting. I know that with termite reports, home guard can do repairs and mitigate these issues, whether or not it's be deteriorated wood, or whether or not it be termites, or whether or not it be subterranean termites. And does it quite effectively, actually.
So with section one items, those are the ones of most urgency, correct?
[00:09:33] Speaker B: Correct.
[00:09:33] Speaker A: And section two are.
[00:09:35] Speaker B: Section two items are maintenance type items, things that eventually could lead to fungus damage or termites, like plumbing leaks, earthwood contacts, roof leaks, those kinds of things.
[00:09:48] Speaker A: I noticed on the home inspection report that there's a lot of redundant information as far as if there's wood damage, so to speak, from the termite report, you're going to also usually see it on the home inspection report, too. So they're actually, you got them on both reports, so you kind of know what's going on there.
I noticed that today with the construction trades, it's pretty expensive to get things repaired. So you're quite often best just to go with what the termite report asks in order to remedy situations like that, especially for termites or for subterranean types of termites or so forth. There's a bid estimate at the end of the report, generally speaking, that lets you know what homeguard would charge to have it fixed. And that's really pretty good. We've used that numerous times to much success on the home report. It doesn't have that.
[00:10:49] Speaker B: We're not allowed. The home inspection industry is not licensed. The pest control industry is licensed through the structural Pest control board. The home inspection industry is certified. Our inspectors are certified through a company called Ashi.
This is, they set a standard for the home inspection industry, so their code of ethics does not allow them to give estimates, even give referrals for work. They just refer it out to generally to a contractor, electrician, a plumber. Depends on what they're looking, what they find.
[00:11:25] Speaker A: I understand. And so you don't really have an estimate for repairs on a home, which is, that's the normal, that's the typical for all inspection companies. But yet you could make repairs on those reports if you can't.
[00:11:40] Speaker B: No, we do. We can do repairs on the termite reports and the roof reports because they're licensed through the structural Pest control board and the state contractors board.
[00:11:50] Speaker A: Gotcha. Gotcha. That's interesting. You know, it takes you a while to pick all this stuff up. Now, roof inspections, you know, a lot of people don't realize how many different types of roofs that there are.
We're going to take a short break. Be back in a moment.
[00:12:06] Speaker C: Remax, if you or someone you know is thinking about buying or selling a home, call the Michael Hatfield re max team at 925-32-2775 that's 925-32-2775 or visit michaelhatfieldhomes.com. that's michaelhatfieldhomes.com. now back to our show.
[00:12:31] Speaker A: So when you send them out there, they look at the type of roof, and then each roof has its certain type of characteristics, composite or whether or not it's tile. You walk on the tile, you can crack them sometimes. And these guys have to be experienced to be a good roof inspector.
[00:12:46] Speaker B: Oh, absolutely. You can get up on the tile roof and do some damage if you don't know how to walk on it. Yeah, we have a gamut of different types of roof coverings, from foam roofs to wood shake and shingle roofs, which aren't as common anymore. Tile, slate composition, different types of composition, like torch down.
There's just a gamut of different types of roofs. And they try to identify the wear characteristics and identify where moisture intrusion is and the condition of the roof and.
[00:13:19] Speaker A: How it connects into the gutter system is really important, too. Right? Because I've always been told, and you have to correct me if I'm incorrect, that the underlayment for the roof tiles or the actual finished roofing shingles is extremely important in how it's done and how it connects to the gutter system, and if not, it starts a leak. And now you've got section one items down in the walls and in the rest of the house. But how do. How do they actually put the underlayment down on roofs is really important. And how it connects to that gutter system is really important. If not, you're going to get issues with the rafters, the rafter tails and such.
[00:13:58] Speaker B: Right, right. Yeah. We find that they don't create a drip edge with the shingles into the gutters. So it just runs behind the gutter and gets down into the roof eaves and rafters and fascias. And it's probably one of the most common damage we find.
[00:14:12] Speaker A: Yeah, I can see we're on the same page on that one. Many of the reports have, you know, rafter tail deterioration, so to speak. And how do they repair those like that? They can't tear the whole roof up unless it's really bad throughout on the actual rafter. But the rafter tail itself, how do they repair those?
[00:14:30] Speaker B: Oh, there's a number of different ways you can do that. You can actually just replace a section of it and put another piece alongside of it. I don't care for that because it's not aesthetically pleasing.
The best thing to do would be to take off the roof covering, take the eaves up, replace the rafter and put the eaves down and patch the roof right there.
[00:14:47] Speaker A: Wow. So with that said, you have a roof inspection company and you have the ability, you're actually licensed to make the repairs on the roof as well as on termite or pest damage. You can still do that same thing. You can repair any damage that you have there because you are certified home inspections. You make these observations, and then the client has to go out and find a contractor to take care of it on the termite report. The interesting thing about it, I didn't know it for a long time, is that when you do an inspection, isn't it kept in a database in the state somewhere?
[00:15:29] Speaker B: Well, they used to do that. Now what they do is we do what's called WDO, would we send just the address to the state and they archive that. And if something happens and somebody wants a copy of that, they just call, they look that property up, they call the company, then we provide them with a copy of the report and they disperse it to whoever's requesting it.
[00:15:53] Speaker A: Interesting. Interesting.
[00:15:54] Speaker B: They keep them for two years.
[00:15:56] Speaker A: So let's just say that we have this. This subject property, and it had four or five different section one items, and we call your guys out and they repair it and such, then they clear it. The section one clearance is really kind of an important thing in the home buy sell process to have that clearance on those section one items, whether or not it be from an emotional standpoint for the buyer, just feeling more comfortable that they're resolved, or whether or not it's because it's lender required. A lot less lenders require it now than they used to, but still, they're still out there. The underwriter says, no, we gotta have to clear that or something. Sometimes it's usually because the agent has mentioned it somewhere in the documentation, and that's focused in the need to have it, that section one item cleared. But interesting, interesting. So now, we talked about the home inspection. What about natural hazard? We were talking earlier about that natural hazard report. What is it?
[00:17:00] Speaker B: Well, it's a. It describes whether you're on a fault line floodplain, whether there's known fuel tanks have been buried on the property, any adverse weapons, weapons, meth labs that have possibly been, you know, in that home or on the property.
It's a. It's a disclosure for the buyer.
[00:17:25] Speaker A: Required seller disclosure?
[00:17:26] Speaker B: Yes.
[00:17:27] Speaker A: Yeah. Actually, we, meaning my real estate crew, when we list a house, first thing we do is request a natural hazard report right away as the first disclosure. And what we like to do is we like to post the seller disclosures as soon as possible so that anybody that wants to put an offer in on the home can already see that the seller is provided the natural hazard disclosures. Usually. Natural hazard disclosures, generally things that the homeowner doesn't have. At top of mind, he or she may have lived there for 25 years and didn't know that there was an indian burial site out in the backyard, or whether or not weapons were buried from a naval ordinance place and fuel tanks within a mile. And those kind of things that are required that a seller provide the buyer, but the seller doesn't know. So the seller fills that box by engaging the natural hazard company, which in this case would be home guard, to provide the natural hazard report so he can give it to the buyer. I don't know if that made everybody get wrapped up in a ball, but it was perfectly clear to me.
So homeguard does provide natural hazard now?
[00:18:46] Speaker B: We do provide those, yes.
[00:18:48] Speaker A: What other reports do you have at homeguard?
[00:18:51] Speaker B: We do pool inspections, sewer, lateral inspections.
The pool inspection is basically part of the home inspection. It's a general overview of the pool equipment, the electrical system, the pumps. They check the lighting, make sure everything is working properly. If they do find that there are issues, they refer back to a pool specialist, come out, evaluate it, and do whatever it takes to fix it.
[00:19:18] Speaker A: It's kind of like a home inspection, I think. Kind of like being your primary care physician. You go once a year, you take your checkup and he checks the blood and everything else and, oh, well, I think we got to take a look at this a little closer. And then you're referred out to a specialist to get it done. So pool inspection is a lot of the same kind of thing.
[00:19:38] Speaker B: Yeah, I use that same analogy.
[00:19:39] Speaker A: Do you really?
[00:19:40] Speaker B: Yeah, you go to your general practitioner.
[00:19:42] Speaker A: I knew I liked you.
[00:19:43] Speaker B: Your knees hurting? You know, they go, okay, then we'll just refer you off to an orthopedic person. That's. I use that a lot.
[00:19:49] Speaker A: Yeah. It's kind of an important way to go. Now, sewer laterals, sewer laterals are big deals. And the reason is that the repair on a sewer lateral is sometimes very expensive. What is a sewer lateral, Mister Reese?
[00:20:06] Speaker B: Sewer lateral is the sewer line that goes from the house, basically from the foundation of the home out to the main sewer line in the street.
That is the sewer lateral. And they can be very costly to replace, especially if they go out into the street and you have to tear up asphalt and, you know, dig down, you know, 15ft to get to that, to replace it. It's a lot of work.
[00:20:25] Speaker A: You got to hire the menehunis out there to hold the red flag, to stop traffic and everything else while they're digging up the street. And if it's a busy street, it's tough. And the reason we say you'd have to dig up the street is because usually the sewer main runs pretty much down through the center of the street.
[00:20:43] Speaker B: Correct.
[00:20:44] Speaker A: And so everybody connects to that sewer main.
The sewer lateral itself is generally the responsibility of a homeowner, whereas anything on the main itself is a responsibility of the city or the municipality, so to speak.
[00:21:01] Speaker B: Right. A lot of the municipalities are different.
The cities will take responsibility up to the sidewalk, anything from there up to the house, responsibility of the owner. Some of them, they're responsible all the way down to the sewer main. And yeah, it can get very expensive.
[00:21:18] Speaker A: I noticed some cities in the Bay Area require you to have a certificate of compliance. Others, even though you've complied, you don't really get a certificate of compliance. Oakland East Bay mud, I think, is the one that issues that certificate of compliance. And also you got some issues over there with now with sidewalks that have to be inspected before the home will be allowed to transfer into the new owner's name. But sewer laterals have always been an issue. And is this relatively new for home guard to take on this and do this sewer lateral report?
[00:21:57] Speaker B: Yeah, we just recently started doing it. It just became mandatory in most municipalities when a house sells or they do a major remodel to have the sewer lateral inspected.
[00:22:09] Speaker A: Absolutely. Absolutely. And what does that entail? How do they inspect that sewer lateral line?
[00:22:14] Speaker B: Well, most, well, a lot of the times are to clean out a pipe that comes up out of that sewer lateral with a cap on it up next to the house. And we have cameras that we run down there. We run it all the way down to the main and slowly pull it back, take a video of it, make comments on what we're seeing, why we're doing that inspection. And at the end of the inspection, we issue a report, videos attached to the report, and we provide that to the homeowner and they provide, we also have another document that we fill out for every, you know, management company for the area. And they provide that to them and they get their certification from the cities.
[00:22:58] Speaker A: So if it fails, that's going to be a contractor, someone else that comes out and has to be engaged to repair it, right?
[00:23:05] Speaker B: Correct. We have contractors that do do that. It's not necessary that they use us to do the repairs. They can use anybody who's licensed to do it, and then we can come back and re scope the line to make sure that it's correct.
[00:23:17] Speaker A: So Homguard does repairs on sewer laterals?
[00:23:19] Speaker B: Yes.
[00:23:20] Speaker A: Oh, I didn't know that one. Yeah, I learned something every time I see you, brother.
Well, that's super. That's super. Have you got anything to add to some of this that we've talked about?
[00:23:33] Speaker B: Michael, one thing I can't stress enough is to read the reports, the entire reports, regardless of who the company is, who's performed them.
And if you do not know what you're reading or understand what you're reading, call the company, speak to somebody that has knowledge that can explain what you're looking at in the report.
Most of the time, what I do, people call in, they're concerned that we missed something. I have to go through the report and read it to them. And it's what I do every day, all day long. So I cannot stress enough to read the entire report. The pool safety equipment, you have to meet two different requirements for pool safety, whether it be self locking gates, alarms on windows, and doors that go out into the backyard where the pool are alarm on the pool cover fencing around the pools. And it's important, you know, it's. Nobody wants to see a child drowned in her pool, right.
[00:24:36] Speaker A: You know, I'm not positive now. We always bring it up with our buyers, you know that there has to be two of seven complied with by state mandate. And I know that's necessary for building permits but I'm not sure, I'm not certain if it's required to sell the house. But we always bring it up anyway because you don't want to have any issues like that. You know, we have clients looking now at homes with pools because they. They love to swim and you know, young kids and you think about them a lot. It's good as part of the pool inspection that they bring that up in the reports, I do believe. Well, that's just super. Anything else that you want to bring up?
[00:25:15] Speaker B: Oh boy. No, I think we covered a lot of this.
[00:25:17] Speaker A: Yeah. You know, fortunately in the past I mentioned with Mister Reece that I've been involved in the building of a home and you learn a lot. Even though I'm not going to say that I'm a general contractor or an expert in any way, but I will say that having home building experience will help any client looking to navigate through the reports. The home inspection, the termite inspection, the roof inspection or any of that. And so that's part of our service is to interpret them with a little bit more knowledge than most people would have as a realtor. And I've always said that get someone with experience, somebody that's a solutionary and someone you trust as a real estate agent, you can use us or you can use anybody that you want. It's up to you. So Mister Curtis Reese, senior vice president and general manager of Home guard Incorporated, thank you so much for being on the show and sharing your considerate knowledge and experience. Many of our listeners have learned quite a bit they didn't know before about all the home inspections available to them and why they are needed. A sincere thank you. You've been listening to real estate and more on KGO. 08:10 a.m. the spreadsheet I'm Michael Hatfield, your host. Tune in next Saturday morning at 09:00 a.m. when we once again talk about the real estate market. Today's topics and meet interesting people. Our best until next week.
[00:26:45] Speaker D: The views and opinions expressed are based on current economic and market conditions and are subject to change. Information on the show provided for illustrator purposes only and does not constitute professional or legal advice. Information from sources deemed reliable, but accuracy and completeness not guaranteed. Michael Hatfield and the Michael Hatfield remax team have no liability. For information discussed on the show, consult with qualified professionals prior to taking action.
[00:27:15] Speaker C: We at the Michael Hatfield re Max team enjoy representing our valued clients. If you or someone you know is interested in buying or selling and wishes to schedule a complimentary appointment with the Michael Hatfield re Max team, call us at 925-32-2775 that's 925-32-2775 or go to our website, michael hatfieldhomes.com dot.
[00:27:38] Speaker A: I'm Michael Hatfield. Thank you for listening today. Join us next Saturday at 09:00 a.m. for the next real estate and more when we again sharpen our focus on how's the market.
[00:27:49] Speaker C: Join us next Saturday morning at nine and have a wonderful week. Best wishes and blessings to.
