Coaching

by Bob on August 30, 2008

The Noise Of Silence

Recently I had the opportunity to speak in front of the Arizona ASHI members at their 2 day conference in Mesa. Kinda my first big speaking gig in front of a large audience. Wish I could say it went better. And I say this, not because the material presented was bad, it was the delivery or lack thereof. If I could do one thing over it’d be the opening 5 minutes, as this is where I mentally struggled to get my pace and thoughts on track.

It was just after asking the first simple question to the audience that I’d gotten thrown off and gored by the white noise. You know, the noise in your own head when your are greeted with silence from the crowd after asking for feedback. Your not sure how to react, and that was where I fell. I reacted by talking louder “at” them, which made me feel better, but further distanced me from the audience. But I do have to say this, I risked it and I learned from it. Stepping out and doing what others won’t or can’t is how you grow personally and professionally. Not to mention monetarily.

There were some who thanked me for the presentation and others who chimed in and said it was what they needed to hear. But I knew it from the moment the white noise hit, that personally, I had bombed. I missed the connection, or maybe it was that trust hadn’t been established, or…. So many thoughts of what went wrong, and I had them all in the split second that I recognized the white noise of an unresponsive audience.

What makes this post so annoying for me is that the same thing happened during a Webinar I hosted the other night on Phase Inspections. Six home inspectors on the line and none would volunteer feedback on the easiest of questions.

I’ve thought about it a lot since then, to the point of signing up for Toastmasters. I’ll post on how the first meeting strikes me.

by Bob on August 24, 2008

Home Inspection & Negotiation

This article was written for the Vail Sun (local newspaper), for an up coming home buyers seminar. The article took a few hours to write but it was well worth the FREE exposure.

Home inspections are now considered a necessity by many Realtors and for good reason. Clients who do not want a home inspection are often times asked to sign an advisement notice. Something that says that they were counseled to have an inspection done, but decided otherwise. Making a client acutely aware of the importance of a home inspection is now stock and trade for anyone in the Real Estate profession.

Why is it that important? After all it’s another few hundred out the door and the fee’s are piling up. We’ll for the buyer, it’s a built in re-negotation tool. The standard real estate contract has a satisfactory (to the buyer) home inspection contingency clause.

In Arizona, after acceptance of an offer, there are no more counter offers except in the case of a contingency such as a home inspection. You can’t just decide not to buy the place without giving up your escrow funds unless a contingency is in force.

If a buyer is not satisfied with the condition of the property he can ask for the escrow funds to be returned and continue his house search, or, if he still likes the home but not at the cost of repairs, request of the seller, re-negotiated terms covering some or all of the anticipated costs.

The seller upon notification of an unsatisfactory report, also has the right to refuse further negotiations, return the escrowed money’s and wait for another buyer, or, the more probable response, re-negotiate the terms with respect to the inspection report.

In a buyers market, this is powerful stuff that can save you big dollars if the property needs some work.

Having major repairs or large maintenance issues addressed at the negotiation table will greatly enhance the homeowner experience. Not to mention keeping some of your hard earned cash in your pocket.

A client last week sent me an email expressing thanks for the great job and gave me a few details on how the transaction turned out. She was one of those clients that didn’t think she really needed a home inspection and was sort of talked into it. In effect she re-negotiated to the tune of $9,500.00 as a result of the report, which was a bit more than the anticipated repairs to the property.

According to the American Society of Home Inspectors (ASHI), a home inspection on average, returns about 10 times on your money. Not bad odds, and my direct experience proves this out. Just a hand full of the hundreds of inspection I do a year have less than the inspection fee in reported repairs.

Warning: Home inspections are not a commodity, you can’t buy the exact same report from two different providers. The experience and education that each individual home inspector brings to the table varies widely. As such, price shopping for a home inspection is akin to price shopping for a brain surgeon.

Not getting the best you can afford may have dire consequences to your pocket book and rainy day fund.

Bob Kille

Acuspect Home Inspections

www.acuspect.com 520-237-8965

by Bob on July 29, 2008

One Contested Seat

board room meeting I just submitted my ballot for the Arizona ASHI chapter leadership and while doing so, it struck me that there was actually a contested seat on the board. So what that means is – only one home inspector out of 135 Arizona ASHI members thought he was better qualified for the position than the selected/persuaded opponent. A home inspector who actually stood up and is asking for the spot for his own reasons.

What could some of the reasons be? Well, chief among them, becoming known. This may not be his reason of course, but it could be yours. There is also the nice attribute of having something meaningful on your list of credentials and a nice healthy networking experience.

Given the choice, so few home inspectors step out of their comfort zone and up into an easily attainable spot of notoriety among their peers. Why do I say – easily attainable, well for the most part, most of these guys had to be asked/persuaded to volunteer by someone who wanted to vacate the spot. Very few actually campaigned, or for that matter, asked for the seat.

I ask you, what better way is there to become the professional home inspector that you aspire to be? Not many of us are comfortable in a leadership role, but that uncomfortable edge is where life is lived and rewarded. The REWARDS you say? Yes, the rewards can be staggering on the road less traveled. At times it feels like a super highway the way things hit you so fast.

There’s only room at the top for those that put themselves in a position of learning and serving. I can’t think of a better place to stick you neck out for the first time than that of the company of your peers. I hope to see at least two contested spots next year, heck I might even throw my hat in the ring again.

by Bob on August 26, 2007

Home Inspector Round Table

Bob Kille Acuspect Home Inspection The Arizona American Society of Home Inspectors educational conference has come and gone. As always, the ones who just can’t get enough education, stay awhile and talk over a few beers.

The last to leave the conference room, it struck me funny that those that need the interaction of the fellowship the most, the new entrants, sought out their education only from the classes offered. It has been my experience that going early and staying late has always been much more educational than the actual event. The lunches and the breaks are where I have personally benefited from a lot of good inside advice, well worth the admission.

In my opinion these events are more about creating relationships than they are about the class offerings. That’s probably a secret, whoops. While the classes may be educational, not showing up early and/or staying late to strike up conversations at these events is a huge mistake. If your the insecure type and just can’t get up the nerve to start up a conversation or step into a gathered circle, seek out some help before its too late.

Home inspection, in case you haven’t figured it out yet, is a relationship business.

by Bob on April 4, 2007

Right Between The Toes

Bob Kille Acuspect Home Inspection This short essay is about initative and addictive behavior.

It just so happens that my sister is in the handcrafted soap business and is struggling to get it going. Much of what she sells is done through craft shows at a display booth. Like all the others, your at the mercy of the traffic flow past your booth. Any signage or hawking you can do to get a prospect to stop is what makes or breaks your day. Similar to your home inspection ad copy in any medium.

So on with the story, I’m on the phone speaking to my sisters signifigant other and he starts telling me what happened to him out at the craft show he did alone over the weekend. The show had a fairly light attendance and Ronny who is addicted to talking (just ask anyone) wasn’t getting anyone to stop at the booth. Ronny, I should mention is a Harley rider and looks the part, beard, tank top, chained wallet, tattoos and all. Yep, selling soaps and lotions at a craft show.

When an addict needs a fix he doesn’t stop to think about all the reasons why he couldn’t possibly get it, he just focuses all his energies in one direction. So here’s Ronny with no one to talk too and getting sore feet to boot. Then it hits him! Ronny had a recent heart bypass and takes along a folding recliner and foot stool when doing the craft shows. He could get it em out and rest his feet or…

He could sit the ladies down for a free foot massage using the featured lotions.

Out came the recliner and down sat the ladies. The booth quickly became a “giggle fest” as Ronny put it, that lasted the entire day. Other vendors came down to see what all the fuss and traffic stoppage was about and so did the local TV crew. The next day was the same and along came another TV crew for the nightly news. If this wasn’t enough, one of the other vendors has a local radio show and asked Ronny to come down to the station for a live interview for Misty Mountian Soap Company.

In my opinion the ladies just wanted a biker to massage their feet and bought the lotion as a souvnier. Just kidding Ronny.

Initiative and addictive behavior seem to have alot in common. Think about it.

by Bob on March 10, 2006

Simultaneous Diversity

Bob Kille Acuspect Home Inspection Know what the worst number in business is? It’s the number One. One product, one service, one marketing strategy, one key client, one key market, you get the drift.

Relying on the “One” is a setup for disaster and why diversifying not only your business model but the way you think is worth considering.

Most self-employed inspectors think only in terms of “Present Income”, not in terms of locked-in future income or equity. Think retirement. You need to develop a business strategy that takes “both” into consideration through to implementation. An example of this would be thinking of your business as a job, to pay your bills, instead of as a way to retire with multiple income streams.

Consider this, most home inspectors try to achieve whatever success they seek sequentially. First, they get an education. Next, a job or start a business. Next, attempt to make a good income. Next, after about seven years they start to think about savings and retirement. And so on.

Entrepreneurs who get wealthy, and I’d like to someday count myself as one of them, live simultaneously, not sequentially. This is both a different mindset and the use of a different set of practical skills. Developing new ways to make your home inspection business grow and resources to do it requires “Thinking”, “Next step planning” and action.

The “Thinking” and “Next Step Planning” are two distinct aspects of a project and both must be given equal continual attention. Anytime you have to do something again and again, the systems approach is best. A to-do list just can’t handle the complexities of several open projects.

So, to this end I’ve been setting up a system for a “Daily” routine that involves planning and review of my projects. I’ll post some of my thoughts on what worked and didn’t as the year stretches on.

by Bob on March 3, 2006

Whatever

Bob Kille Acuspect Home Inspection Some times people just don’t get it, for whatever reason. Here I was at a re-inspection of a nice new big custom home at the pre-drywall stage. Our site supervisor is insisting that I shouldn’t ding him for a minor staircase imperfection of 1 inch in height difference between the risers.

With a big smile on my face and my head moving slightly left to right I waded in with the motor skills studies that determined why risers can be no more than 3/8ths difference in height.

His argument back to me was that the tile floor was not yet in place and that should bring up the lower riser by about 5/8ths of an inch, which by the way would put him at the 3/8th inch maximum tolerance from highest to lowest risers.

That sounded logical until I asked if the stairs were going to be left bare, without a floor covering of their own. To this he replied that, the carpet would be minimal in thickness and shouldn’t really be considered because it would only put the risers out of maximum tolerance by just a bit.

So if my math is approximately correct, carpet padding is about 1/4″ and the carpet itself even if on the thinnest of sides would measure at least 1/8″ in thickness, leaving a 5/8th difference in riser heights. Just a bit over the max of 3/8ths, a bit being 60%.

I received the same story again on how expensive it would be to start over to fix the slightly over tolerance issue. My first suggestion to him was to let the sub contractor worry about that and his first concern should be to the safety of the occupants. I could tell that I’d lost him on the safety concern so I put it another way.

Imagine, after documenting the safety hazard at the stairs you fail to do anything to correct it and someone get hurt using the stairs. I wouldn’t want to be the one explaining to a judge that it was just a “little bit” over tolerance would you?

Well, I thought I had em, but site supers can be tough minded and this one was no exception. His reply was that the boss wasn’t going to make him fix the dang stairs anyway as an accident is unlikely, so let’s just move on.

I paused a moment, and asked what’s going to happen when the house is resold and the home inspector declares the stairs a safety hazard? It’s clearly out of tolerance and the Registrar of Contractors Workmanship Standards would clearly dictate that the stairs be made safe, i.e. reconstructed.

Add attorney’s fee’s onto whatever it costs to reconstruct the stairs at that late date and your boss will probably see the wisdom in calling back the sub contractor to fix it now. “Whatever” is the educated response mumbled my way as he saunter off clearly disgusted with me, not wanting to discuss the rest of the list.

Funny how things work out. Not one hour after leaving the site I got a call to do a home inspection on a brand new home in the same neighborhood, same builder, different staircase, same stair problem. Yep, a 1″ difference at the first riser on a real nice all finished wood winding staircase, sides wood paneled with a nice custom Newell post at the first tread.

Whatever happens, and it won’t be coming out of my pocket.

by Bob on February 25, 2006

Make Cents

Bob Kille Acuspect Home Inspection Those of you who read my posts generally know my business philosophy of paying out for any compliant, whether valid or not, up to a point of course. When you do a lot of inspections the addresses and clients are mostly vague memories so when you get the question, “do you remember the job you did at such and such, for Mr. & Mrs. blankety blank about 3 or 4 months ago?”

Well, I got that question as I was getting out of my car from the realtor, who happens to be by the way, one of my better sources of referrals. One of the reasons he uses/recommends me is that he knows I’ll take care of his clients without question. What I mean is, without “PROBING” questions.

Here’s why probing questions are out, and it’s a funny thing. When you start to question, you’re mind, unknown to you, is really just trying to justify why you shouldn’t be held responsible for the yuckety yuck problem. And in asking the probing questions your voice betrays you by sounding a bit indignant.

Questions with this tone, and its not one you can easily refrain from, also puts the realtor who brought up the questionable oversight on the defensive. What you really want is them to feel relaxed with the impression that they’re helping you with your relationships. i.e. (your customer base, and don’t forget the realtor is part of your customer base).

To combat this unconscious indignant tone and to put the realtor at ease I say, in an upbeat or apolegetic way, “So what did I miss?”. Thereby taking the position that whatever the problem is that comes out of his mouth is my fault, and the questions that I ask are ones geared to fix the condition while assuring him that the bill can be sent to me.

Whatever you do, make sure to thank the realtor for bringing this to your attention. I try not to offer any assitance in resolving the matter outside of an offer to pay, as quite often I’m never contacted for payment and I’ve still made good on my word to take care of any compliants.

So to get to the meat of this post, in being so ready to take responsibility with just a vague memory of the property, I had just agreed to fix the sellers problem. Turns out the realtor was the listing agent and the seller was renting back the property. When they were fixing to disconnect the washer at move out but the valve was stuck open. They complained to their listing realtor (the realtor in question) that the home inspector should have caught the condition so they shouldn’t be responsible because after all, it wasn’t their house anymore. Now, doesn’t that make sense?

I know, I know, there’s lots of good reasons why this shouldn’t be my problem and that just goes to show you why you shouldn’t go down that bumpy road with your voice betraying your real feelings all the while souring your relationship with the realtor.

You’ve got to know what the lifetime value of a good realtor is, so that this all makes cents. Yes I mean “cents”. Last year I performed over 30 inspections for this realtor at approx $300 each or $9,000 dollars worth of gross income. To make him feel any other way than that of helping me when he presents his sellers dilemma would be foolhardy at best.

My only problem now is to figure out how to get a wavier & release form signed by my client to make the payout. Company policy is never to payout without a signed wavier & release. Had I know from the start before I agreed to pay, whom I was paying, I could have at least requested that my client make the request. Now that it’s akward, by that, I mean to go back to the realtor to explian all of this, I’ll probably let it go and just pay the seller.

by Bob on February 12, 2006

Packy

Bob Kille Acuspect Home Inspection

Of all the things I could be writing about from my experiences at the NAHI & NACHI national conferences I pick this one experience cause it just sticks in my craw. I can’t decide if I’m just getting old and boring or if there’s a bigger cultural reason for rudeness.

All right, I’ll set the scene and you decide. I was with a new group of friends that I’d met at the vendor booths. We were all standing in the lobby waiting for a table at the local Olive Garden. Among us was a nice young girl who says she can’t order alcohol because she’s only nineteen.

Lets just call her Packy for now. Packy wants to know if I would be so kind as to order her a drink from the bar to which I respond, what will you have. Sex on the Beach or a Blow Job she replies with a straight face.

Not being much of a barfly in the last decade I wasn’t sure if she was putting me on or not. I’d be embarrassed to drink it yet alone order it, but here I go up to the bartender to ask for a Blow Job.

Yeh, it was embarrassing, the bartender didn’t know how to make one and I sure as heck wasn’t going to say I knew so the bartender points his finger at me and starts telling the patrons that the drink I ordered is called a Blow Job, did anyone know what’s in it. Turns out, someone did.

When I returned to the group with Packy’s drink and a slightly flush face I notice that Packy was busy with her phone, look like text messaging. So I’m standing there with her drink in my now cold hand chatting up and laughing with the others for a few minutes.

Curious to how someone could text message for so long on a phone I asked her who she was talking to, without looking up she states that she’s playing pac man on her phone and is nearly finished.

Now I don’t know about you, but as far as I can remember whenever I stood around with a group of friends talking and joking, none of them were playing pac man on their phone like the rest of us didn’t exist.

So I gota ask myself, were we that boring or is there a generation x/y thing going on here.

by Bob on January 22, 2006

Part II Worst Inspection Report

Bob Kille Acuspect Home Inspection As promised, the rest of the “Worst Inspection Report”.

In the last post on this topic I eluded that the report format was basically a check box with some arcane letters standing for a particular condition. When a notable defect or condition was encountered the inspector added a corresponding color-coded comment. The rest of the text of the report was mostly disclaimers and minor adjuncts as to how the inspection was performed.

So, what happens with this type of report is that, the reader quickly surmises that all he has to do is read any colored comment and he’ll have assimilated the germane issues of condition prior to escrow. What you have to remember though, is what effect color and font type/size has on the reader. The buyer as most realtors recognize is already in a state of buyer’s remorse and is looking for either a confirmation that the choice was a good one or an easy way to keep looking without explaining his fears. The (RED) color coding may not seem like a grievous error on its own but added together with the rest of the mistakes makes mountains out of mole hills.

The rest of the mistakes? Well, I didn’t spend too much time unwrapping this story but in the few moments I did leaf through the report the following small errors caught my eye.

First thing I noticed right off was that the summary was at the end of the report and in the same red ink to further inflame the buyer’s psyche. These along with the small italic text (10pt), which can only further frustrate someone who’s anxious and has poor eyesight.

Also included in the report were pages such as “Crawl Space” when none existed. And weird comments such as “Did not walk flat roof – viewed from ladder with binoculars”

The next objection I had was that some of the comments had two recommendations listed instead of one. Comments should always follow the: Observed, Warning & Recommendation sequence for the observed condition condensing any recommendations into one statement such as: “Further review is recommended for a better understanding of repair/replacement costs and/or present condition”. Recommending how to fix or repair something should be avoided.

I only know the following because I was asked to perform the same inspection just days after this inspector made his appearance. The inspector missed broken seals at 3 large thermo panes and an improper roofing tile installation at the ridge.

Try to make your reports follow a logical sequence in plain type large enough for the average 60 year old with as little red ink as possible. If you include a summary, be sure its placed at the beginning of the report. The sum of the parts always adds up to the whole, and if the whole experience of using your service isn’t outstanding in the opinion of both the buyer and Realtor, your days are numbered.

by Bob on January 1, 2006

The Chicken Count

Bob Kille Acuspect Home Inspection It’s the new year and already I’m counting my chickens before their hatched. You see, today is my day to put together the report binders for the comming year. The first thing I do is to figure out what each binder is worth given the average price of a home inspection and then as I’m putting them together the chicken count starts up in my head and even tho its supposed to be bad luck, I can’t stop.

But seeing as last year and the year before were banner years and the same ritual took place I’m start’n to think that having a positive outlook is working for me. Some would argue that the set number of binders made up on this day would limit my belief system as to how much more is out there.

Not true I’d argue, as in the closing days of 2005 I landed a quality control contract for the new year with one of larger custom home builders in my neck of the woods and no binders required. Just a quick summary nailed to the wall of the garage and I’m out’a there.

I guess the point of this post is to suggest that you stay open to other avenues of growth. Try to get another pillar under your inspection bussiness so that a downturn in one aspect is softened by strength in another.

Don’t put all your eggs in one basket and your chicken count just might be higher than you thought possible. Happy New Year!

by Bob on December 19, 2005

The Un-negotiable Letter

Bob Kille Acuspect Home Inspection This is the next installment of the “Least Restrictive” article in which a fellow home inspector was heading for court over the word “few”.

It’s Friday evening about dinner time when the phone rings and a message is left. Dear home inspector, I just wanted you to know that I’ve sent out a letter detailing my demands for payment in the amount of $5,400 for the damaged adobe bricks on the yard wall.

This is a non-negotiable amount as it is considerably less than the $8,700 estimate in my possession for the total work needed. If agreement on this matter is not satisfied by next week the matter will be taken up in civil court, not in mediation, as you seem inclined to believe by virtue of your contract.

Well, have a nice weekend.

Yeah, right. I think that any communication back to him should be in the same manner, at his home phone Friday evening so he can mull it over the weekend.

If you haven’t read the previous post, the client in question is a shyster-lawyer. My theory about how all this is going to go down is one step closer to happening. The Theory? That the lawyer wants our good man to submit the claim to insurance so he can collect an easy $5,000 by merely writing a letter.

Most attorney’s know that insurance will settle almost immediately for sums of $5,000 and less because to get any type of defense set up and ready will cost at least that with no confidence in the outcome.

So what’s my advice to our hero?

Our home inspector has a lot going for him and I’ll just list the positives; mediation – arbitration in the contract payable by party taking action, fence is outside the scope of a home inspection – commented on as part of the pool barrier and listed in satisfactory condition for it’s age, inspection report recommends further review by expert on the effected “few” bricks. Total of 200 bricks with minor deterioration at the face per experts report.

Now the negatives; client claims that an adobe wall partitioning his property line is not a fence but a barrier and that it is in the scope of a home inspection, client claims that he relied on the word “few” to mean 3 bricks thereby negating the need for further review, client maintains that the condition or absence of the clear sealer for the adobe brick was not reported on and that its absence would have been germane to the sale price, client claims about 275 badly deteriorated bricks per expert.

So here’s the scoop as I see it.

Lay out the case in terms of money and lost opportunity costs and offer something reasonable as relates to his bottom line to make it go away.

Our lawyer wants to go to civil court – 1/2 day at $250 per hour = $1,000
Court remands the case back to mediation as per contract, lawyer pays the $500 mediation fee, losses 1/2 day at $250 per = $1,000

Mediation unsuccessful as lawyer wants the un-negotiable sum – case moves to arbitration per contract, lawyer pays the $500 arbitration fee, losses 1/2 day @ xx = $1,000

I happen to be a certified AAA mediator and I can tell you that neither party will get what they want in mediation or arbitration. So worst case for our home inspector is 225 blocks @ 12 bucks each = $2,700 + $600 for sealer = $3,300

At this point our hero and our lawyer have about 2 days into this if you count the prep work. So our lawyer is out the court and mediation costs, plus the time off @ $250 per hour. That adds up to, lets see…. $5,000 and change.

H’mm, doesn’t sound so appealing now does it?

Our home inspector also has some lost opportunity cost which add up to about $1,200 for the two days and possibly some legal advice amounting to $500 bucks, figure two grand. And don’t forget the possible worst outcome of $3,300 for a total of about $5,000 and change.

Arbitration is binding, but if the worst case happens to our lawyer and he gets a pittance he may take you go to civil court anyway to throw out the binding settlement agreement, 1/2 day @ = $1,000 If there’s a reasonable settlement @ about $1,500 – $2,000 your both still out your opportunity costs. Which in his case out weigh the settlement for a loss and that’s why he won’t take this the distance.

As you can see the math just doesn’t work for the lawyer unless there’s an easy settlement.

My advice was to put this all down is a similar fashion but without the specifics or admittances and offer up a one time offer of $1,500 to let him save face and get this nusiance over with. A little laungage about seeing it through to the end if the offer is declined wouldn’t hurt.

It will be worth watching just to see if my theory is correct. I’ll post more news as I get it.

by Bob on October 28, 2005

Examination By Peers

Bob Kille Acuspect Home Inspection Yesterday I had the opportunity to take a review by peer exam for the Arizona ASHI master inspector program. The program is not yet in place and the exam was only a trial so that the chapter could get some experiences in how best to proceed with the program.

My self and two others took the exam which consisted of; doing a home inspection, relating the major defects in an oral exam and then a small question and answer session followed by a show and tell photo exam.

The oral exam was a bit more difficult than I thought it would be. Many of my disclaimer types of comments are written in my report and I couldn’t recall exactly what they said when asked because I wrote them once a long time ago and really haven’t been asked about them since.

Even some of the terms I was using in my oral exam didn’t match what I had written. It’s kind of a high-pressure question and answer with the examiner playing stupid if you didn’t qualify what you were saying in layman’s terms.

The assumption that your client understands what you’re saying just because his head nods is probably a mistake. I think we get caught up in using the terms that as home inspectors we use everyday and expect that others are just as conversant in them.

Yeh, I failed. I needed to get a score of 10 must report on items in the home inspection and came up short by 3. Not to give too much away but I blew it in the areas of access, structure and appliance venting. Not inspecting one of the building’s rooms didn’t help either. How’d that happen?

Well, it happened because I was out of my normal routine. First, because this is a controlled environment you couldn’t use your own ladder. Second, you were not to occupy the same general area as one of the other participants which in my case altered my path. That’s how I missed the exterior storage room, bumped into another inspector and took another route. This can typically happen to you on a normal inspection when the client pulls you away to look at something and you don’t quite get back to where you stopped your routine.

Of the three items missed only one was something that I didn’t already know which had to do with access. The structure mistake was one I don’t think would have happened if I had been able to use my own equipment. The venting issue is one in which I don’t have any excuses, not that I’m making excuses, I just plain missed it.

It was a good experience and one that has me thinking quite a bit on how easy it is to mess up and a reminder that there’s still more to learn. Of course your most expensive mistakes are your best-learned lessons. I got to skate on my structure mistake which if in real life had come back to haunt me would have cost twenty large.

by Bob on August 8, 2005

Hallmark “When You Care Enough”

Bob Kille Acuspect Home Inspection I was reading an article about Joyce Hall, the founder of Hallmark greeting cards and thought I’d share his personal motto and how it fits into a business model. His motto is very similar to one I had adopted somewhere in my first year of business.

In his memoirs, “When You Care Enough.” Hall explains how he adapted a sign posted by one of his college professors, “Time is Money – save time” into a motto for himself: “Time is everything – save time”

In my business model I also hold a similar belief/motto, “Save Time – Create Relationships” This has proven itself, dare I say, time and time again.

Somewhere in your business model you have to address the issue of repeat business, how you’re going to get it. In every business there are only thee ways to grow a business; increase the number of customers, increase the average transaction value, and increase the frequency of repurchase.

For most of us, I’m referring to the home inspection businesses under five years, generating repeat referrals from your realtor contacts ( inspections ) may very well be a function of respecting their time. In my area, yours may be different; an average inspection time is about two hours. After that magic number expires the realtor starts to get annoyed and doesn’t really care how good you are anymore, they’ve got places to go and your holding them up. This especially applies to the high producer types.

My business model takes into consideration how long an inspection takes, where can I reasonably save time while still staying within the standards of practice and completing a competent home inspection on site. The business decision of doing the most comprehensive and all-inclusive inspection versus an on site inspection that is competent and referral generating is one worth considering.

For example, I don’t include photos in my residential reports as it takes an extra ten to fifteen minutes. This ten minutes would more times than not put me over the two hour self imposed limit. Remember, I’m doing the report on site, printed and handed over with an explination of the summary items. That’s a whole lota stuff to get in in less than two hours.

I did some homegrown research on the whole business of photo inclusion in the reports and here is what I found out. I asked fifty realtors if they would rather leave ten to fifteen minutes earlier or have photo’s included in the report; here’s what happened. A total of four out of fifty realtors stayed the extra ten to fifteen minutes. All four of them had out of town buyers who weren’t present at the inspection.

Before I get slammed, by all you inspectors who include photo’s in your reports, I will admit that using photo’s is one of the factors involved with getting higher referral rates from past home buyers. At this point in my business I get 70% of my business from realtor referrals. As the years go by, and my prices have increased, so have my past customer referrals. It may be time to start looking at a limited number of photo’s in my report and putting a little more effort into past customer marketing to increase the number of non-realtor referrals.

The “Time Is Everything – Save Time” motto seemed to work out ok for Mr. Hall and my own interpretation of the saying “Time Is Money” hasn’t hurt me any either.

by Bob on August 6, 2005

Home Inspection & Profit

Bob Kille Acuspect Home Inspection I was speaking with a fellow inspector who wanted to purchase the 3D software and home inspection data libraries when the subject of pricing a home inspection came up.

Most inspectors, in order to figure out there pricing, start calling around and asking other inspectors prices on a fictional home. They do this until they’re satisfied that they know what to charge for the common shapes and sizes. This is a very dangerous strategy for pricing your services and should be avoided at all costs.

The first thing you need to figure out is can you “afford” to be a home inspector in your area. You have to do the math. Take the number of anticipated inspections per year; multiply by the average inspection fee of your competitors for gross income. Next, add up all your fixed costs and subtract it from the calculated gross. Leave 10% for business profit. Can you live on what’s left? Don’t forget any of the fixed costs. There are at least 20 fixed costs associated with the home inspection business. If you can’t think of twenty, your going to need help to calculate your total fixed costs. It’s crucial to have an accurate number here.

To figure out your total fixed costs and projected profits along with your average hourly rate, go to: www.inspectorsuccess.com and download the “PROFIT CALCULATOR”.

If your just starting out you should figure on about 100 – 150 inspections your first year. More if you’re an exceptional marketer. Your next year should produce 200 – 250 home inspections. The average home inspector inspects approximately 250 – 350 homes a year. Can you hang on long enough to get to the numbers that generate a profit after all expenses? Do you have a reserve fund that you can draw down on? At “their” average prices are you creating any equity/savings?

There are number of items that influence the prices in your particular area especially if the market is small. In particular, the one I ran up against was a local firm that did a volume business with three inspectors and kept the prices low enough to discourage others from entering the field. It worked.

I spent about 6 months trying to get into that market place with very limited success. My prices were $50 – $75.00 higher than his because my fixed costs were higher and volume was lower. To compete with him at his pricing I would have been out of business somewhere in my second year.

Out of business, without any equity to show for all the time, trouble, and expense invested in the process. Not to mention that had I stayed employed with someone else, my bank account would never have taken the $20,000 hit to get the business started. So many inspectors out there are just hanging on because they did they’re pricing based on someone elses fixed costs. Its little wonder only one out of five new inspectors make it past year five.

Without the proper pricing structure for “your” business the work will be frenzied, inadequate, underpaid, and, as a result, unfullfilling. It’s quite possible that owning your own independently operated home inspection company is not what it was cracked up to be. In short, to start your own business without the prospect of creating equity is not a good idea. Find your true fixed costs, add them to what you need to create EQUITY in the business after your second year estimated numbers. Try it, you’ll like it.

by Bob on July 30, 2005

Home Inspection Sense

Bob Kille Acuspect Home Inspection This seems to be my week for complaint calls. Received another one on Monday, this one involves a copper-piping leak under the slab of a home built in 2000.

My client let me know straight off on the phone call that he was a homicide detective somewhere in California. This of course was to set the tone of the conversation and his position of authority. According to his lawyer’s (yes that’s plural), the homeowners insurance policy he has will not cover the claim so he is contacting me, the home inspector of record, to get information as to my insurance.

My firsts response to this was to restate that the type of inspection that he paid for was a visual inspection of the property valid only for the day of the inspection. Further, I explained that a home inspection is in no way a home warranty and assured him that even if I had E&O insurance they would not cover a NON-VISIBLE condition, even if discovered a day after the inspection.

A few half-truths here, I had occurrence insurance at the time of this particular inspection but no longer carry it. Which means that his home is still covered by my past E&O insurance policy. I now have the minimum state coverage of a $25,000 bond. I tried this tact (no insurance) because most lawyers won’t take a contingency case unless there’s deep pockets somewhere.

That leaves the complaintant with the hourly cost of retaining legal council for a case that may not be the best. Generally, if the case isn’t over $10,000 in damages and the case is not strong most of your better legal councils will tell their clients to forget it. However, if you have insurance the lawyers will make the claim and the insurance company will settle (non visible or visible condition) before legal expenses mount up.

The cost of a legal defense even in a frivolous suit can quickly become more than the actual claim. Both sides know this and this fact is why you will always pay your deductible in almost every claim, valid or not.

This particular train of thought, why a lawyer would choose not to take a case, is the basis for my asset protection strategy (no insurance, family trust, small asset list and corporate status). This complaint will make a good case study. I’m waiting with baited breath for the next phone call relating to this home inspection complaint. Will common sense win out?

by Bob on July 11, 2005

Home Inspection Payouts/Buyoffs

Bob Kille Acuspect Home Inspection Nothings ever a 100%, my business philosophy for home inspections is to pay anytime a client has a complaint whether I’m at fault or not if its under $500.00. This does three things, first it protects my referring realtor from any negative backlash and second, it allows me to immediately move on mentally instead of brooding, thirdly I won’t have negative comments being made about me. Mostly, I like to think about the payouts as a type of positive advertising in the relatively small community of realtors that I work with. This policy has gained me several realtors who actually told me the reason for choosing my company was exactly that. They heard I would take care of most anything complained about. Yes, that means I pay for things outside the scope of a home inspection. Yes, it means that I pay out if someone “feels” something should have been discovered even if covered. So I pay promptly and admit that the condition might have been discoverable or the lapse in communication was my fault. Which brings me to today’s post.

Received a call from a very distraught and upset client, I posted on his case in “Being Right” just a week ago. So, the rest of the story as Paul Harvey would say, goes like this. The realtor calls and gives me a verbal tongue lashing for giving into the customer’s demands so easily as this has emboldened the customer into thinking that he might be able to get some funds out of the other parties involved in the transaction. Namely him. The client may not be particularly rational in his demands, according to him, he “felt” as if the realtor made light of what was needed to bring the house up to his “standards”. He went on to tell me all about the “perfect” house they sold to move here. So, if I’m hearing this correctly, the reas0n the client is upset is that the house needed more work and money that what the realtor had told them to expect. This would be a somewhat valid complaint if your “standards” were perfection and quality. They basically gutted the house as nothing could be saved. This cost more than the repairs that were suggested by the realtor and my report. G0 figure. The report did list all the defects, minus one that was covered by vegetation, however the client felt that the realtors and I conspired against him in the estimates for repair. Of course I never give estimates for repair or replacement for that matter and reminded him of that at our last meeting, not that it mattered to him.

This was a 30 year old home and my client told me that I had failed to mention that the roof had been patched in the home inspection. He told me that he would not have bought the house if he had known this all important, crucial fact. Not that it leaked or anything its just that the interior ceiling patch was noticable. And this failure has caused him great pain and suffering. He actually said that. Like that would have been the reason to pull out and not the other 25 defects listed in the summary. I have since started noting in my report (not in the summary) any obvious patching to the interior ceilings and roofing materials.

So what I gather from the realtor is that the client is writing letters to the better business bureau, the board of realtors and has consulted his lawyer. I’m sort of out of this I hope, thanks to my business policy. Can’t wait till he signs the wavier and release form so there’ll be an end to this story, at least for me.

by Bob on July 5, 2005

Inspecting Nothing

Bob Kille Acuspect Home Inspection Typically in new home construction inspections you basically have 3 types of clients; the panic client, the referred client and the worried absentee client. Last weeks call was from an absentee client who has a foundation ready to be poured and she’d like to have it inspected. Get this, her biggest reason for calling me was that the builder was unresponsive to her inquires. Wouldn’t return her calls? She told me that she felt that the builder could no longer be trusted. This is exactly what happens to you if you don’t get back to a client who calls with a question or compliant. Anyway, I explain to her that the foundation inspection on a post tension slab not only has a county inspection but a special inspection by a certified post tension installer as well. That the need for a private construction inspection may well be overkill on this foundation, but if it would make her feel better about the quality of work I would gladly go to the site and document the present conditions.

The “conditions”, well lets just say I won’t be using the above reasoning of overkill. Lets see, uncompacted and loose fill at the footing in several areas, rebar less than 3 inches from the soil at several locations, dobie chairs knocked over at several locations, dead ends not secured as required (2), cables closer than 6 inches to the forms and at least 6 cables so crooked it looked like five year olds put them in place.

After submitting my report to the client she was rightfully upset and called her sales rep demanding that the issues be corrected before the foundation is poured. This is the 1st of July, 1:00pm Friday. The pour is scheduled so were told at 5:30 to 6:00am on the 5th of July. Almost no time really to get the corrections made. The next call I get is from the office of the post tension special inspector who demands to know my qualifications for doing this type of inspection. So I tell him, I’m a recognized author of reporting software that deals with the installation of post tension cables and went to the post tension institute in Phoenix, which certifies special inspectors such as himself. That seemed to tone him down a bit and we discussed the report findings. He said he’d have a look. Whatever that means.

I just got back from the re-inspection of the foundation and I can now tell you what “have a look” means. Nothing. The pour was scheduled for 5:30am; they started the pour at 4:30am, yes its still dark at 4:30am. I arrived at exactly 5:00am to do the re-inspection only to find that the garage slab was the only thing left visible. Guess what, the only two conditions at the garage left visible were still uncorrected. What do you think was corrected in the rest of the slab? Nothing is my guess. Why move the pour schedule up to 4:30am?

I’m starting to believe in this women’s intuition thing, could she be right not to trust this builder? Or is this just another communication chasm that we so frequently run into with builders who look upon private inspectors with disdain as if were the ones causing the problems. I don’t know exactly what I’m going to say to my client, she spent $$$.00 to make sure the job was done right and got “Nothing” for her money. Anyone with any thoughts about what her next course of action should be? Please leave a comment.

by Bob on June 26, 2005

An Inspectors Sour Feeling

Bob Kille Acuspect Home Inspection After my home inspection of a brand new, never been lived in house, I thought about calling the client and letting him know how things went. I don’t generally think about calling a client, but this report was gonna sour the deal to be sure. The realtor had already suggested to my client that he should use their guy to do the inspection. I guess I’ve got a reputation around here. My client thankfully liked the job I did for him last time and stuck with me.

Nine times out of ten, when you get a feeling about something you should act on it. A phone call today from my client underscores how people can interpret and blow out of proportion the comments in a report. To make things worse he acted on his fears and canceled the deal without speaking with me to sort out any concerns he had about the property.

I did this client a dis-service by not calling. I knew in the back of my head that a phone call was in order for this deal to stay in place. Frankly, this house and its conditions could have been fixed. Reports have a way of making things sound worse than they are. After our conversation, he said he had changed his mind and was willing to stay in the deal provided that the builder corrected all the conditions listed in the report, to which there were many.

Sour feelings require a pro-active stance, such as calling to explain conditions more thoroughly. Reports are short in there descriptions and much is left to an uneducated persons mind as to just how bad a condition may be. Make sure you always follow up in person on a report that gives you a sour feeling.

by Bob on April 20, 2005

Just One More Step

Bob Kille Acuspect Home Inspection An incident during my home inspection today reminded me how often many of us refuse to take that last step to success. This last step, the crucial step, always looks more daunting than it actually is. Its just one more step, just like the last few steps, with just a tad bit more of forethought and care. Instead of thinking it through or asking for a spot our minds start thinking of easier ways around that last step. But alas, that last step is there for a reason. That last step, when taken, will get you up and over obstacles without harm and see you safely to your goal.

Here’s what happened. A day just like any other day, I was up on the flat roof inspecting when I hear a muted cry for assistance back over by the parapet wall and ladder. What greeted me was my client with the proverbial “Deer in the headlights” look. He had one leg over the parapet wall and the other was two steps below on the ladder. This is an older man who wasn’t going to be able to hang on long. His face was bright red from the exertion, no telling how long he’d been in that position before crying out.

Just one more step was all that was needed to complete his goal. Try not to convince yourself that skipping a step would be easier with the same results. For most of us the last step is needed. Watch others take that last step and don’t be afraid to ask for help if your not sure of yourself the first time or two.

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