What I'm Seeing Now

A long, long time ago, in a galaxy far, far away, in a marketing class at MBA school, I learned a principle that has stuck with me:

The Slight Edge Principle.

It is simple and a marketing idea that needs to be employed.

This is it:  try to make yourself slightly better than the next competitor.  It doesn't matter if you are a real estate agent, loan officer, home inspector, whatever.  Just slightly better.  How do you do that?  There are many ways.  You offer a product - you.  How do you differentiate that product from the pack?  Services?  Certifications?  Continuing education?  Experience?  Website?  Blog?  Whatever it is.  Is it slightly more or better than the competition?  Does it set you apart?  Do you market it?

Consider this slight edge:  In 2007 the number one golfer, in terms of average score, for the year, for 18 holes, was Tiger Woods.  His average score was 69.1.  Pretty good!  The number 51 golfer for the year, for 18 holes, had an average score of 70.9.  His name is Tim Clark.  He was only 1.8 strokes, per game, different!  Number 100 was Craig Bowden, with an average score of 71.2 - just 1/3rd of 1 stroke more than Mr. Clark!!

How many of you have heard of Tiger Woods?  How many have heard of Tim Clark?  Or Craig Bowden?

This is NOT to slight Mr. Clark, or anyone - he is only 1.8 strokes, per 18 holes, in the long run, different than Tiger Woods!  Yet he is 50 positions away!!  Imagine!  That is only 1/10th stroke different, in the long run, per hole.  Tiger Woods has a slight edge, but look at the final results!

How is Tiger Woods different?  Ability?  Practice?  Attitude?  Determination?  Self study?  Coaching?  All of those things?  How much more money did Tiger Woods make in 2007 than Tim Clark or Craig Bowden?  And from what sources - golf, endorsements, TV commercials, print ads, etc?  Yet, he is, in reality, only slightly better than the rest of the pack.  He offers a different, more marketable product...

How can you make yourself slightly better than your competition?  One more sales call per day is over 350 a year.  Ten a week is over 500 per year.  How much more business would those calls bring in?  One more open house would result in how many more buyers?  One more of this per week, or that per month, would result in how much more business?  Do you speak another language?  Or stage your homes?  Or have more resources?  Belong to more groups?  Do more networking?  Use more tools and testers?  And how would these small things set your services, your product, apart from the rest of your competition?

I am always trying to do something more or different than my competition.  On days that are not completely full of inspections, I am doing something slightly more in terms of marketing, or whatever, to fill them up.  And in this somewhat "down" market, I am fairly busy.  Really, the fittest survive.  Or those slightly fitter...

If you don't think marketing is important, there are 20 mountains in North America higher than Pike's Peak - how many can you name?

Now, if only I could make my blog header slightly better...

This is the final entry for Buyer Red Flags.  Of course, the list could probably go on.  But these three lists together are short enough that if you wanted to keep an index card in your pocket while walking through the house you could!  Most you already have on the tops of your head anyway.  You remember what a Red Flag is:

A Red Flag is any visual sign or indication of a defect in structure or property. Certain visual signs may or may not indicate a problem.  If observed in multiple numbers, especially in the same approximate locations, many indicators can point to a Red Flag condition.  A rule of thumb - the newer the property, the redder the flag!

• Cracks in the slab or foundation larger than 1/8".  This greatly depends on the age of the house.  An older house with such cracking may not be a problem.  On one inspection there was an unfinished basement floor with a 1/4" crack, perfectly straight, which ran wall-to-wall, the length of the basement, about 45 feet!  I had never seen such a thing and called an engineer friend.  His answer was that it is normal cracking.  Normal I thought?!  "The basement floor is a slab," he said, "usually without expansion joints.  If it needs to crack it will."  Well, it did...
• Boxes piled against the foundation wall, especially if only in one area.  The courts call that "artfully concealing" a known defect.  It has happened to me!  Once, a lot of boxes were piled against one concrete block wall, but only to a particular height.  When my clients moved in the boxes were gone, to reveal a long, horizontal crack.  The sellers said that we had our opportunity to do an inspection and that I should have caught it then.  Hmmm...  I found many items of minutia but just happened to miss a large foundation crack!  We all remembered the boxes.  My clients petitioned for, and got reimbursed, the costs of repairing the "artfully concealed" crack.
• Synthetic stucco.  Especially the older stuff, without the drainage system used with stucco today.  Look especially for stucco that is deteriorating near windows, bubbling or has lifted creases like a crumpled shirt.
• The seller is present and diverts your attention.  Once, during an inspection, the seller decided that that particular afternoon was the perfect time to clean an oven.  The process took up the entire inspection. It turns out the oven did not work.
• Strange things goings on!!  A huge, spongy puddle in the back yard.  Incense in one part of the basement.  A "sleeping" tenant in one locked bedroom.  Once we saw a BIG stump in the back yard with recent, large shavings all around it.  In the basement there were V-shaped cracks in the foundation walls at the same point of the house front and rear.  The two center rooms above had new carpet.  In the attic I finally noticed an entirely new roof structure in the middle third of the house, above the cracks and carpet.  Conclusion - said stump was from a tree, which had fallen on the house!  The kicker -- the seller was a real estate agent, who showed up with HOA paper work.  When I asked her about my diagnosis (NOT rocket science!!) she said, no kidding, she said, "Oh, yeah, I forgot to tell you about that.  I was going to let the buyers know..."  Oooookay!  

My recommendation - make your own list.  What things do you commonly see in your area?  Rely on your experience - you have a lot of it.  You know when things don't feel right or look right.  Suggest to your clients that they look for same!

This is the second post of some things to look for the first time you walk through a property with a client.  You will want to be even more scrutinizing if this is subsequent to the first visit and the client is serious about making an offer.  These are Red Flags that can be added to your list:

• Old windows and storms.  There is a reason window replacement is such a big business and one of the most common remodels on an older home.  Older windows are obviously less efficient, more drafty and energy wasters.  Plus, many don't work properly!  Often people sell houses before they absolutely have to do repairs or replacements.
• One repainted wall or ceiling.  This is a Red Flag.  Why would one wall be repainted?  It might be that the color used to be furniture friendly or a design-specific accent color.  But, often not - it's a cover up!  The same with ceilings.  During an inspection I will examine all ceilings with a flashlight laid horizontally along the ceiling looking for recent drywall repairs.  It is not out of line to ask the seller a question about a recent paint job.
• Wet basement drain.  Most homes have some form of basement floor drain.  They can clog.  What's in there - frog, muck, paint?  A continually wet condition can promote unfavorable health conditions - molds, bacterias, etc.  Always a Red Flag, it pays to look.
• Two layers of shingles.  This is a common option when wanting to sell a house.  It is cheaper and quicker.  It is often difficult to see.  Is it a quick cover up?  Red flag!  A clever roofer will hide the second-layer fact by removing the bottom course or side shingles.  A give away would be new shingles and an old plumbing penetration sleeve!  Or funky flashing.  A second layer of shingles will not get the same life span that a single layer will.  It appears to your buyer that he is getting a new roof, and he is not!
• Large, unsealed gaps.  These could be in the drywall or foundation walls.  Why wouldn't the seller seal them up?  Or, has a repair already been done and it opened up again?  Look for previous repairs.  Large gaps indicate movement.  From what source?

My recommendation:   Keep your eyes peeled.  Look around and ask questions.  It adds to your professionalism and value in the eyes of your client to be forthcoming with questions or observations.  Be a team - many eyes are better than two.  On inspections I say to my clients - "We are a team now.  Let me know what you see!"

You probably aren't a professional home inspector.  But realty agents, buyers and investors should always be critically looking at houses before any final decisions are made and an offer extended.  They have to.  Can I suggest that during these "inspections" you employ some common sense?

Here are some things realtors and buyers can do before they hire a home inspector to look at the home someone wants to buy.  They are not listed in any particular order, but any or all could be important during your house search.  I am going to list many Red Flags in three different blog posts that could indicate house  distress.

What is a Red Flag?  It is any visual sign or indication of a defect in structure or property.  Certain visual signs may or may not indicate a problem.  If observed in multiple numbers, especially in the same approximate locations, many indicators can point to a Red Flag condition.  A rule of thumb - the newer the property, the redder the flag!

These Red Flags won't be listed in any particular order, but any or all could be important during the house search. Some defects may be small but many of them add up. Others could be expensive to repair.  The first few are as follows:

• Brown stains on ceilings and walls.  You would think that a seller would repair, prime and paint such things, but many don't.  A brown stain is mostly indicative of leaks.  When?  Don't be afraid to ask the history of such things.  If the seller says they don't know, that is a Red Flag!
• Brown stains on foundation walls.  The same applies here as was said above.  On a foundation wall, such stains indicate ongoing moisture.
• Warped hardwood floors - especially near exterior doors.  This also indicates water.  Warping is not repairable.  The flooring must be replaced, AFTER the problem is solved.
• A moldy smell.  Your nose is your best mold detector.  Employ it!  Mold is not the original problem - it is a symptom of moisture.  Look around, see if you can tell where the wet is coming from.
• Poor grading.  Water is THE killer of houses, inside and out.  Houses don't make very effective boats.  Exterior water should not be encouraged to surround the foundation.  Look for grading, downspouts or landscaping that encourages water away from the house, especially if the front or back yards slope toward the house.
• Chipping paint around windows.  Sound small?  It might not be, especially if it is happening on lots of windows.  Water is getting into the wood.  Why?  Poor product or installation?  Amateur work?  How far has the water gone?  Has it progressed into the house structure?  Amateur work here could mean amateur work there...

My recommendation:  make a list.  Ask questions of the seller, if possible.  Be proactive.  Call somebody.  Many realtors call me from houses when they have questions, on the spot!  I encourage that and cheerfully provide answers if I can.  (A Scout is cheerful, so the Scoutmaster BETTER be...)  My realtor and investor clients use me as their consultant in their pockets.  Feel free to call too!

We learn from history that we learn nothing from history.

The eight (8) most economically prosperous countries in the world are those that most closely follow Adam Smith's economic model (The Wealth of Nations, circa 1776).  The eighty (80!) or so least economically prosperous are those that are the furthest from that model.  We have just voted a president, who, combined with a Congress so in lock step, has promised "fundamental change."  That fundamental change is intended, yes intended, to take us further from Dr. Smith's 8 and more toward the 80.  Pure and simple.  THAT is what "spread the wealth around" means.  Just two days ago, a congressman from Virginia, Jim Moran, said that it is about time that we disabuse "the simplistic Republican notion that those who have wealth should get to keep it."  That is VERY close to a direct quote.

Yes, he said that...  The word "wow" comes to mind...  So if I spend my lifetime building a stamp collection, or numismatic coin collection, or antique furniture collection, bank account, IRA, business, or any such so-called wealth, it is time to disabuse me of the notion that I should get to keep it?

The last time this country elected a socialist, redistributionist president who promised "change" (Mr. Carter), it got what it wanted - change.  Boy, did it get change!  This socialist, redistributionist, economic mentality has never worked at any time, in any place.

But this time, yes this time, it will be different.  If on nothing else then certainly on the many demonstrated, past  successes and diverse, lush résumé of our new president, this time, it will work!  HE will make it work!  "Yes [he] can!"

I am to believe that this time, finally, socialism and appeasement will work!

We learn from history that we learn nothing from history.

This is the last of my posts regarding new construction inspections.  It is the sixth of six things that I am finding often in new construction, pre-drywall inspections.  This list of six certainly does not represent all of what I am finding in new homes, but they are very common.  This is another one of those construction mistakes that may not manifest for some time, but will be a big problem once it does.

It is this - plastic plumbing support!

Much new construction now utilizes CPVC for supply piping and almost all use PVC for drain, waste and vent lines.  Often they are not supported well.  Plastic is not as strong or as firm as copper.  It needs different support. 

1. CPVC supply tubing is often run horizontally.  That is fine.  But the support used is typically a nail with a rounded, plastic holder surrounding the pipe.  Often they nail it too hard and it cracks.  More often the nail is on the upper side and if that holder cracks and breaks there is no underneath support for the horizontal pipe.  Then it sags.  If it sags near a joint it is vulnerable to breaking.  If it sags too much it is vulnerable too.  This is pressurized water, so small leaks quickly become big breaks which leak furiously.
   
2. Plumbing vent stacks which pass through the roof.  They do that to take advantage of atmospheric pressure to encourage gases to leave the house.  This also expels otherwise noxious, toxic gases into higher air.  These are often supported in the attic space with a small nylon or plastic strap.  These can move over time.  Or stretch.  Or break.  When they do the vertical tubing sags, becomes too short or actually passes through the roof and into the attic space.  Sewer gas is then being expelled into the house!  Yummie, I know.  I see it all the time on one-year inspections.  One day I was on the highway and saw a house in the distance that had both plumbing vents missing from the rubber sleeves still on the roof.  They had both sagged back into the house!  I did not have time to go to an exit, make my way to the neighborhood and try to find that house.  I would have if I could have!
3. Often AC units are in the attic space.  They are sitting above drain pans.  In proper construction there are two condensate drain lines - the one tied directly into the unit (primary) and another tied to the drain pan (auxiliary).  This tubing tied to the drain pan is of great interest.  It works off of gravity and typically drains out the side or rear of the house.  If you see it dripping, it means that the primary line has clogged and needs cleaning.  BUT, it should incline gently and consistently to that exterior drain.  Often it is not inclined or sags dramatically from lack of support.  In that case, gravity cannot take over, the pan fills with water and the water leaks into the house.  An upper-level AC unit can remove 8 - 10 gallons of water a day from the air.  That water represents a huge leak into your ceiling and does a lot of damage.

All of these things are easily seen on a pre-drywall inspection.  They are often hidden after and hard, if not impossible, to detect.

My recommendation -   always suggest to your clients a pre-drywall inspection when the opportunity presents itself.  Done properly, the money spent is valuable money spent, especially in the long run.

I am very proud for one of "my" boys!  Tonight I had the opportunity to see another young man become an Eagle Scout.  Tonight's event was for David S.  I am always impressed with the humble simplicity of the event.  It represents the culmination of many years of effort, and learning, and discipline, and encouragement.  I am always impressed.  With all the turmoil experienced by youth today, it is a blessing to me to be able to witness another one who is less influenced by the ever-increasing pap and emptiness that some of today's youth think is important.  Many young people would consider what David has done to be useless pap and empty!  They have no idea!

Since the first Eagle Scout in 1912, almost 2 million have achieved the rank.  Only about 5% of all Boys Scouts achieve Eagle Scout.  It is quite an accomplishment.  Some of what they need to do is required, and some elective.  But all with the goal of creating a well-rounded, circumspect, dignified young man.  Robert Baden-Powell intended that to be the case, and had Luke 2: 52 as his model.  What a legacy Baden-Powell has wrought!

David is one of "my" boys, for many years now.  I have been involved with Scouting in one way or another for 47 years.  Currently I am a Venturer Coach (the older boys) and merit badge counselor (13 I think).  As leaders, we have had many, many boys reach the Eagle rank.  We think of each of them as "our" boys.  I think about them individually and collectively every day.  Sure it takes time.  But it is time well spent, very well spent.  I do not mind.  It rubs off and makes me better too!

Boiled down Scouting represents service.  It is a program that gives - it gives to those who participate and to society in general.  Some like to say that it is important that we all "give back."  I SO disagree.  We all need to give.  It is the cheats, thieves, rapists, murderers, scammers and selfish, mean, societal scum who need to give back.  Until it hurts.  Had they spent more time "doing a good turn daily" than trying to take something that wasn't theirs to take, their lives may have turned out differently.  We pay the price for their courses of action.  Eagle Scouts, on the other hand, give us a great deal.

At each Eagle ceremony I attend, I always make it a point to say to the recipient that he doesn't yet realize what this will mean to him in life.  This accomplishment will follow him all of his days.  I tell him not to be shy to put on a resume or job application that he is an Eagle Scout.  Think about it!  What employer would not want to hire someone who has striven to be trustworthy, loyal, helpful, friendly, courteous, kind, obedient, cheerful, thrifty, brave, clean and reverent?

I am very proud for one of "my" boys...