All Marin towns require a resale inspection when a house is sold. However, that inspection varies dramatically in terms of what is inspected and what it costs, depending on what town you are in. In some cases, it has become extremely controversial as well as costly for homeowners, especially in San Rafael.
This controversy has been brewing for several years, but really took off when our local Assemblyman, Marc Levine sold his house in San Rafael two years ago. The inspector noted a lot of work that had been done with out permits, and ordered it all removed or repaired prior to sale. All of which may seem fair, except that Levine purchased the home a few years earlier, and the City had done the same inspection, and cleared all of the work, which had been done by the prior owner. Levine spent a lot of money to clear the work prior to the sale, and in the process learned this was an issue for a number of other homeowners. A few months later at his request, San Rafael’s inspection process was audited by the State of California.
The audit was critical of San Rafael’s process and as a result, San Rafael held public hearings on the topic. The Marin Association of Realtors (MAR)strongly advocated that the program be changed to the same process used by Corte Madera and Sausalito, which charge $130 and issue a one page summary of the permit history for the home. MAR’s rationale was that homes sold in Marin County are almost always thoroughly inspected, far more thoroughly than the city does, and issues such as unpermitted work and code compliance surface then. Additionally, Sellers are required on the CAR Real Estate Transfer Discclosure Statement to disclose unpermitted work, and in our experience, usually do. In our experience the resale inspection process is often enforced in an arbitrary and inconsistent manner, and is an unecessary and redundant expense in an already expensive process.
In the process used by Corte Madera and Sausalito, it becomes the buyer’s responsibility to check what has been done on the property, and discuss discrepancies with the Seller. The most complex inspections right now are Novato and San Rafael, where an inspector walks the property, and checks for any work done without permits and highlights other issues, such as railings that are no longer to code. It is done, to some degree, at the discretion and thoroughness of the inspector, which has caused a lot of issues.
The most expensive town is Fairfax, where the cost is $350. The County does not have a resale program, nor do 90 % of the municipalities in California.
San Rafael did change the law, but made the process more open and thorough. They added a checklist that homeowners can review up front to be ready for the inspection, and they also changed the time frame for correcting unpermitted work to 180 days. This enables many Sellers to push the responsibility on to the Buyer. They also raised the price – to $295.