Joseph E. Rizzo, president of Tiger Home Inspections in Braintree, describes the soon-to-be-implemented home inspector licensing bill as “a major deal for our industry.”

With less than three months left until what is arguably the most significant change in recent memory for the home inspection industry goes into effect, inspectors, real estate agents and lawmakers are busy getting ready for that day to arrive.

While only about 70 days remain before the home inspector licensing bill, passed in the last legislative session, becomes officially implemented, politicians are still working on final drafts of regulations designed around the law for home inspectors. Even though final regulations may not come through until the last minute, those in the industry say they are confident the transition into a more regulated industry will be a smooth one come May 1.

“This is a major deal for our industry,” said Joseph E. Rizzo, president of Braintree-based Tiger Home Inspections, one of the largest independent home inspection companies in New England. “This is definitely the biggest change I’ve dealt with,” said Rizzo, who has been in the business for about two decades.

In 1999, a report titled “A Crack in the Foundation: Unlicensed Home Inspectors in Massachusetts” was released that detailed cases where homeowners got stuck with houses in poor condition because underqualified home inspectors failed to detect or disclose serious defects in the properties before they changed hands. Furthermore, in some cases there was no chance for recourse for some of the homeowners because the inspectors were not required to carry errors and omissions insurance.

While homeowners that suffered as a result of a shoddy home inspection could take their grievance to the courts, there was no central board they could turn to when they wanted to file a complaint.

All that will change in May.

To address concerns about the home inspection industry in Massachusetts, the law established a board of registration for home inspectors. In addition to establishing standards for the industry, the board will administer a two-tiered licensing system for inspectors and associate inspectors. Administrative costs will be partially offset by a licensing fee.

In order to get a license, potential inspectors have to attend approved training courses, and pass a licensing test, among other requirements. Established home inspectors will be grandfathered in as licensed home inspectors.

Also, inspectors will now have to carry at least $250,000 in errors and omissions insurance in order to protect their clients in the event mistakes were made in the inspection process.

“[The state] is providing for protection by requiring E&O insurance,” Rizzo said. “That’s very important. There are still inspectors out there driving around in a pickup, and if they have a claim filed against them, they just turn around and say ‘here are the keys to the pickup’ and open up as another company six months later. That’s not common, but it has happened, and that’s too bad.”

Though initially proposed to help consumers, Rizzo said the new home inspector laws should also prove to be beneficial to the industry.

“They will be making one group of standards everyone can abide by, and eliminate any confusion over how much a home inspector should do,” Rizzo said. “We’re expecting better definitions [in the regulations]. Sometimes regulations can be overzealous, but I don’t this will be the case.”

As an example, new regulations will prohibit inspectors from quoting a value for the home, which should offer some protection for home inspectors. “We’re not to quote prices, and many people expect us to do that,” Rizzo said. “Quoting a price gets us involved in negotiating the price of a home, and that’s not our job. Our job is to make sure everything will work when you move into the home.”

Back in Line
Of course, when an industry made up of mostly independent contractors is suddenly regulated, there will be those who aren’t happy about the change.

“Everyone will be put back in line because of these regulations, but some people don’t like marching to the beat of the same drummer. Some are independent,” Rizzo said. “They’re not bad inspectors; they’re just used to doing things their own way.”

The new regulations will require certain training for home inspectors, which could increase business for companies that currently offer courses, and may present opportunities for other companies to offer education as well.

Since September 2000, the state Board of Registration of Home Inspectors has hired staff members, formalized board appointments and opened the public comment period on proposed regulations. The final public comment period will take place at the board’s Feb. 28 meeting. In March, the regulations and fees will be promulgated. In March and April, the board will have applications for licensure ready, as well as the licensing exam and license database. Examinations and issuance of licenses begins in May.

State Sen. Cheryl Jacques, D-Needham, a chief sponsor of the bill, said she is excited to see progress being made by the board set up to oversee the industry.

“When there’s no oversight, anyone can call themselves a home inspector. You or I could call ourselves home inspectors and charge people $125 … Without regulation, there’s bound to be problems. That’s all going to change,” said Jacques.

Home inspectors aren’t the only ones in the real estate industry getting ready to adapt. Real estate agents will also have to adhere to regulations regarding the referral of home inspectors.

Under the new law, real estate agents cannot making any direct referrals to home inspectors to guard against conflicts of interest. Agents will now be provided a list of licensed home inspectors from the state that they may pass on to consumers. Additionally, the state Office of Consumer Affairs will be publishing brochures that educate homebuyers about inspections, and agents also will pass those out to customers.

A spokesman for the Massachusetts Association of Realtors said meeting those requirements should not be difficult for the group’s Realtor members. Many offices as a practice already hand out a list of several local inspectors that the homebuyer may choose from, he said.