Buyer's Investigation Advisory: What Every Homebuyer Needs to Know

When purchasing a home in California, one essential document you'll encounter is the Buyer's Investigation Advisory (BIA), part of the Residential Purchase Agreement (RPA). This form, provided by the California Association of REALTORS®, emphasizes that neither the seller nor the broker guarantees the physical state of the property. As a buyer, it's your responsibility to thoroughly inspect and understand all aspects of the property. The document is designed to protect you as a buyer by highlighting the importance of thoroughly investigating the property. Here’s a guide to understanding what this advisory entails and why it's crucial for your home-buying process.

Why is the Buyer's Investigation Advisory Important? The Buyer's Investigation Advisory is a crucial tool for homebuyers. It formally advises that you, as the buyer, take proactive steps to inspect and evaluate the property in detail. Unlike general physical inspections, which might not cover every aspect, the BIA emphasizes the need to delve deeper into various facets of the property to avoid unforeseen issues and additional expenses.

What Should You Investigate?

• General Condition of the Property
  Assess the property’s structure and systems, including the foundation, roof (considering its age and condition), plumbing, heating, air conditioning, electrical systems, and mechanical components. Don’t forget to check built-in appliances and any personal property included in the sale. If there’s a pool or spa, inspect it for cracks, leaks, and operational issues.

• Square Footage, Age, and Boundaries
  Verify the accuracy of the square footage, room dimensions, lot size, and the age of improvements. Keep in mind that numerical statements are approximations and might not be fully accurate. Understand that fences, hedges, and other markers might not necessarily indicate the true property boundaries.

• Wood Destroying Pests
  Investigate the presence of pests or conditions that might lead to infestations, as these can cause significant damage to the property.

• Soil Stability
  Examine soil conditions for stability issues, such as expansive or contracting soil, which can affect the property’s structural integrity. Check for any signs of slippage, settling, or movement.

• Water and Utilities
  Look into the quality and availability of water, utility systems, and any associated costs. If the property has well systems, evaluate their condition and performance. Also, understand the type, size, and condition of sewer and septic systems and the associated fees.

• Environmental Hazards
  Identify potential environmental hazards, including asbestos, lead-based paint, radon, methane, and other contaminants. This includes checking for mold and hazardous waste, which can impact your health and safety.

• Earthquakes and Flooding
  Assess the property’s susceptibility to earthquakes and flooding, especially in California where these risks are prevalent. This can affect your insurance needs and overall risk assessment.

• Insurance Considerations
  Explore the availability and cost of insurance for fire, flood, and seismic hazards. The location and condition of the property can influence your insurance requirements and costs.

• Permits and Zoning
  Verify building permits, zoning regulations, and any governmental requirements affecting the property’s current or future use. Check if any structures were built without proper permits or in violation of zoning laws.

• Rental Property Restrictions
  Understand any local restrictions on rental properties, including limits on rent, occupancy, and landlord rights. This is particularly important if you plan to rent out the property.

• Security and Safety
  Check for required safety features, such as barriers around pools and other safety measures that comply with local laws. Ensure that the property meets legal safety standards to protect occupants.

• Neighborhood and Area Conditions
  Investigate the neighborhood’s amenities, crime statistics, and any ongoing or proposed developments that might impact your living experience. This includes evaluating the availability and quality of local services, internet connectivity, and any potential nuisances or hazards.

Which Professionals Should You Engage? To thoroughly investigate the property, you should consider hiring the following professionals:

• General Home Inspector: A general home inspector will assess the overall condition of the property, including structural elements, systems, and components. They provide a comprehensive report on the condition of the home.

• Pest Control Specialist: A pest control specialist can identify the presence of wood-destroying pests or conditions that could lead to infestations. This is crucial for preventing potential damage.

• Structural Engineer: If you have concerns about the foundation or other structural elements, a structural engineer can provide a detailed assessment and recommendations.

• Plumber: A licensed plumber can inspect the plumbing systems for leaks, water pressure issues, and overall condition.

• Electrician: An electrician can evaluate the electrical systems to ensure they are up to code and functioning properly.

• HVAC Technician: An HVAC technician can inspect heating, ventilation, and air conditioning systems to ensure they are in good working order.

• Environmental Consultant: For concerns about environmental hazards like asbestos, radon, or mold, an environmental consultant can perform specialized inspections.

• Soil Engineer: A soil engineer can assess soil stability and drainage issues, which is particularly important for properties with potential soil-related concerns.

• Insurance Agent: Consult with an insurance agent to explore coverage options for fire, flood, and seismic risks based on the property’s location and condition.

Why Conduct Your Own Investigations? While brokers and sellers may provide information and referrals, they do not guarantee the accuracy or condition of the property. It is your responsibility to engage independent, qualified professionals and review their reports thoroughly. Discuss all findings with the professionals who prepared the reports to ensure you understand their implications fully.

How to Proceed? Choose qualified professionals to conduct the necessary inspections and investigations. Carefully review all reports and consult with your realtor for additional advice on which issues might need further attention or negotiation with the seller.

Final Thoughts The Buyer's Investigation Advisory is more than just a formality; it’s a critical step in ensuring that you are fully informed about the property you’re purchasing. By taking these investigative steps, you can make a well-informed decision and proceed with confidence.

If you have any questions or need assistance, schedule a consultation HERE.

Best regards,
Lindsay Woolf
CA DRE #02236711
DOMO Real Estate | CA DRE #01290500

Disclaimer: The information provided in this blog post is for general informational purposes only and does not constitute legal advice. Real estate transactions can be complex and subject to local regulations.