Cost-Benefit Criterion
It’s not just medicine where there are now more — and more expensive — diagnostic tests.
Home inspections increasingly include multiple, specialized tests as well.
Besides the standard, whole home inspection for around $400, these three tests seem to be popping up more regularly in today’s housing market:
One. Radon. An odorless gas released by soil decomposition, radon represents a health threat at elevated levels. In Minnesota, the threshold for remediation is 4.0 PicoLiters per million parts. Cost: about $175. Remediation (if needed): $1,200 to $1,400.
See also, “Testing for Radon 2013“; “Testing for Radon: Cost-Benefit Analysis;” “Recommending a Radon Test (or Not).”
Two. Furnace or boiler. When the Buyer’s home inspector suspects an issue with the heat exchanger or other components, the usual next step is to bring in a licensed HVAC contractor to certify that the unit is operating safely. Cost: $200. Replacement: $3,500 to $5,000.
Post-closing, a passing grade from a licensed contractor serves another purpose: it slams the door on a home warranty company arguing that any furnace issue was a pre-existing condition, and therefore not covered (an increasing % of home sales now include such policies).
Three. Sewer optical inspection. Basically, a “colonoscopy” for the home’s connection to the main sewer. The contractor literally runs a camera through the sewer, looking for cracks. Cost: $200. Repair: $5,000 to $10,000 in the city — more in rural areas where the main sewer connection is further from the home. See, “What’s That Depression in the Yard?”
Situation-Specific
In addition to the above, there are additional tests that are home-specific.
So, many Buyers of stucco homes built in the last 20 years elect to test the home’s wall cavities for elevated moisture levels.
The usual concern is that the home’s vapor barrier has been installed incorrectly, capturing moisture in the home’s wall cavities where it incubates mold and slowly rots the home’s (wood) frame.
Cost to repair/remediate?
A LOT — not the least of which is for attorney’s fees incurred in the inevitable litigation.
Finally, when the home’s chimney or flue shows deterioration, running a camera through it can verify the existence and scope of the problem(s).
Cost-Benefit Analysis
In each case, the rationale for recommending a test (or not) should be a simple cost-benefit criterion.
That is, does the risk of finding (and correcting) a problem exceed the cost of the test?
Radon tests — to pick just one example — easily pass that test.
So, if the odds of finding elevated radon range from one-third to one-half (my clients’ experience), and remediation costs $1,400, the “benefit” is about $600.
That far exceeds the usual $175 cost.
One other consideration: unlike medical tests, which can pose their own health risks (like radiation), testing a home (usually) has no adverse side effects.
P.S.: Even though lead-based paint is presumably in every home built before 1978 (when it was discontinued), I’ve never seen a homeowner test to verify that.
Instead, the standard way of disclosing that fact to prospective Buyers is to tell them that, to the best of the homeowner’s knowledge, the home does not have lead-based paint in it.
