Relying on a standard pre-purchase inspection when buying a monolithic plaster clad home is like buying a car without a test-drive. It is impossible to know what it’s really like, and what could be wrong, without testing it properly. Except that with a house, you are gambling with your financial future and emotional health.
My name is Ian Holyoake. I have clad, inspected, monitored, pulled apart and repaired thousands of plaster clad homes over the last thirty years. I have broken the bad news to countless unsuspecting owners – that their pride and joy is leaking and decayed. Believe me, I know what I am talking about, and if you are thinking about buying a plaster clad house, you need to read this article.
You would think that twenty odd years after the leaky home scandal erupted we would have learned our lessons. Sadly no, virtually everyone buying a plaster clad house still just engages any pre-purchase inspector to check it over for problems.
However, the tools and methods used by these inspectors just can’t answer your biggest questions;
Is it decayed, is it leaking, and should I buy it?
In this article, I will explain the limitations of the tools that pre-purchase inspectors use, and the constraints that they operate under. These mean that they cannot answer these questions for you.
This is not intended to denigrate pre-purchase inspectors or their reports as they serve a valuable purpose. Many inspectors are competent professionals, doing their best for their clients . I am also not suggesting that plaster clad houses are a bad risk and you shouldn’t buy one. Many are good sound investments, able to be maintained successfully, and allow you to buy in a better area, at a lower price.
My intention is to educate you about what a pre-purchase inspection can, and can’t tell you about a house. What the limitations are. What is left out and what that means to you. I will explain how to fill in those gaps so you can buy with confidence, and provide some advise about finding a good pre-purchase inspector for that initial inspection.
This is specifically about weathertightness issues, and the damage and costs that may arise from leaks. This is the biggest concern with plaster clad buildings. A pre-purchase inspection covers many other aspects such as insulation, electrical wiring, appliances and so on. Most potential buyers of monolithic clad houses however just want to know if it is a leaker, what could be wrong with it, and whether they should buy it.
About Leaks And Decay
Before getting into details about inspections, it’s worth talking about leaks and decay in the context of buildings, particularly plaster clad homes.
All wood contains decay fungi, so has decay to some extent! I have even bought brand new timber from Bunnings, and sent it to a lab for decay analysis. They reported that it had decay consistent with having been in a leaky building and it had to be replaced!
Decay is a natural process. Home owners and buyers should not be needlessly concerned if there is some present in a house. The important information is where the decay is located, how serious it is, what caused it, and how to stop or manage it so that the home remains safe and structurally sound.
All houses will leak at some time in their lives! Some leak more than others. Some have other defences (e.g. well treated timber, ventilated cavity construction), which mean that leaks are less likely to cause damage. What is important is knowing where the leaks are, what caused them, whether they have damaged the house, and how to stop or manage them.
This is the information that potential buyers really need to guide their decision on whether to buy the house, and how much to pay.
Inexperienced inspectors are leaving house purchasers with reports that are misleading, and incomplete.
The equipment they use, such as moisture meters on ‘search or scan’ mode and thermal imaging cameras, are high performance scientific analysis tools. However they are only useful when combined with experience, knowledge of how they work, and their limitations in each situation.
Here is a real-life example that I am currently dealing with.
This first home buying couple worked out that with the current low interest rates, it was cheaper to buy than pay rent. They found a house that they both loved – one of 18 duplex houses on a single title. It was recently painted, with new carpets and the owner swore that it hadn’t been a leaker and never needed any repairs. They Googled “Building Reports” for an inspector and found an experienced ex-builder who did a ‘thorough’ inspection for them – using moisture scanning. In January (height of summer). They completed their due diligence by examining the Body Corp meeting minutes to look for any history of leaks or issues with the complex. All clear. They convinced their bank that it was a good lending risk, raised the 20% deposit and did the deal.
Then winter came along, and they noticed the paint peeling under the coving on the ground floor ceiling. This is under the deck. They Googled “Moisture Detection” and called me. I did one invasive test, drilling through the skirting board into the framing at floor level. Out came brown rot powder. 100% decayed. I tested three more locations, and all had decay. Moisture probes inserted into the test holes showed that the timber is saturated. The new owners are understandably distraught.
A quick look around the house and the complex and potential problems started to emerge – problems that the inspection report should have highlighted.
- The windows are all sealed but they leaking at the corners of the sills – these are Insulclad windows with the concealed PVC sills which open-up and leak.
- The nice new paint is disguising a large cut-out in the cladding along the deck balustrade, right above the main leak.
- The deck has been altered with overflows at the same level as the drain.
- I looked at the other 17 units. Most already have new decks, one has new window flashings and some have cavity walls where repairs have been done.
Coincidently, I examined two other properties in the complex, one in 2008 and another in 2010. Both had leaks and decay. The whole complex has a history of leaks that should be disclosed. However, neither the body corporate or their meeting minutes made mention of the obvious issues. Often this is because the owners as a group don’t want items in the minutes which put off potential buyers. The previous owner was hiding the leaks with new paint over the swollen skirting board and the cut-out. The Real Estate agent must have known as these units have been sold multiple times and word spreads when there are known leak issues.
This unfortunate couple are now faced with an apparently faultless building needing major remediation – possibly a full re-clad, or expensive litigation. All thanks largely to an inexperienced building inspector fooled by new paint, using a tool that doesn’t work well in the summer, and then not disclosing those limitations.
This is not new. I have lost count of the number of newly purchased houses, where I found significant decay and moisture issues when installing a moisture monitoring probe system for the new owner. Pre-purchase inspection tools are not able to give accurate information on the condition of a house. If only the buyers had this information before buying they could have backed out, or negotiated a price based on the actual house condition.
I have noticed a strong trend of decreasing prices for pre-purchase inspections. Where once they typically cost upwards of $800, now they are being offered at $400 or lower. That’s good right? Competition at work, keeping the prices lower for the consumer! That’s a little like going to the bargain store looking for the best brain surgeon.
The best, and most experienced inspectors will take the time to properly evaluate your potential purchase and are motivated to give a quality service rather than just push out as many reports as possible at the lowest price. The bargain inspectors have a formula, they fill their reports with pages of disclaimers to cover themselves against anything they had a duty to tell you but didn’t. Their ‘tick and flick’ approach doesn’t provide the buyer with sound advice when investing a million dollars or more
Having said that though, many inspection companies have invested in modern technology which makes writing reports faster and more efficient. This has reduced their costs so that more time can be spent inspecting, and less time writing. So how do you know?
When you Google for a pre-purchase inspector, Google doesn’t show you the best ones first. It shows that ones who are paying Google tens of thousands of dollars to be near the top of the first page, or the ones with clever (SEO) Search Engine Optimisation on their website. They may be good, or they may just be willing to spend more on advertising.
I will give you some tips later in this article about how to choose a good pre-purchase inspector, but the first tip is to never choose based on price alone.
It is helpful to understand the tools available to a typical pre-purchase inspectors carrying out non-invasive testing on a house.
An inspector has just an hour or two to make specific observations, investigate and form judgements on a building. They will use sophisticated equipment and follow a structured inspection process.
First and foremost, an inspector uses their eyes and their experience to identify potential weathertightness problems with a house.
An experienced inspector will examine the roof, gutters, decks, walls, windows, and ground lines. They will examine any part of the building that could leak, where wicking could occur and where moisture may accumulate. Examples of the most important risks to focus on are:
- Is the building located in a high wind zone – high wind pressure drives rain up and into any small crack or defect
- Are there any signs of cracks, repairs, or cut-outs
- How complex are the roof and walls – every complex detail potentially leaks
- Does the house have eaves – how wide are they and are they all around the house
- Is the roof flat or pitched
- Does the roof have true external gutters – not Taylor fascia or concealed gutters
- Is it two or more stories – higher walls are more exposed to wind and rain and there is less protection for ground floor windows
- Does it have wall to roof intersections and do these have proper flashings and stop-ends
- Does it have parapets, clad balusters or fixings through the top – and do they have sloping tops and saddle flashings
- Are there decks above living areas
- Are the decks tiled and do they have correct outlets and overflows
- Does anything penetrate deck or roof membranes
- Do the windows have flashings along the top (head flashings) and the bottom (sill flashings) , do the flashings have upturns, and are they intact
- Is the cladding well above the ground level
- Is the cladding an absorbent type (fibre cement or stucco) – these have the highest risk
Then, as they work around inside the house, they will be looking for any signs of problems – mould, decay, swelling skirting boards, musty smells, recent repairs, cracked window jams or gib, popped gib fixings. They will follow their eyes and their experience rather than a set list of items to tick off on a pre-formatted inspection report. Often, I see a change in the style of the skirting boards indicating that the walls has been opened up. The corners of the windows may have been bogged up. New carpet is a potential red flag, camouflaging decaying flooring. There are many indicators that will alert an experienced inspector that a closer look is required.
Houses constructed between 1992 and 2005 may have used undertreated or untreated timber and this is a significant risk factor that must be reported.
A prolonged dry spell or new paint is going to mask potential problems and this is also a risk.
A good inspector’s experience will direct them to use their tools effectively on each of the risks they have identified.
A good professional grade moisture meter, such as the Protimeter Surveymaster, usually has two operational modes.
The first, called resistance mode, passes an electrical current between two pins which are pushed into the timber. The drier the framing, the higher the resistance and the lower the moisture content reading. When used and interpreted correctly, these show an accurate moisture content for undecayed, untreated timber up to a moisture level of around 35% (at fibre saturation). The reading shown for decayed timber or anything other than timber, is not a true moisture content. This mode is rarely used by pre-purchase inspectors as by pushing the pins into the timber, it is categorised as invasive inspection, damages linings and is outside the scope of a visual only inspection.
The second, is scanning or search mode, where the meter uses capacitance to measure the density of the material directly under the device. The signal only penetrates about 20mm into the surface. Wet timber, gib, fibre cement and plaster is denser than dry material, so the meter signals higher. Comparing the readings at known dry locations with suspect areas of the same material gives a good indication of the relative dampness. The scan mode has limitations which I find few inspectors understand and leads to incorrect pre-purchase reports.
Scanning or search mode cannot and does not provide an actual moisture content, however many pre-purchase inspectors report the results as if they were factual and correct. If the meter reads over 18% then they report this figure and classify it as a high reading. This is not a correct use of the moisture meter. All meter readings must be considered in context. For example, on search mode, if the gib under one end of a window scans 10% but the other end scans at 17%, then this could indicate a leak, however if both are scanning at 20%, that just could be the baseline density reading of the gib in that part of the house.
The inspector must understand how the meter works and what it is showing, within the context of the house being inspected. Otherwise, they risk missing actual leaks and wrongly reporting good areas as having high moisture.
In the case I talked about previously, the buyer asked the inspector specifically to check an area he was concerned about. The inspector scanned this and said incorrectly said that there were no problems. However, this was in the summer, the leak had dried out and as the timber was decayed, it was less dense than good timber and was reported as dry, i.e. acceptable condition. Because it was concealed within the wall, the inspector couldn’t determine its real condition. In winter, the leak re-appeared and when invasively tested was found to have caused serious structural damage. A double miss and a disaster for the buyers.
During the height of the leaky homes crisis, the government set up the Weathertight Homes Resolution Service (WHRS) to help leaky homeowners get compensation to fix their houses. The WHRS had a group of Assessors, who would go from house to house to assess the defects, the damage and the repair costs. The WHRS Assessors were specifically instructed that non-invasive readings taken in search mode were not evidence and should not be recorded. However, that is exactly what is happening today. Pre-Purchase Inspectors are using meters in search mode, recording the results and suggesting that they are actual moisture percentages. Totally missing actual decay and winter leaks In this case both the bank and purchaser have been mislead.
So, are these meters any use? Most certainly. In search mode, they are invaluable for searching for areas of higher density timber, gib and plaster, which are often associated with a leak. These meters can assist in understanding whether a certain feature (flashing, window etc) is leaking, highlighting them as risks to be quantified by future invasive testing. In summer more invasive testing would be recommended.
During invasive testing, when framing is exposed (in drill holes or cut-outs), moisture meters used correctly in resistance mode, accurately measure the moisture content of timber. Whilst the meter can’t detect decay, wood samples taken during the invasive testing will show the condition of the framing.
The experienced inspector always knows the limitations of his meter on each house and will recommend further invasive testing to verify any suspicious findings.
Some pre-purchase inspectors carry a thermal imaging camera. An independent thermographer may be also suggested for further weathertightness investigation.
Modern thermal imaging cameras are incredibly accurate, creating stunning pictures showing the minute variations in temperature within a wall. The theory being that areas which are moist will be cooler and will show up as different colours. However, temperature changes can be caused by a number of factors such as thermal bridging, gaps in the insulation, air flow, changes in materials, sun on the external surfaces, internal condensation, and of course leaks.
A good thermographer understands all of this but most importantly they first understand the construction and risk factors of a building. They know how these relate to the thermal images on the screen, and what the consequences of any leaks could be. They will be aware of the era where timber may be untreated, that there may be no cavities in the walls and flashing details may have been missed or are deeply concealed with plaster. They will have a strong grasp of the technical limitations of the equipment and avoid using it in the rain, in wind or on a hot day. They will make sure the buyer is aware that thermal imaging in these conditions, or in the middle of summer is likely to give false results, must not be relied on, and that invasive testing should follow.
I have been appalled at the lack of basic weathertightness knowledge displayed in some thermal imaging reports. Weathertightness 101 is that moisture follows gravity, tracking down from the leak points and accumulating in the bottom plate. I have seen several reports with nice thermal images taken around the ceiling/wall junctions showing how dry the house is. At floor level I then find moisture and decay. These reports are not fit for purpose because they lure buyers into paying too much or buying houses they shouldn’t have bought.
The WHRS agreed with this, instructing its Assessors that thermal images cannot be used as evidence of leaks as the images are arguable and colour changes can result from factors other than leaks.
Thermal imaging has its place but having reviewed many reports and then carried out follow up invasive testing, I see a lot of leaks and decay that they miss, and many areas reported as potential problems where there is nothing wrong. This is not a problem with the technology but in the lack of skills and understanding of the operator who does not recognise the limitations of their equipment.
NZS 4306:2005 Residential Inspection Standard provides a minimum standard for a pre-purchase inspection. Following a checklist of items, assists an inspector to make a complete inspection of all of the specified items, within the limitations of a ‘visual only’ inspection.
An inexperienced inspector may be following this to the letter, allowing the Inspection Standard, rather than observation and experience to guide them around the house.
Pre-purchase inspections are an important part of the due diligence that everyone should carry out before buying a house.
We are most concerned about houses with monolithic claddings, built during 1992 to 2005, although even weatherboard and brick houses from that era are not immune from issues arising from leaks. The problems are just taking longer to show up, but these will no doubt feature more and more in the future.
Over this period, the timber framing treatment was reduced then taken away altogether. Monolithic claddings were widely used, fixed directly to the framing with no drainage or ventilation to manage moisture. House designs were permitted without the traditional weathertightness defences such as eaves, and effective flashings. The processes around issuing building consents, inspections and issuing Certificates of Code Compliance were deeply flawed and thousands of houses with major defects were passed as compliant.
Without treated framing, without cavities to drain and dry, with a proliferation of poor flashings, and with councils’ deficient compliance and inspection regime, the result was the leaky building crisis. The owners of these houses, with defects which can cause leaks and decay at any time, are now responsible for their repair and maintenance.
This is well-known and all monolithic clad houses now have stigma and get lumped into the ‘high-risk’ category until proven otherwise.
The pre-purchase inspector, carrying out a standard visual only inspection on a monolithic clad house to the NZ Residential Property Inspection Standard, has a challenging task. The visual-only inspection, cannot inform the inspector of the condition of the house. Because they cannot inform you with certainty, they use six pages of disclaimers about what they can’t find and can’t report on. They are protecting their uncertainty but leaving you uninformed. Past court cases have proven that they can’t fully dodge their legal liability, however you are the one left with the problem. If the house has leaks and decay, then this will come out and you are now stuck with it.
Most pre-purchase inspection reports quote compliance to this standard. Many banks also require this before lending money.
New Zealand Standards are put in place to provide a minimum level of consumer protection. In the case of NZS 4306:2005, the minimum level concerning important aspects such as weathertightness is very minimum indeed.
It seems that the intention of inspecting houses has been lost amidst the desire for conformity and protection against liability. Most pre-purchase inspection reports talk far more about what the inspection doesn’t report and what the inspector can’t be held liable for, than the actual condition of the house. The inspector is not even supposed to move things out of the way to inspect properly anymore! So, the vendor can put something in front of some damaged skirting, and the inspector isn’t allowed to see it. Crazy situation! Who’s interests is this looking after?
NZS 4306:2005 Sections 1 through 3 covers ‘visual only’ inspections where the inspector completes a report in the form prescribed by the Standard.
NZS 4306 Section 4 ‘special purpose reports’ covers special inspections, such as weathertightness. However the standard gives very little guidance on the process to be used or the outcomes that would be reasonably expected. Some of the techniques used are highly destructive, requiring cutting out cladding or gib, making it unrealistic for a seller to accept such damage. This means that invasive investigations become limited or non-existent.
A pre-purchase inspection is of value if it:
- identifies the problems that are visible and,
- identifies the actual leak risk features of the house that might cost you money and the consequences (costs and damage), if those features do leak and,
- provides actionable recommendations for how to find out if those features have leaked and caused damage and,
- clearly explains the limitations of the inspection tools and techniques in the context of this particular house and inspection carried out.
As a buyer, you really only want one question answered – ‘should I buy this house?”. The report must either answer this question or direct you how to find additional information that will answer it. However, if you are looking at a plaster clad house, the report must direct you to carry out invasive testing, otherwise it is defective.
I have seen inspection reports that run to 70 plus pages, but no mention of the obvious weathertightness risks on that house. Lots of pretty thermal images of areas that would never show leaks anyway. No recommendations to get invasive testing to determine the accuracy of the images or scanner readings. Even to the highest risk features of the house! Nothing. And no discussion about the consequences if the house leaks or if the timber isn’t treated.
An impressive looking report can be very dangerous. These are the ones that can mislead the buyer into thinking that the house must be good.
A suitable pre-purchase inspector is one who has the following attributes:
- Has a strong background in building construction so they understand how houses are put together, where they may fail, and the consequences of failure,
- Has understanding and experience of the typical defects that can lead to decay and damage especially in ‘leaky home’ era buildings,
- Uses modern tools (good quality moisture meter), and understands their limitations,
- Knows what visual inspection can and can’t achieve, what may be missed and is comfortable directing clients to seek out more information and testing, such as invasive testing, when appropriate.
- Provides clear, direct communication with the minimum appropriate disclaimers
The Real Estate agent selling the house may recommend one however remember that they have a vested interest in selling the house. This means they may be inclined to recommend inspectors who are less observant and more lenient, so more sales go through.
As mentioned earlier, a high position on the first Google page is more a reflection of how much money the inspection company pays Google and their IT advisors than the experience or proficiency of the inspectors.
However, once you have found one or more that you like the look of, who can demonstrate that they possess the attributesabove, it’s time to vet them to see if they come up to scratch.
Ask for copies of two reports that the actual inspector has completed recently on similar aged and designed houses (they should remove anything identifying the house).
The report should:
- Identify the cladding material and whether this is cavity or direct-fixed construction.
- Provide a schedule of the ‘weathertightness risks’ of the building. If this is missing, then go no further.
- Provide a commentary on the consequences of those risks, e.g., if the window has been leaking, and the framing is untreated, the consequence is that the framing under the window, the bottom plate and even the boundary joist may be decayed. If the framing is treated, there may still be some damage, but the risk is lower.
- Provide information on how the purchaser can quantify, or eliminate these risks, e.g., by having the treatment levels in the timber tested, and by invasive testing for moisture and decay.
- Provide general information on weathertightness risks associated with this style and era of building.
- Provide information on the diagnostic tools used, and their limitations especially in relation to the house and conditions, e.g., thermography and scanning in the summer will miss critical defects and neither can detect decay.
- Have less than a page for disclaimers about what the report can’t and doesn’t show, and what the inspector is not liable for.
- If this is a monolithic clad building from the leaky home era, without cavities and the report does not require invasive testing, why not? A visual-only inspection cannot give the buyer confidence that the building is sound.
A pre-purchase inspection carried out using the visual inspection standards in NZS 4306:2005 cannot give buyers of monolithic clad homes the information or certainty they need about the house condition.
A monolithic clad house can have multiple expensive hidden defects that cannot be found with visual or non-invasive inspections, however;
- The seller wont agree to having the house ripped apart doing destructive invasive testing but,
- The buyers need sufficient information to be sure that they aren’t buying someone else’s problems and,
- Their bank needs to know that the house is an acceptable risk and,
- The pre-purchase inspector needs to go in, inspect quickly, and punch out a report satisfying the client, and covering the inspector from legal action.
The only answer to this dilemma is having a method of invasively testing the timber for treatment, moisture levels and decay levels inside the walls of houses without causing any damage, then;
- The seller can’t argue with reasonable requests for invasive testing – if they do, then what are they afraid of or trying to hide?
- The buyer has accurate information on past and current performance of any part of the house with weathertightness risks
- The inspector is covered because they can recommend invasive testing at every potential risk point, which is always going to be best practice. They can do away with the pages of exclusions and qualifications.
Sadly, there is no miracle method of doing invasive testing with absolutely no damage to the house, but small discrete moisture probes are the next best thing. Each weathertightness risk location can be invasively tested, the actual moisture level in the framing measured, the timber inspected for decay and the treatment levels tested. This is very cost effective and has minimal impact on the house – the probes are usually left in place in the skirting boards, with just the cap (looks like a shirt button), visible. Those probes then function as a permanent moisture monitoring system. They can be removed and the holes filled and painted over but why? The next buyer will want the same surety as you are seeking now, so leave them in and build up a record to prove your house condition.
I invented and patented the Mdu moisture probes back in 2005, and have installed them in thousands of homes since then. I can go back and read the probes regularly to monitor for any new leaks.
The results from moisture probes were accepted as evidence by the WHRS and have been used in multiple court cases and Determinations.
At some point in the future, potential buyers of monolithic clad homes must refuse to buy unless the house is fully probed, because anything less means unacceptable risk.
Sadly for my couple above they only got to probe the house after they had purchased.