Always have any house inspected before closing

Mailbag

November 05, 1995|By MICHAEL GISRIEL

Dear Mr. Gisriel: Shortly, I'm planning to buy a house for my family. Should I get a home inspection? Also, what should a good home inspection include?

Richard Lambert

Glen Burnie

Dear Mr. Lambert: A home inspection is always a good idea.

A home inspector will inspect the home and its structural components objectively, and without emotion. The inspector should be an independent third party.

The base price for a home inspection in the Baltimore metro area is about $175. However, homes with sales prices over $175,000 are usually slightly more expensive. A good home inspection should include, but not be limited to: interior plumbing system and its components; roof, both as to structural soundness and leaks; siding; walls, ceilings and floors; foundation and basement; and built-in kitchen appliances and their components.

Many inspection companies also provide additional services, such as radon screening, septic system evaluation, water quality testing, lead paint and asbestos testing. You may find a "package" that offers various combinations of these services at a reduced price.

How do you find a good home inspection company? Often your real estate agent will suggest several names of home inspection companies with whom they are familiar or they may suggest you call as many as five or six. There are a number of questions that you should ask over the phone:

* What is the cost?

* What does the home inspection include?

* Can the company perform the inspection at a time convenient for you?

* Home inspector's background and/or training?

* Insurance. Coverage to back up their home inspection conclusions?

* Does the company issue an on-site report at the conclusion of the home inspection?

* Will the inspection company provide me with post-inspection home maintenance assistance?

Dear Mr. Gisriel: My husband and I, both in our 60s, use our vacation home in Ocean City less these days and have decided to sell it. Can we use the "over-55" capital gains tax exemption to keep any gain tax-free?

Sally Napier

Towson

Dear Ms. Napier: Unfortunately, you cannot. There are three basic requirements set out in Internal Revenue Code 121 -- that is the "over-55" tax exemption that allows older homeowners to keep up to $125,000 of their resale profits tax-free.

* The property sold must have been your primary residence for three of the past five years.

* One of you must be at least 55 years old.

* Neither of you may have ever taken this exclusion before.

It would be difficult to say that your vacation home is your "primary" residence.

You might want to consider deferring paying taxes by using an IRC 1031 tax-deferred exchange, swapping the beach house for land, a house or even a condo at another vacation location. You'd need the help of a real estate agent, lawyer or tax expert.

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