What a home inspection covers and misses when you buy in Ontario

The short answer

A home inspection in Ontario is a look at the condition of a house or condo by a person trained to spot problems. The Ontario government describes it as an on-site, in-person examination of a home’s condition and structure. It is a visual inspection of major elements and systems, like the foundation, the electrical and plumbing systems, the attic ventilation and the roof.

It is also limited. An inspection tells you what can be seen on the day. It is not a guarantee and it is not a test that a home passes or fails.

This guide explains what the inspector covers, what the government and the Real Estate Council of Ontario (RECO) say it cannot do and how to make the most of it when you buy in Markham or anywhere else in Ontario.

What does a home inspection cover?

According to the Ontario government, inspectors typically examine these parts of a home:

• Foundation and structural integrity
• Roof and exterior walls
• Doors and windows
• Attic and ventilation systems
• Plumbing and electrical systems
• Heating and air conditioning systems
• Ceilings, walls and floors
• Insulation
• Drainage
• Common areas, when you are buying a condominium

RECO gives a similar list and adds septic systems. CMHC says an inspector performs an inspection of the visible components of the home and tells you the condition of the house, what is working properly, what needs to be changed, what is unsafe and what repairs need to be made.

The word that matters in all three descriptions is visible. The inspector reports on what the inspector can reach and see.

What does a home inspection miss?

The Ontario government is direct about the limits. It says an inspector cannot see or find everything. Its examples are that an inspector may not find mould and may not be able to inspect a roof that is covered with snow.

It adds two more points you should hold onto:

1. A home inspection is not a pass or fail test.
2. It does not assess whether a home meets zoning or building codes.

The same page says an inspector does not provide warranties or guarantees on a home’s condition. In other words, the report is a snapshot of condition and not a promise about the future.

RECO makes a related point about information from the seller. It says a Seller Property Information Statement reflects only the seller’s personal knowledge and may not reveal defects the seller does not know about. An agent may spot obvious problems, but RECO notes that underlying problems can exist that nobody can see.

A quick reference

Question	What the sources say
Is it a pass or fail test?	No (Ontario.ca)
Does it check building code or zoning?	No (Ontario.ca)
Can the inspector see everything?	No, for example mould or a snow covered roof (Ontario.ca)
Does the inspector guarantee the home?	No warranties or guarantees (Ontario.ca)
Does it cover the major systems?	Yes, electrical, roofing, plumbing, heating and air conditioning, foundation and septic (RECO)

Are home inspectors regulated in Ontario?

Not in the way many buyers assume. The Ontario government states that at this time Ontario does not have mandatory requirements for home inspectors. RECO says it does not regulate home inspectors either. RECO regulates real estate agents and brokerages. It points buyers to your agent or the Ontario government for information about inspectors and their services.

The Ontario page also says inspectors are currently not required by law to have insurance coverage, though many do have policies. CMHC notes an inspector usually belongs to a provincial or industry association.

Because there is no mandatory requirement, the choice of inspector is yours to check. The Ontario government suggests looking for an inspector who:

• Provides written inspection reports
• Will give you references
• Has experience with the type of home you are considering
• Holds an accreditation that shows training and experience
• Provides a written contract

How does an inspection fit into your offer?

RECO calls a home inspection one of the most common conditions in an offer to purchase. A condition makes the deal depend on something, in this case a satisfactory inspection, within a set time. If the condition is not met, your options depend on how the offer was written.

CMHC says you may want to make the inspection a condition of your offer so that you know the condition of the house before you agree to buy. It adds that if the report identifies repairs, you and your agent will need to talk about whether the condition of the home warrants withdrawing your offer or how the repairs might affect the price you are offering.

The wording of the condition, the number of days and what happens if the report disappoints you are legal questions about your own agreement. Your agent and your real estate lawyer should review them with you before you sign.

Should you waive the inspection?

When several buyers compete for one home it can be tempting to remove conditions. RECO says to think twice before waiving a home inspection and warns against skipping it even in a competitive market. We agree that this is a decision to make slowly, with your lawyer and not under time pressure at the kitchen table.

If you are considering an offer with no inspection condition, ask your agent whether a pre-offer inspection is possible for that listing. Some sellers allow one and some do not.

Should you attend the inspection?

RECO says attending is your decision. It also says that many inspection companies encourage buyers to take part and that you will be better informed and able to assess whether you want to invest in any upgrades or repairs.

Attending lets you ask the inspector what a finding means and how urgent it is. A written report can list a defect without telling you whether it is a small repair or a major project.

How much does a home inspection cost?

The Ontario government says home inspection fees range from $350 to $600 and may be higher, depending on the size and condition of the home. We cannot give you a firm number for a specific house. Ask each inspector for a written quote that states what the fee includes.

The Financial Consumer Agency of Canada lists home inspection fees as an example of a closing cost, along with legal fees, property tax adjustments and title insurance. Our guide to closing costs for Ontario home buyers in Markham shows where the inspection sits among the other one-time bills.

What about condos and new homes?

The Ontario page lists common condominium areas among the things an inspector may examine. A condo purchase also comes with paperwork that an inspection of your unit will not replace. Our guide to the condo status certificate in Markham explains that document and why your lawyer reviews it.

For a newly built home from a builder, warranty and delivery rules are different from a resale. Check the current requirements with the builder, your lawyer and the regulator for new home warranties rather than relying on a general guide such as this one.

Questions to ask before you hire an inspector

Use this list when you phone around:

• What is included in your written report and when will I receive it?
• Have you inspected this type of home, for example a detached house, townhouse or condo?
• Do you provide a written contract and references?
• What accreditation do you hold?
• Do you carry insurance coverage?
• Can I attend and walk through the home with you?
• Which parts of the home can you not inspect and how will you note them?

Once you have the report, sit down with your agent and decide which items are minor and which could affect your offer. Then confirm the next steps, including any change to the agreement, with your real estate lawyer.

Where to start

If you are early in the process, our buyers page outlines how we work with purchasers in Markham. The closing day guide covers what happens once conditions are removed. To talk through your own purchase and how to word an inspection condition, contact us.