LORAIN – Home sales in Lorain will have a new twist as the city starts point of sale inspections this year.
Last year, Lorain City Council approved the regulations in hopes of improving the city’s housing stock. There was extensive public debate in 2013 about whether, how and when the city would implement the new rules.
The new regulations became effective Jan. 1. As of last week, the city Department of Building, Housing and Planning still was waiting for the first request for an inspection, said Director Rey Carrion.
Lorain’s waterfront, workforce and industrial heritage are assets, Carrion said.
But the city has missed out when developers say Lorain needs to improve its livability to attract new businesses and residents, he said.
In summer 2013, city residents had some difficulty driving due to road construction, but the paving projects also energized residents who could see progress, Carrion said.
He predicted the coming housing improvements will have a similar effect.
‘To me, that’s the most important part that the city could be doing right now – improve your roads, improve your infrastructure, improve your housing,’ Carrion said.
But at least one real estate agent said the city rules eventually will make Lorain lose residents, property taxes and homes.
‘It really will slow down the (sale) process and the desirability of Lorain, which is the exact opposite of what should be happening in Lorain,’ said Drew Vaneck, manager of Westway Realty. The Cleveland-based agency has sold homes in Lorain, North Ridgeville and other communities in the county. The process
City Hall has had a number of calls from residents, real estate agents, title companies and others who want to learn about the point of sale inspections, said Carrion and Lorain Deputy Safety-Service Director Derek Feuerstein, who is chief of staff to Mayor Chase Ritenauer.
The city administration plans to hire three new housing inspectors by the end of January. The inspectors are required to have at least three years of experience in construction and will be required to obtain certification through the International Code Council.
If there are any requests before then, city building inspectors will review the homes for sale.
When a homeowner decides to sell, often they fix up items and make it presentable to attract buyers, Feuerstein said.
Once an owner requests an inspection, the city has 10 days to send an inspector out.
After the inspector checks the house, a report is due back to the owner in five days. Then the owner has 90 days to make repairs and request a re-inspection.
The inspection fee is $100 and it covers the re-inspection. Owners do not have to pay $100 per site visit.
If the 90 days pass and the owner is not able to complete repairs, the buyer can put money in escrow to pay for the repairs. The city then will issue a certificate of inspection because it has a guarantee there is money to cover the list, Feuerstein said.
The owner would get the money back once the needed repairs are made, he said.
The buyer also may assume the violations. They will get six months to make repairs, but must put enough money in escrow to cover the costs of repairs.
The certificate of inspection is good for one year and the seller is required to present it to potential buyers.
The inspectors will be assigned to certain areas of the city so they get to know Lorain neighborhoods, Feuerstein said. It is obvious the older homes in central Lorain will have more issues than the newer structures built on the city’s west side, he said.
Like many city services, weather also will dictate how the inspectors do their jobs. For example, if snow is covering a roof they will make an effort to report if the roof is in stable condition atop the house.
Newly built homes that are inspected for occupancy are exempt, as are homes that people inherit and homes that banks take possession of through foreclosure. Bank owners will have to get home inspections to sell them to private buyers. The effects
A general concern is that Lorain will mandate home owners to upgrade older plumbing and wiring.
‘Curb appeal and safety are really the two concerns that we have faced passing point of sale,’ Feuerstein said. ‘We don’t want homes to be completely rebuilt and remodeled. Whatever you have, maintain. If your gutter is falling off, if your roof is falling down, fix it.’
Vaneck said real estate agents agree home maintenance is necessary.
‘The financing is the real killer of this,’ he said about point of sale.
The inspection and escrow requirement will stop the first-time buyers who have the ability to buy a cheap fixer-upper and repair it, or at least have family and friends willing to help, Vaneck said.
It already can be difficult for first-time buyers to save up for a down payment and closing costs, Vaneck said. Banks also are reluctant to lend money for people to buy low-cost, bank-owned homes, he said.
If the home is bank-owned and abandoned for two or three years, it may have a list of items that need repair, Vaneck said.
If a house has a $50,000 asking price but the buyer must put $15,000 in escrow or repairs, the buyer likely will go elsewhere, he said.
‘There are a lot of unintended consequences that will be taking place,’ Vaneck said. ‘I’d say the first thing that is going to happen is purchasers will change cities.’
In some cases, the escrow requirement may be more than the sale price of the house, Vaneck said.
The examples are not just academic.
Last week, a search through www.westwayrealty.com found 41 homes for sale in Lorain priced $10,000 to $25,000; there were 76 listings priced $35,000 or less, and 136 listings of homes priced $5,000 to $50,000.
‘I don’t know what they’re going to do with all these houses,’ Vaneck said. ‘They’re going to be bulldozed.’
The effect could spread into the ‘move up market,’ Vaneck said. Many owners of homes worth $100,000 or $200,000 started smaller with $50,000 houses, he said.
Vaneck predicted the city would stop the point of sale inspections within a year.
Feuerstein said the city officials expect the new rules will take several years to have an effect, but they will change the behavior of Lorain residents.
Some citizens also favor the point of sale inspections in hopes of seeing repairs to rundown houses in city neighborhoods, he said.
‘To us, roads and houses are what make a community vibrant again,’ Feuerstein said. ‘I like to think we’re on a good path, but everyone is a critic.’
More information is expected to be posted on the
Anyone with questions about the point of sale inspections can call Carrion in the Department of Building, Housing and Planning at 440-204-2020 or Chief Building Official Richard Klinar at 440-204-2045.
