Breaking News: Home Inspection Waiver Prohibition Included in Housing Bill
Massachusetts House and Senate passed a housing bond bill that included language prohibiting home inspection waivers.
After all-night negotiations, the Massachusetts House and Senate finally passed a $5.16 billion housing bond bill that included Senate language prohibiting offers to purchase homes conditioned on waiving or limiting a home buyer’s right to a home inspection, WBUR.org reported on August 1, 2024.
In a unanimous vote (39-0) in late June, Massachusetts state senators adopted an amendment proposed by Millbury Senator Michael Moore that essentially prohibited waiving home inspections. The amendment specifically directed the Executive Office of Housing and Livable Communities to establish regulations stating that home purchases cannot be contingent upon the buyer waiving their inspection rights. The House's housing bond bill did not include any such language.
The state Senate and House of Representatives needed to reconcile their differences before sending the final housing bill to Governor Healy for consideration. That happened yesterday and included the Senate home inspection language. Moore’s office confirmed today the bill had the senator’s amendment language [See housing bond bill]. Governor Healey is expected to sign the bill.
There are two sides to the debate over prohibiting the waiver of home inspections. Some argue it is an inappropriate government intrusion into a private agreement, while others believe the prohibition is a necessary consumer protection.
In July, Moore told Real Boston that home buyers should know what they are buying before committing to one of the most significant investments in their lives.
"This amendment will curb the practice of making offers that waive the right to a home inspection, something that's become increasingly common in this ultra-competitive real estate market," Moore said. "Buyers must not feel obligated to waive inspections, risking their most important investment, in order to find their forever home. In a Commonwealth where we have long taken a strong approach to consumer protections, this is an obvious step to protect families from financial ruin due to costly undisclosed repairs."
The state Senate language is straightforward and doesn't allow sellers and agents to skirt the prohibition. The following is the full text of the amendment:
Section 101. The executive office of housing and livable communities shall promulgate regulations to ensure that no seller of a residential structure or a residential condominium unit, or agent thereof, shall: (i) condition the acceptance of an offer to purchase on the prospective purchaser's agreement to waive, limit, restrict or otherwise forego any prospective purchaser's right to have the structure or unit inspected, except when the sale of the structure or unit is to occur at an auction conducted by an auctioneer licensed under chapter 100; or (ii) accept an offer to purchase from any prospective purchaser, or agent thereof, who, in advance of the seller's acceptance of said offer, informs the seller, either directly or indirectly, that the prospective purchaser intends to waive, in whole or in part, the prospective purchaser's right to inspection; provided, however, that the seller may accept such an offer without violating this section when the prospective purchaser is: (A) the spouse, sibling, child,parent, grandparent, grandchild, great-grandchild or great-grandparent of the seller; or (B) the former spouse of the seller and the sale of the structure or unit is being made pursuant to a judgment or order under chapter 208; provided further, that other limited exceptions may be provided for by regulation."
Anyone actively involved in residential real estate knows the alarming number of prospective home buyers making offers that waive the home inspection contingency. Busy buyer agents estimate that 60 percent to 70 percent of home buyers in Greater Boston waive the home inspection contingency. Southern New Hampshire is similar.
The bond bill also included a provision allowing accessory dwelling units (ADU) by right in areas zoned for single-family homes across the state. According to the governor's office, the ADU change, allowing additions placed on single-family properties, could create up to 10,000 new units across the state.
"While towns could enact some 'reasonable restrictions,' such as setbacks from property lines, stricter rules requiring more than one parking spot per unit or limiting who can live there — as some communities have done historically — would be barred," The Boston Globe reported. "Broad statewide legalization, advocates say, will also make it easier for developers to produce ADUs at scale, since they won't need to customize projects to fit countless town-level rules."
The state will have to develop regulations. The rules and regulations will determine whether the ADU law gets watered-down to appease tony suburbs.