Selling or Buying in Northeast Ohio? Here’s What You Should Know About Point of Sale Inspections

Kathryn Schenk, Realtor®
Keller Williams Greater Metropolitan
Properly Properties440-360-9563 | katie@properly-properties.com

POS Inspections

When buying or selling property in Greater Cleveland, you may need to deal with the city’s Point of Sale (POS) process. Not all cities require POS inspections, and each municipality handles procedures differently.
 
Before we discuss where to find POS regulations and how to handle them, let’s first explain what POS inspections are and then establish a baseline understanding of their purpose.
 
Several municipalities across Northeast Ohio require homeowners to undergo POS inspections before their property can transfer to a new owner. (And if that were all that’s involved, we could go home now; if only!)
These inspections relate to and align with city (or township) building codes and, therefore, cover elements that are unlikely to be found within General Home Inspections or Appraisal Inspections.
 
The premise for POS inspections is to ensure properties meet a certain health and safety threshold.
 
Generally, properties with a Point of Sale requirement cannot transfer to a new owner without the city’s sign-off. And this means coordination between sellers, buyers, real estate agents, title agents, and the city’s building or housing department staff. At times, removing the POS contingency is smooth sailing; at others, it’s a tedious procedure that lasts as long as the transaction.

What Cities Require POS Inspections in Northeast Ohio?

Point of Sale inspections illustrate the variability in real estate processes, as each city has its own requirements.
 
Some cities, like Akron and Beachwood, don’t have POS requirements (at least, at this time). Others only require POS inspections for rental units, such as in Lakewood. South Euclid and Painesville are among the cities that need it only when the property has been vacant. A few municipalities only ask for exterior inspections, and some only inspect new construction. Then, some cities require a Point of Sale for every single residential property, like Willowick and Cleveland Heights.

I have a running list of the cities with POS: anything with the word Heights in the name of the town probably has it, while most townships don’t. But there are the juxtaposing pairs: Mentor doesn’t have POS, but Mentor-on-the-Lake does; Willoughby has it, while Willoughby Hills does not. And, like most agents, I know the areas I work in most frequently down pat, but I consult a list when working somewhere outside of that circle.

Known NEOH Cities with Some Form of POS Inspection

 

This list is not comprehensive; more municipalities fall under the Northeast Ohio banner than I know. It may also be inaccurate as cities add or release POS regulations to their building or housing policies. Before writing an offer, you must double-check whether there is a Point of Sale requirement. (Yes, that directive is for my fellow agents, but it is up to buyers to do their due diligence as well.)

Bay Village
Beford Heights
Bratenahl
Brecksville
Brooklyn Heights
Brookpark
Cleveland Heights
East Cleveland
Eastlake
Euclid
Fairport Harbor
Garfield Heights
Gates Mills
Highland Heights
Hunting Valley Village
Lakewood
Macedonia
Maple Heights
Mayfield Heights
Mentor-on-the-Lake
Moreland Hills
Newburgh Heights
North Randall
North Ridgeville
North Royalton
Northfield Village
Oakwood Village
Orange Village
Painesville
Painesville Township
Richmond Heights
Sagamore Hills Township
Shaker Heights
Sheffield Lake
South Euclid
Twinsburg
University Heights
Warrensville Heights
Warrensville Township
Wickliffe
Willoughby

Willowick
Woodmere Village

Again, I cannot stress enough that it is your responsibility to check. Just because a municipality is not on this list does not mean it doesn’t have a Point of Sale requirement. Among these are the cities that only have POS under certain circumstances (new build, vacant, rental), so there may be no POS required even in the cities listed here.

What Does Point of Sale Inspect?

There is no standard. You may find some similarities, but there is no set list you can count on. Some cities will provide a list online, which is fantastic for motivated sellers. Still, every municipality inspects according to its own list. In some cities, I can spot violations as soon as I walk onto a property, like Shaker Heights or Cleveland Heights; I’ve seen enough properties with enough violations that I can spot the sloped balcony, the chipping paint, the missing handrail, and the cracked driveway while still focusing on my client’s interests.

A few cities clustered on the western edge of Lake County require dye test inspections for sewer function, sidewalk inspections, and fire inspections (for which some waivers may exist), in addition to the interior and exterior inspections.
 
If you really want to know what the inspectors look at and the inspections they cover, you should call the relevant authority at the city department.

What Happens When There Are POS Violations?

Many properties encounter POS violations after the first inspection, but not all. Given the age of many NEOH homes and the continual updating of building codes, it’s unsurprising to see a list of items to correct.
(I love it when MLS listings specifically state that a property will be violation-free at transfer. I still have work to do, but I can put a buyer’s mind at POS-ease from the start.)
 
But, let’s say there are violations, and you’ve gone under contract – what can you do?
 
There are only a few options:
1. The seller can repair all the items and have a clean reinspection, and the city will issue a Certificate of Transfer or Occupancy to the title company (these clearances have different names in different cities).

2. The buyer can assume the violations and be responsible for correction after the property transfers. You can be certain this involves additional paperwork. However, some cities also require an escrow hold in addition to the assumption paperwork. Essentially, one party or another puts an amount approved by the municipality into escrow until the repairs are complete. For example, a buyer might put $10K into escrow and assume the violations. After the property transfers, they repair, pay their contractors, and have a new POS inspection. Only then will they receive the escrowed funds.
 
3. Some combination of the above.

4. If the parties cannot agree, and the transaction falls out of the contract.
Is there a norm? Not by a long shot, and I’ve dealt with all the options. It all boils down to the specifics: buyer needs and affordability, seller needs and affordability, weather-dependent repairs, and the list of violations.
 
Remember that every municipality has its own process, so it’s important to verify the specific requirements for each area. Some will provide the escrowed amount, others require a contractor to provide the costs before signing off, and some don’t require escrow holds at all.

Where to Turn for Additional POS Information

The best, most reliable source is always the city itself. If you can reach someone in the housing or building department (cities themselves determine which department POS falls under), that person should be able to provide the most accurate information. At times, reaching specific individuals (by phone, by email, or by going into the city’s office) can be challenging.
 
When time is of the essence (a clear principle in real estate), you could contact a title company. They won’t be able to be as concise or answer questions about specific violations. Still, they will know the process inside and out for cities they frequently work with. As will real estate agents who work within those cit

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