First Time Vacant

If there is one property condition that causes field inspectors great concern, it would be vacant properties. More precisely, the determination of occupancy – is the property occupied or is the property vacant?

The inspection results on First Time Vacant properties, also known as FTV, are vital to all parties concerned. The results are used to determine if property preservation work is required to secure and or winterize the property. Often the inspection results will influence changes to insurance and utility accounts.

It is important to be as specific and accurate as possible when reporting inspection results on FTV properties. After the inspector determines if each utility is on or off, supporting comments are absolutely necessary. Although, most companies give an option to mark “unknown”, this answer in nothing more than a postponement of the necessity to state “yes” or “no”. If “unknown” is reported, a narrative explaining why is absolutely required. Very few reasons are accepted for reporting “unknown”. Not having access to the utilities is valid but that must be explained and supported with pictures.

For some reason, most companies have taken the stand that their field inspectors are always wrong if the property preservation contractor reports something different from the inspector. As a result, there is a growing trend to report the property as vacant if there is any doubt at all. When the property is reported as vacant, the preservation contractor will be sent to the property. If the contractor finds the property occupied, the inspector usually is penalized financially – a chargeback. After spending considerable time trying to make a determination, the inspector may feel the chargeback will be less than the time and effort involved to “know for sure”.

The “occupancy determination” problem is compounded by the fact that vagrants set up housekeeping in vacant properties and real estate companies often turn on utilities and place furniture in the home to “stage” the property.