Will Virtual Inspections Become a Standard?Posted by: jhon | Posted on: July 10, 2020
Virtual inspections have helped to move transactions during the pandemic. These inspections have been essential to maintaining social distancing and health and safety requirements during the pandemic without totally stalling the investment market, but the benefits have extended beyond the pandemic. In fact, lenders are realizing surprising benefits of virtual inspections, including cost savings, depending on the location and property.
“In addition to helping minimize in-person contact during a pandemic, virtual inspections can help save companies the cost and time associated with flying an inspector across the country or state for a traditional in-person inspection,” Matthew Stoehr, chief technology officer at Sabal Capital, tells GlobeSt.com. “However, it is important to note that virtual inspections can cost several hundred dollars to conduct, so in some cases they are more costly to utilize. Sabal has inspectors located across the country, so flying an inspector across the state may actually be less costly than the virtual option. For companies with inspectors in fewer locations, however, the cost and time savings can be significant. It’s important to analyze the potential pros and cons on a case-by-case basis.”
While virtual inspections have uncovered some unexpected benefits, Stoehr doesn’t expect virtual inspections to be a permanent change for Sabal Capital. “While I think that virtual inspections will continue to become more widespread, I don’t believe they will fully replace in-person inspections any time soon,” he says. “You simply cannot replace the value of human judgment and observation. Virtual inspection technology can help enhance, rather than replace, in-person inspections by combining technological innovation with the power of human reasoning.”
Currently, virtual inspections are conducted through video conferencing. “While it’s possible to conduct a virtual inspection using any video conferencing tool, apps like HappyCo help streamline the virtual inspection process by providing a central hub for documentation and checklists,” says Stoehr. “Thousands of virtual inspections are already conducted through these apps, and as the adoption of virtual inspections grows, technology will continue to evolve to meet market needs and address some of the current barriers to more widespread use.”
Prior to the pandemic, the industry was looking at the potential of virtual or inspections and increased use of technology. However, the technology isn’t available to truly conduct an inspection online. “While the pandemic certainly accelerated their adoption, I don’t believe that virtual inspections will become industry standard moving forward,” says Stoehr. “With the current technology, it’s simply not possible to replicate the thoroughness of an in-person inspection virtually. Instead, we may see companies choosing to take a hybrid approach that is customized based on each individual situation.”