Soft Wood Signs
This wood looks like it has expanded or has been
filled with wood fillers of some sort.
Use an awl to check for any damage when you run into wood that looks
soft or a possibility of wood filler.
As a potential homeowner, if you are looking at the property and
thinking about purchasing it, there is a good chance this wood will
eventually have to be replaced.
Whenever you see damage like this on a set of stairs keep one thing in
mind, stairs are a high traffic area and something like this could
become a safety hazard or a liability further down the road.
As a home inspector you are going to be looking for any irregularities
and this is a good sign of one of them.