After a professional home inspection, a home buyer may reopen the negotiations by making a repair request.
Unless the home was marketed as an “as-is” fixer, buyers typically expect all major components to function. But if a home inspection turns up problems, or health-and-safety issues, the buyer is likely to request that the seller make repairs.
Market conditions will have an impact on repair requests. In a hot seller’s market, sellers are less likely to agree to some repairs — they may opt to go with a backup offer. Buyers, in fact, may not even make repair requests.
In a buyer’s market, buyers almost always make repair requests, and some are bold. Sellers will often agree to repairs in order to keep a buyer engaged.
Here are best practices for dealing with repair requests during a home sale:
Get a professional inspection: A home inspection is not a job for broke Uncle Bob, who “knows about houses.” Certified home inspectors have a comprehensive checklist, are trained to look for problems, and they adhere to a code of ethics. Also, without a written home inspection report, it’s more difficult to get a seller to agree to repairs.
Need a referral to a great certified home inspection company? Call us today at 951-778-9700 and we’ll connect you.
Account for property age: Building codes change over time. If you’re buying a house built in 1950, you can bet that the electrical and plumbing systems probably aren’t up to current codes. But that doesn’t mean they are “illegal” or even improper. In the future, if you have to replace systems, you’ll probably be required to bring them to current standards. Check with your local municipalities for guidance.
Roof and septic inspections are separate: A home inspector may visually inspect a roof, but they won’t give you a roof certification. If you want a full-on roof inspection, you’ll have to call a licensed roofing contractor, who can inspect and give a certification (warranty). Septic systems must be certified by licensed septic companies.
Don’t sweat the small stuff: Home inspectors will nit-pick a property, if only to cover their backsides. But every home has issues. If you decide to request repairs from the seller, stick to the most critical health-and-safety problems: broken windows, electrical dangers, HVAC defects, etc. Wall dings and carpet stains are not good repair requests, and in fact, can turn a seller against you.
Consider a credit for repairs: If you’re handy, or know someone who is handy, you might be able to negotiate a credit from the seller to take care of repairs after the sale closes, saving yourself money in the process.
Wait for the appraisal: If you’re applying for a mortgage, your lender will require an appraisal of the home’s value. Some loan programs, especially those with low down-payment requirements, have strict rules about property condition. And if an appraiser notes repair issues, the lender may require repairs. You’ll want to include those in your repair request — your lender is the leverage that gives the request weight. (Lender-required repairs must be completed before the sale closes.)
Get a home warranty: Make sure your agent includes a home warranty in your purchase offer. These types of warranties typically cover most major systems in a home (read the fine print). So if the water heater, which looked old during the inspection, breaks a month after you move in, it could save you hundreds of dollars in repairs. (Warranties only cover items that break AFTER the sale closes.)
Expect a repair request: All houses have problems. Some, you may not even be aware of. Your buyer will expect the home to be in at least average condition with all major systems (plumbing, electrical, doors and windows, roof, heating and air conditioning) functional. If an inspector finds something isn’t working, or encounters what they deem to be a health-and-safety defect, expect the buyer to ask that it be repaired.
Don’t take it personally: If the buyer is paying close to market value, they will expect the home to be in working condition. When you receive the repair request, even if it seems outrageous, don’t freak out. This isn’t personal, it’s business. And if roles were reversed, you would probably make the same request. So consider the request and respond accordingly.
Consider an inspection before you sell: If you’re in a buyer’s market, a balanced market, or if you are trying to max out the potential sales price, you may consider getting your own home inspection and fixing everything before you even put it on the market. Buyers who find a lot of little problems automatically assume bigger problems lurk beneath the surface. And consequently, they make lower offers.
A bird in the hand: If a buyer makes a repair request, you have the choice to agree, compromise or disagree. If you flat-out reject a repair request, you risk losing the buyer altogether. That means you’re back on the market looking for a new prospect. We’ve seen homeowners take a hard line, only to lose a buyer and then sell for even less weeks or months later. Consider the market conditions, the pros and cons, and then make your decision.
Thinking about buying or selling a home? Want to discuss today’s best strategies? Call us today at 951-778-9700 or use the form below to request a 10-minute consultation.
illustration courtesy of stockimages, David Castillo Dominici | freedigitalphotos.net
Home Repair Requests | Buying a Home in Riverside CA | Selling a Home in Riverside CA | Brian Bean and Tim Hardin Dream Big Realty ONE Group