How to proceed once you have your home inspection?
February 21, 2012 1:26 PM Subscribe
How to decide what to request repairs vs. credit vs. ignoring after a home inspection?
How did you proceed once you had your home inspection in hand?
Wife and I just got our home inspection back for the home we are buying. No giant issues, but still 50+ items that were found that could/should be improved. What we're not clear on is how to determine which we should be asking for money for, which to ask for fixes and which to ignore/defer to do ourselves.
At the moment we're leaning toward requiring (requesting?) fixes for everything on the roof and all the plumbing, getting credit for those things that we might want to upgrade ex. faulty gas heater vent that we might upgrade to a tankless.
For those things that we ask for credit for, how do we determine amounts? There is minor plumbing, electrical, HVAC and drainage work to be done, does that mean calling out a specialist for each to get estimates? Or getting a general-purpose contractor or two to come out and estimate each task?
Getting all the work and estimates done inside a 3 week window until close seems like it'll be tough. Do tradespeople deal with these sorts of deadlines all the time?
How did you proceed once you had your home inspection in hand?
Wife and I just got our home inspection back for the home we are buying. No giant issues, but still 50+ items that were found that could/should be improved. What we're not clear on is how to determine which we should be asking for money for, which to ask for fixes and which to ignore/defer to do ourselves.
At the moment we're leaning toward requiring (requesting?) fixes for everything on the roof and all the plumbing, getting credit for those things that we might want to upgrade ex. faulty gas heater vent that we might upgrade to a tankless.
For those things that we ask for credit for, how do we determine amounts? There is minor plumbing, electrical, HVAC and drainage work to be done, does that mean calling out a specialist for each to get estimates? Or getting a general-purpose contractor or two to come out and estimate each task?
Getting all the work and estimates done inside a 3 week window until close seems like it'll be tough. Do tradespeople deal with these sorts of deadlines all the time?
When we bought our house, we went back after the inspection and told them what we required. We put two offers on the table: First they could reduce the price by a large flat amount that took into account the repairs, and time and effort we'd be putting in and covered our ass. Second, they could fix things and provide receipts from professional contractors to demonstrate that the work had been done adequately.
You don't close until your demands are met. It's a negotiation, you can ASK anything. You can demand that they hire certain contractors, or just that it be fixed at all, you can ask for money back, you can do anything you want.
It's a negotiation. You're trying to make sure that you pay what the house is worth to you. If they won't go down to that number, then you don't want to buy it. Make them deal with anything that you don't want to deal with.
posted by Stagger Lee at 1:33 PM on February 21, 2012 [2 favorites]
You don't close until your demands are met. It's a negotiation, you can ASK anything. You can demand that they hire certain contractors, or just that it be fixed at all, you can ask for money back, you can do anything you want.
It's a negotiation. You're trying to make sure that you pay what the house is worth to you. If they won't go down to that number, then you don't want to buy it. Make them deal with anything that you don't want to deal with.
posted by Stagger Lee at 1:33 PM on February 21, 2012 [2 favorites]
My father is an electrician in Maine, and I grew up working for him. On that authority, and considering how lousy the economy is right now for construction workers, it probably won't be hard to find someone to do the work at a reasonable price on short notice. But I still wouldn't put it off. You mentioned some minor electrical work that needed to be done. Are you talking about just putting in some GFCIs, or are you talking about something like upgrading from a fuse panel to breakers?
posted by jwhite1979 at 1:40 PM on February 21, 2012
posted by jwhite1979 at 1:40 PM on February 21, 2012
In the past year I bought one house and sold another.
The house I sold was priced in a manner that reflected the repairs needed, and I made that clear in the sales price and the description of the house. One potential buyer came back with an offer that not only lowballed the price but asked for a LOT of repairs. I said no and wouldn't entertain another offer from that individual.
Another person came back with a reasonable offer and asked for mortgage inspection required repairs... I accepted and did the repairs.....
The house I purchased was at a very good price, needed a bunch of finish work done (it was fairly new, owner constructed). I asked for NO repairs.
So, it comes down to: Are you willing to risk having your offer turned down due to the repairs you're requesting? Does the price reflect the value of the house "as is" or "if the repairs were done"? How bad do you want the house, is it unique or are there a million out there just like it.
posted by HuronBob at 1:52 PM on February 21, 2012
The house I sold was priced in a manner that reflected the repairs needed, and I made that clear in the sales price and the description of the house. One potential buyer came back with an offer that not only lowballed the price but asked for a LOT of repairs. I said no and wouldn't entertain another offer from that individual.
Another person came back with a reasonable offer and asked for mortgage inspection required repairs... I accepted and did the repairs.....
The house I purchased was at a very good price, needed a bunch of finish work done (it was fairly new, owner constructed). I asked for NO repairs.
So, it comes down to: Are you willing to risk having your offer turned down due to the repairs you're requesting? Does the price reflect the value of the house "as is" or "if the repairs were done"? How bad do you want the house, is it unique or are there a million out there just like it.
posted by HuronBob at 1:52 PM on February 21, 2012
I work for a general contractor. Three weeks is a tall order considering a contractor has to look at the scope of work, get prices from their subs, pull all necessary permits, and do the work. But we're used to people wanting it done yesterday and we do our best to accommodate. Hiring the individual trades yourself could work, especially if the items are minor, but if you get a decent contractor, chances are they use the same subs a lot of the time. We always do, which means that the customer can be confident that the trades will respond to our requests quickly, work on our deadlines, and perhaps most critically, they will show up when they say they will and do a good job.
Your best bet when hiring a contractor is to ask around and find someone who can vouch for them firsthand.
Curious to know what those 50+ items on the list are.
posted by futureisunwritten at 1:58 PM on February 21, 2012
Your best bet when hiring a contractor is to ask around and find someone who can vouch for them firsthand.
Curious to know what those 50+ items on the list are.
posted by futureisunwritten at 1:58 PM on February 21, 2012
I agree with Rock Steady -- getting cash for repairs is a good way to ensure the work isn't shoddy junk done by the lowest bidder. Basically, this is another offer process, and bid accordingly.
posted by zvs at 2:10 PM on February 21, 2012 [2 favorites]
posted by zvs at 2:10 PM on February 21, 2012 [2 favorites]
50+ items, even if they are each small, is a ton of issues. I would have walked away from a house like that when I was looking. We changed our mind on one house that needed around 10 things dealt with, even, though, so we are fussy. (It's also a seller's market here, so they probably would have said "screw you" if we'd asked for fixes, and houses are often selling above their asking price here).
I would say you should ask for fixes for anything where the repair has a potential to uncover more serious problems, or where it could just turn out to take longer and be more complicated than it looks. That means the roof, for sure. And anything that requires opening up walls. Probably any electrical work. That way if it does uncover worse stuff you can (presumably) still walk away.
posted by lollusc at 2:16 PM on February 21, 2012
I would say you should ask for fixes for anything where the repair has a potential to uncover more serious problems, or where it could just turn out to take longer and be more complicated than it looks. That means the roof, for sure. And anything that requires opening up walls. Probably any electrical work. That way if it does uncover worse stuff you can (presumably) still walk away.
posted by lollusc at 2:16 PM on February 21, 2012
I am contractor and a real estate investor.
Roof and exterior walls first. Secure the basic structure.
Mechanicals (electric, plumbing, HVAC) next.
Cosmetics lasts.
posted by Flood at 2:18 PM on February 21, 2012 [1 favorite]
Roof and exterior walls first. Secure the basic structure.
Mechanicals (electric, plumbing, HVAC) next.
Cosmetics lasts.
posted by Flood at 2:18 PM on February 21, 2012 [1 favorite]
I have sold and bought a few houses. This is always tricky.
If I were selling (and I do have my house on the market) and a person came back with a list of all 50 things that needed fixed, I would reject it and wait for the next offer. You are buying a used house and with that some things will just be needing repair and the current owner likely has that already priced in. You know you are buying a used house. Don't expect to be paying for brand new.
However, I would expect that anything THIS owner had fixed/installed (roof, counters, paint), that it is reasonable to have it repaired before closing. If you want some gutters fixed that are 50 years old and obviously this guy has never touched, well, I would just let that stuff slide and fix it myself -- since it is a used house.
posted by LeanGreen at 2:27 PM on February 21, 2012 [2 favorites]
If I were selling (and I do have my house on the market) and a person came back with a list of all 50 things that needed fixed, I would reject it and wait for the next offer. You are buying a used house and with that some things will just be needing repair and the current owner likely has that already priced in. You know you are buying a used house. Don't expect to be paying for brand new.
However, I would expect that anything THIS owner had fixed/installed (roof, counters, paint), that it is reasonable to have it repaired before closing. If you want some gutters fixed that are 50 years old and obviously this guy has never touched, well, I would just let that stuff slide and fix it myself -- since it is a used house.
posted by LeanGreen at 2:27 PM on February 21, 2012 [2 favorites]
As a seller closing this week I would advice asking for concessions unless there is major issue that can't be sized/ estimated (like replacing roof).
Otherwise for smaller stuff you can expect seller to do bare minimum at lowest cost. There is also likely to be disconnect between what you want vs. how it gets done.
posted by zeikka at 2:39 PM on February 21, 2012 [1 favorite]
Otherwise for smaller stuff you can expect seller to do bare minimum at lowest cost. There is also likely to be disconnect between what you want vs. how it gets done.
posted by zeikka at 2:39 PM on February 21, 2012 [1 favorite]
Response by poster: The house was largely remodeled as a flip. New kitchen, bathrooms, roof, windows, all walls painted. The previous owner had 10-14 people renting in a 4 bedroom, so the house was in dire need of fixing.
I think that asking for the things that were touched as part of the remodel to be fixed (like, the roof flashings that aren't sealed well, GFI's were installed but don't all work correctly) is a good plan, and asking for credit for the other items. That way we only have to worry about getting estimates, not the work done before closing, and the seller can call back in the people who did the work to fix it.
None of the issues are likely to reveal something larger. The biggest other concern is the lack of permits- the owner didn't pull any for the work.
posted by Four Flavors at 3:48 PM on February 21, 2012
I think that asking for the things that were touched as part of the remodel to be fixed (like, the roof flashings that aren't sealed well, GFI's were installed but don't all work correctly) is a good plan, and asking for credit for the other items. That way we only have to worry about getting estimates, not the work done before closing, and the seller can call back in the people who did the work to fix it.
None of the issues are likely to reveal something larger. The biggest other concern is the lack of permits- the owner didn't pull any for the work.
posted by Four Flavors at 3:48 PM on February 21, 2012
The biggest other concern is the lack of permits- the owner didn't pull any for the work.
That can be a concern, depending on what is now hidden by the work. Is the electrical crap? Are there junction boxes hidden in the drywall? Has the vapor barrier / insulation been installed correctly? Are the structural joints up to code, has the roof been done properly, ice barriers installed etc. etc.. It depends a bit on the scope of the work, if it's mostly cosmetic-type stuff, you can probably get away with it..
posted by defcom1 at 5:07 PM on February 21, 2012
That can be a concern, depending on what is now hidden by the work. Is the electrical crap? Are there junction boxes hidden in the drywall? Has the vapor barrier / insulation been installed correctly? Are the structural joints up to code, has the roof been done properly, ice barriers installed etc. etc.. It depends a bit on the scope of the work, if it's mostly cosmetic-type stuff, you can probably get away with it..
posted by defcom1 at 5:07 PM on February 21, 2012
The things you mentioned are all HUGE red flags that you could be getting into a nightmare. I would get a contractor to come in and look at stuff. Home inspectors are usually NOT contractors and just look for visible stuff that is not code compliant. Improperly done roof flashing means potential water leaks, and what did he put in that needed new flashing? if it was a new roof, is the stuff you can't see under the roof ok? GFCI that aren't working right could mean the whole wiring is crap, the panel overloaded or wired wrong and stuff hidden in the walls. Stuff that isn't great but no indicator of deeper problems is worn carpet, missing door pulls in the kitchen, painted shut windows. Anything that was done as part of the flip by an amateur (without permits! yikes) that isn't working right is something to be very, very wary of.
BTW I now own a 110 year old victorian that needs substantial updating and had/has lots of cosmetic problems but no deep structural or wiring problems. Verified by a professional before I bought the house. That being said we are getting an new electrical panel (5000), had a new furnace last year (4500) and I am updating a bathroom totally DIY (about 2000). Hidden house problems can be expensive.
posted by bartonlong at 6:21 PM on February 21, 2012 [3 favorites]
BTW I now own a 110 year old victorian that needs substantial updating and had/has lots of cosmetic problems but no deep structural or wiring problems. Verified by a professional before I bought the house. That being said we are getting an new electrical panel (5000), had a new furnace last year (4500) and I am updating a bathroom totally DIY (about 2000). Hidden house problems can be expensive.
posted by bartonlong at 6:21 PM on February 21, 2012 [3 favorites]
I'm going through this now, too. I just went through it on a house before this one which turned out to be a disaster waiting to happen, and I rejected the inspection. The one before that went perfectly until the appraiser shot it down.
My strategy is: anything urgent? Like, side sewer about to collapse, chimney about to fall down? They fix.
Minor stuff that would be easy and cheap for someone in the business but difficult for me (at my handyman skill level - zero): they fix
Non-urgent big thing that will have to be done in the fairly near future that costs a lot of money, like old roof, deck that needs to be torn down and rebuilt to replace wood rot: credit.
Cosmetic stuff that's a matter of personal preference, like lighting fixtures (that aren't faulty, just ugly), etc: for me to do later
Everything else: on my list of projects for me to do sometime.
I've got 38 pages of inspection findings (it was a sound house, but my inspector is thourough) and I only ended up asking for 8-10 things from the seller. I'm only considering one thing a deal-breaker (some shady electrical issues, they have an electrician.)
But I had to beat out 2 other offers on this house 2 days after it listed. Other people have said in this market your best strategy is to ask for everything on the inspection (minus the cosmetic and decorating stuff) and make them say no.
posted by ctmf at 7:37 PM on February 21, 2012 [1 favorite]
My strategy is: anything urgent? Like, side sewer about to collapse, chimney about to fall down? They fix.
Minor stuff that would be easy and cheap for someone in the business but difficult for me (at my handyman skill level - zero): they fix
Non-urgent big thing that will have to be done in the fairly near future that costs a lot of money, like old roof, deck that needs to be torn down and rebuilt to replace wood rot: credit.
Cosmetic stuff that's a matter of personal preference, like lighting fixtures (that aren't faulty, just ugly), etc: for me to do later
Everything else: on my list of projects for me to do sometime.
I've got 38 pages of inspection findings (it was a sound house, but my inspector is thourough) and I only ended up asking for 8-10 things from the seller. I'm only considering one thing a deal-breaker (some shady electrical issues, they have an electrician.)
But I had to beat out 2 other offers on this house 2 days after it listed. Other people have said in this market your best strategy is to ask for everything on the inspection (minus the cosmetic and decorating stuff) and make them say no.
posted by ctmf at 7:37 PM on February 21, 2012 [1 favorite]
Oh, and by the way, aside from the danger of shoddy work: if they didn't get permits for the work, it isn't done as far as the appraisal is concerned. The appraiser will not consider it a house with a deck, if the deck did not have a permit.
And don't think that you shouldn't ask for work on something the flipper didn't touch. It's his house now, and you're buying the whole house, not just the part he worked on.
See if you can guesstimate how much he paid for the house and how much money he put into it, and then try to guess how much he's making on the deal (your agent should be able to help you guess how much his selling expenses will be, like excise tax and broker fees). Not that you should feel obligated to give him a profit if he doesn't deserve it, but it might give you a better guess for how much more money you can make him spend before he gives up the sale.
posted by ctmf at 7:46 PM on February 21, 2012 [2 favorites]
And don't think that you shouldn't ask for work on something the flipper didn't touch. It's his house now, and you're buying the whole house, not just the part he worked on.
See if you can guesstimate how much he paid for the house and how much money he put into it, and then try to guess how much he's making on the deal (your agent should be able to help you guess how much his selling expenses will be, like excise tax and broker fees). Not that you should feel obligated to give him a profit if he doesn't deserve it, but it might give you a better guess for how much more money you can make him spend before he gives up the sale.
posted by ctmf at 7:46 PM on February 21, 2012 [2 favorites]
Be very wary, the fact that there were no permits for any of this work really stinks of homegrown remodeling that may not be up to code or may well be dangerous. Also, if you get it inspected later for some other reason and the house isn't up to code and that's reported, you'll be the one fixing it at your expense or else you might face fines.
posted by i feel possessed at 7:55 PM on February 21, 2012
posted by i feel possessed at 7:55 PM on February 21, 2012
Another consideration: Me, I can easily get a loan for much more than the house is listed for, but I don't have any cash money.* So a selling price concession for work that I'm going to have to do right away doesn't do me any good. It's not like if I get 20k knocked off I can go out and spend 20k on repairs. I still don't have the cash.
*not counting emergency money that I don't consider in play at any non-disaster time.
posted by ctmf at 8:06 PM on February 21, 2012 [1 favorite]
*not counting emergency money that I don't consider in play at any non-disaster time.
posted by ctmf at 8:06 PM on February 21, 2012 [1 favorite]
50 items sounds like a lot. And...some of the outlets the seller installed don't work properly? And he redid the whole house without permits. I think you are really looking at more problems down the road. This is a major investment. You should request cash for repairs, or all the repairs to be done.
Honestly, not to get you down on this house you want to buy, but I'd walk away. I just sold my 94 year old house with zero repairs requested which is unheard of. We have replaced all the major systems in the past two years, but still budgeted money for repairs requested after inspection.
posted by fyrebelley at 9:29 PM on February 21, 2012
Honestly, not to get you down on this house you want to buy, but I'd walk away. I just sold my 94 year old house with zero repairs requested which is unheard of. We have replaced all the major systems in the past two years, but still budgeted money for repairs requested after inspection.
posted by fyrebelley at 9:29 PM on February 21, 2012
None of the issues are likely to reveal something larger.
Yeah, I've heard that one before. None of our customers were expecting any of the surprises found behind their walls either, but often enough it is a life safety issue that must be addressed before the work can continue.
Honestly, I think you should be very concerned at this point, especially since the work was done without permits. In our case, having permits and inspections means the customer can be confident that the work is done to code. I've seen a lot of shoddy work done without permits, and usually from the perspective of the new owner having to shell out to fix it. If someone isn't pulling permits, I can only imagine what other corners they're cutting.
And being in this business, I am wary of a lot of flipped houses. I'm fascinated by how an eager buyer can be fooled by cheap (but shiny and new!) materials and a fresh coat of paint and ignore a bunch of really important things.
posted by futureisunwritten at 4:04 AM on February 22, 2012
Yeah, I've heard that one before. None of our customers were expecting any of the surprises found behind their walls either, but often enough it is a life safety issue that must be addressed before the work can continue.
Honestly, I think you should be very concerned at this point, especially since the work was done without permits. In our case, having permits and inspections means the customer can be confident that the work is done to code. I've seen a lot of shoddy work done without permits, and usually from the perspective of the new owner having to shell out to fix it. If someone isn't pulling permits, I can only imagine what other corners they're cutting.
And being in this business, I am wary of a lot of flipped houses. I'm fascinated by how an eager buyer can be fooled by cheap (but shiny and new!) materials and a fresh coat of paint and ignore a bunch of really important things.
posted by futureisunwritten at 4:04 AM on February 22, 2012
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posted by Rock Steady at 1:31 PM on February 21, 2012 [3 favorites]