Archive for the 'Home Inspection Tips' Category

The Importance Of The Pre-Listing Inspection Part II

February 19th, 2008 categories: Tampa Real Estate, Home Inspection Tips, Tips for Sellers

I’ve written before about the pitfalls of not having a home inspected before the marketing process begins. And this morning I get an e-mail from an area inspector with the subject:

Avoid Surprises With A Pre-Listing Inspection

And that’s great advice, trust me. Why? Because as a seller, in a buyer’s market, you don’t want needed repairs of which you were previously unaware chasing your buyer away or causing the need for further negotiations. A second round of negotiating could (and does) lead to a deal gone bad.

But many sellers don’t want to fix things until they have a buyer. That’s risky business. As a seller you’re much more likely to get a better offer, and lower the risk of a buyer walking, if you’ve made the needed repairs before listing the home for sale.

Tales of Two Deals

I’m representing a buyer right now in the purchase of a 60 year old home in which we knew, going into the deal, that there were issues. But the inspection turned up more issues that we would have liked. Now we negotiate further to see if the seller will make the repairs, many of which are needed before the buyer can obtain insurance. No insurance-no loan-no deal!

At the same time I have a seller client who took my advice on the pre-list inspection. The sellers took care of the needed minor repairs. We are entering into a contract as of today with a prospective buyer with whom we were able to communicate the condition of the home. We provided the seller’s disclosures and let the buyers know that the home had been professionally inspected and that repairs were made. The buyers will get their own inspections done of course, and we are confident that any deficiencies will be minor, if any.

The inspectors e-mail says it best:

“A pre-listing home inspection can uncover previously unknown problems - major and minor - allowing sellers the opportunity to make repairs or replacements as needed. By addressing these issues before the home goes on the market, you can list a home with confidence in its condition and will have a better chance of maximizing its value. Being aware of issues in advance will also allow for disclosure of problems when selling, which can result in cleaner offers and a smoother transaction for both parties.”

From Pillar To Post Home Inspections
Right he is!

Posted by Lenny Gurvich | No Comments »

What It Means To Sell “As-Is”

July 25th, 2007 categories: Tampa Condos, South Tampa, Tampa Florida Real Estate, Home Inspection Tips, Tips for Sellers

It sounds self explanatory, but understanding what “as-is” means with regard to selling or buying a home usually takes some explaining.

When homeowners put the home on the market, they have a choice to sell the home in its current condition (as-is) or offer to make repairs for the buyers before the transaction closes. We always recommend a home inspection before the marketing process begins. That way the seller is made aware of any problems that may come up when the buyers have their own home inspections done. The seller can either make the repairs before putting the home on the market or wait for the buyers to request certain repairs. Alternatively the seller can offer the home in its as-is condition and price the home with regard to any repairs that need to be made.

But here’s what usually happens in an as-is sale: The buyer will agree to purchase the home as-is but with the right to inspect the home for say, 10 days or so. A smart buyer, or one who is well represented, will also have the right to cancel the purchase based on the results of the home inspection(s). Or they may have the right to cancel the purchase if necessary repairs exceed a certain dollar amount.

So the buyer, in holding the “right to cancel card”, certainly has a strong asset in negotiating any repairs, price reduction, etc. If the buyer finds any major repairs that need to be made, that buyer will most likely ask the seller for some help. The buyer may demand a price reduction or that some cash be held in escrow to pay for the repairs. And if the seller does not agree? The buyer may just walk, especially in this market, where more realistic sellers with a home that needs no repairs may be just down the street.

Hopefully, for the seller, the home inspection passes with flying colors and the buyers accept the home in its “as-is” condition, waive the right to cancel, and proceed to closing. Which brings us back to the pre-listing home inspection, something we always recommend. Our advice, especially in a strong buyers’ market, is to get the home professionally inspected and make repairs before putting it on the market. A seller can then have confidence in promising to make any needed repairs for the buyers because no repairs will be needed.

But maybe a seller has major repairs to make but no cash to make them. Then be sure to disclose all known repairs that need to be made and price the home accordingly, or be ready to give up some proceeds from the sale so that the buyers can make the needed repairs.

Also Read: Why Hire A Home Inspector?

 

Posted by Lenny Gurvich | 2 Comments »

The Importance Of The Pre-List Title Examination

July 8th, 2007 categories: Tampa Real Estate, Home Inspection Tips, Tips for Sellers

There are many concerns that a homeowner should have before listing their home for sale and actively searching for a buyer. I always recommend a pre-listing home inspection to my seller clients. A thorough home inspection can and will uncover problems that lead to obstacles in getting a home sold. Why let your buyer’s home inspector find that roof leak if you can nip it in the bud with your own inspection?

And as a home inspection can turn up problems with the home, a title search can uncover issues with the marketability of the title to the property that may cause problems once a seller has found a buyer. We had this happen to a recently divorced seller of ours a few weeks ago. After finding a buyer in only a week, title company “A” found that there was an issue with the title, and the long lost ex-husband would have to be found before we could close. The buyer was in a situation that demanded a quick closing, to which our client had agreed. If we could not close on time, the buyer may have to look elsewhere we were told.

Title Company “A” could not give us a concrete answer on what was needed to get the deal closed. Would the ex have to sign a quitclaim deed? Not sure. When Title Company “A” could not provide a swift enough resolution, and the deal was at risk, our nervous seller went out and found a Title Company that looked over the facts and was able to promise a closing on the agreed upon date. Had she waited for company “A”’s answer we may have lost our buyer.

(While the story above is true, it was somewhat embellished to drive home the point)

So this is only one example of why we recommend a pre-listing title examination. It can be done pretty quickly and most Title Companies and some real estate attorneys will do this pro-bono (they want your business). They will simply check the chain of title to make sure things were done correctly each time ownership was conveyed. Any problems that are uncovered can be resolved before marketing the property and finding a buyer. This can go a long way to assuring a relatively pain-free transaction.

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Posted by Lenny Gurvich | No Comments »

Please Get Rid Of The Knob And Tube Wiring!

November 30th, 2006 categories: Tampa Real Estate, Homes For Sale in Tampa, Seminole Heights Homes, Home Inspection Tips, Tips for Sellers

One of the most important revelations of a home inspection I attended yesterday was that the home, built in the 1940’s, still has some live knob and tube wiring. Why was this important? Well, my client will be unable to obtain basic homeowners insurance on this home as long as this old wiring is still active. No insurance-no loan-no deal!

Photo of knob and tube wiring in a 1930s home in Pittsburgh, PA., taken by Laura Scudder and obtained from:http://commons.wikimedia.org/wiki/Image:Knob_and_tube_1930.jpg through GFDL licensing.

This wiring type was used in homes built prior to the ’50’s and does not include a ground wire, making it unsafe it the eyes of many insurers, including Citizens, the insurer of last resort in Florida. The cloth insulation deteriorates over time as well, making it a fire hazard.

So where do we go from here? Anytime I represent a client on the purchase of an older home, I make sure to have an inspection contingency that gives the buyer the right to cancel for any reason, based on the results of the inspections, be they a home inspection, pest (termite) inspection, structural inspection, etc. Most sellers, in this market especially, will accept such a contingency as long as the right to cancel period expires after a reasonable amount of time.

But in this case, the seller will not be able to sell the home to a buyer who needs a loan to purchase the home. Without insurance, the loan cannot be obtained and the buyer has an out, and the right to get her deposit refunded.

So the seller has to look for a cash buyer, who would not need insurance prior to closing, or remedy the problem. So the next step is an estimate to replace the old stuff with the new stuff. We’ll then ask Mr. Seller to pay for this replacement. And if the seller refuses? Then we’ll most likely play the right to cancel card and walk away from the deal.

The sellers could have made things easier on themselves by getting a home inspection prior to putting the home on the market. A good inspector would have notified the seller of the problem and the seller could have made the repairs beforehand. I always suggest a pre-listing home inspection. Sure, there is some additional upfront costs, but correcting this problem in advance could go a long way in making the sales process flow much more smoothly.

My client is a first time buyer, so this is something that immediately puts a bad taste in her mouth. The old wiring, along with some of the other old-house issues, may be enough to make her play the right to cancel card without asking for the wiring fix. We’ll see.

Sellers: Consider a pre-listing home inspection. If you have active knob and tube wiring in your home, nix it before trying to find a buyer!

Posted by Lenny Gurvich | No Comments »

Disclosing Death In A Home For Sale In Florida

November 28th, 2006 categories: Tampa Real Estate, Tampa Homes, Tampa Florida Real Estate, Home Inspection Tips, Tips for Sellers

I recently had a prospective client ask me to list his home for sale. During our initial conversation he noted that his mother had recently passed away in the home and that she was discovered by a visiting relative.

Sellers are required to disclose anything that will materially affect the value of the real property. So is this something he needs to disclose? I will surely be asked by buyers and/or their agents the reason why the home is for sale. “Estate sale”, will be my answer. If the question of whether or not the owner died in the home is asked, I ethically have to provide the correct answer. If it matters to the buyer, then the buyer needs to know. In this case it was a natural death.

But what are the legal issues? According to the 2006 Florida Statute 689.25:

(b) The fact that a property was, or was at any time suspected to have been, the site of a homicide, suicide, or death is not a material fact that must be disclosed in a real estate transaction.

So no, my client does not need to offer this information upfront on the Seller’s Real Property Disclosure.

Furthermore, the same statute states the following:

1)(a) The fact that an occupant of real property is infected or has been infected with human immunodeficiency virus or diagnosed with acquired immune deficiency syndrome is not a material fact that must be disclosed in a real estate transaction.

and

(2) A cause of action shall not arise against an owner of real property, his or her agent, an agent of a transferee of real property, or a person licensed under chapter 475 for the failure to disclose to the transferee that the property was or was suspected to have been the site of a homicide, suicide, or death or that an occupant of that property was infected with human immunodeficiency virus or diagnosed with acquired immune deficiency syndrome.

So Florida law protects sellers and their agents from not disclosing these things to prospective buyers. If you’re a buyer and any of these things concern you, don’t expect the answers to be offered by the seller. You’ll have to ask and hope someone knows the answer.

Posted by Lenny Gurvich | 1 Comment »

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