In a real estate transaction, seller repairs can be the unexpected, last-minute nightmare that unravels a transaction long after both sides believed the negotiations were done. In some cases, buyers or sellers (or both) may have unreasonable expectations of the property's condition. Most of the time, however, finding a solution that works for everyone is simply a matter of perspective. Identifying which repair items are critical is key. From there, buyers, sellers and their agents simply need to find common ground to reach a resolution.
Knowing Which Repairs to Ask For
If the home you're purchasing is older or in less-than-perfect condition, it's reasonable to expect that the inspection may turn up multiple items of note. Remember that home inspectors are paid to identify the condition of every system and feature of the house, so don't be surprised if an older home's inspection report is extensive. The key is to identify those items that pose a threat to safety, those that could result in significant property damage and those that will cost a lot to repair. This is especially true if you're already paying top dollar for the home. If your agent has negotiated an exceptional price, you can potentially scare the sellers away with unreasonable repair demands.
When Renegotiation Is in Order
Home sellers may not always be in a position to make the repairs you have requested. If the seller lives out of state, for example, or simply lacks the funds to complete repairs, you may consider another option. If you can determine the cost to complete the repairs that you request, the seller may be willing to renegotiate the contract price accordingly. A licensed general contractor can provide an estimate to do the work, which your agent can share with the seller as a part of requesting renegotiations. This is a popular strategy for bank-owned homes — the seller will rarely agree to make repairs on these.
Alternatives to Seller Repairs
If the seller is unable or unwilling to make the repairs and refuses to renegotiate the purchase price, you still have more options to explore. Ask your Realtor® about the possibility of an escrow hold-back. In this case, an agreed-upon amount of the seller's proceeds is retained by the escrow company to be used for a specific purpose agreed upon by the parties. Depending on the bargain struck, the buyer or seller engages contractors to complete the specified repairs after close of escrow, and, upon completion of the work, the escrow agent releases the funds to the appropriate party.
The Edie Israel Team works tirelessly for their clients to ensure their best interests are protected in every real estate transaction. Understanding the nuances of negotiation can be confusing or overwhelming. Contact them today to gain a greater understanding of the home inspection process and seller repairs.