In Massachusetts, we have a rather archaic practice regarding agreements for the purchase and sale of real estate. There is an Offer to Purchase (usually signed by both parties without the benefit of counsel). After the Offer is signed, there is an hiatus where the Buyer causes a home inspection to be conducted. A well-written Offer will give the Buyer a complete “out” if the Buyer finds something that is seriously wrong with the dwelling.<\/p>\n
The difficult issues come up when small issues arise, and the Buyer often sees these as an opportunity to “renegotiate” the deal. The Buyer’s risk after the Offer is signed is minimal. He or she could possibly lose the $500 or $1,000 which they put down as a “good faith binder” when they submitted the Offer. The Buyer has\u00a0much more\u00a0risk after the Purchase and Sale Agreement (more terms, almost always with the assistance of counsel, and a substantial deposit) is signed.<\/p>\n
Whichever side I am representing in terms of turning an Offer into a Purchase and Sale Agreement, these are the rules, I try to live by with home inspection issues:<\/p>\n
\u00a0\u00a0\u00a0\u00a0 1. Unless we are speaking about new construction, and Seller’s warranties, the Buyer is purchasing a<\/strong> “used house”.<\/strong> That means that the paint may be chipped, the electrical and plumbing systems not the most modern, the boiler not as efficient as the brand new ones. The Buyer needs to understand this set of facts and accept them.<\/p>\n \u00a0\u00a0\u00a0\u00a0 2. Health and safety issues are a different story.<\/strong>If the electrical system contains unsafe wiring, or there is a hole in the foundation, these items needs to be addressed. I normally opt for a “credit at closing” over having the Seller do the repairs. Somehow, I cannot see the Seller putting his or her heart and soul into a repair or re-installation\u00a0which is only done to permit the sale of the dwelling. To me, the Buyer is the proper person to effect this work, because of his or her entirely different perspective on the project.<\/p>\n \u00a0\u00a0\u00a0\u00a0 3. Nothing I have said in Paragraphs 1 or 2 applies if one of the parties has disparate bargaining power.<\/strong> A home which has been on the market for 249 days is a lot different from one that was listed last week. If you have a motivated Seller, there is nothing wrong with exacting some financial or repair concessions based on your situation. Similarly, if the home you have dreamed of just gets listed, you may have to swallow some expenses to get the deal done.<\/p>\n My experience has been that a savvy Buyer’s Agent will be able to steer the Buyer through this minefield. First and foremost, the Buyer’s Agent should let the Buyer know what would appear to be possible. At that point, taking a reasoned, and unemotional, approach to dealing with home inspection items seems to have worked best for my clients. I have said in other posts that a major contribution of a real estate professional is to attempt to moderate, and channel, the Buyer’s, or Sellers’,\u00a0angst. There is no better example of this talent than in the area of dealing with home inspection items, which never fail to arise.<\/p>\n","protected":false},"excerpt":{"rendered":" In Massachusetts, we have a rather archaic practice regarding agreements for the purchase and sale of real estate. There is an Offer to Purchase (usually signed by both parties without the benefit of counsel). After the Offer is signed, there is an hiatus where the Buyer causes a home inspection to be conducted. A well-written … Continue reading Dealing with Home Inspection Results–Health, Safety and that old Stand-by “Bargaining Power”<\/span>