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Old 02-09-2013, 02:04 PM
 
11 posts, read 34,100 times
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My DH and I thank everyone for their comments.

We do have children; therefore, the idea of carbon monoxide fumes from a ventless fireplace make us nervous. They are banned in California and Massachusetts and although my Republican DH might not agree with those states on much, he does agree there.

I can't say with any certainty that the sellers knew. As one responder suggested, the opinion did come from an inspector. DH, however, is more skeptical.

So we need to weigh how much value is subtracted from a home with a sealed up fireplace and how much the sellers will compensate for that loss of value. As one other writer suggested, there will be other options for us, even though we do like many things about this one. We want to find a house before the next school year, so we do have time on our side. I'll certainty let you all know how we made out !
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Old 02-09-2013, 04:56 PM
 
3,325 posts, read 3,259,105 times
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There will always be another house. Look at everything else available. Yes, a non-usable fireplace will make it harder to sell - worse than if it had no fireplace. People don't like coming in and seeing a central fireplace, then being told it's not usable. So I'd say that you're right to consider dropping your offer SIGNIFICANTLY. This is essentially a fatal flaw, similar to a wet basement that can't be easily fixed. For yourselves, you could probably put in a wood fireplace and run a stovepipe up the non-functional chimney, or put in a gas log, but it will still be a harder sell in the future. So my advice is to quickly look at everything available, decide whether you prefer this house as it is, and make a lowball offer, then wait to see what happens. BTW, it is totally permissible for you to make multiple simultaneous offers on several houses, then wait to see who responds. If it weren't for the fact that the market is heating up and interest rates are still low, I'd say to take your time, but inventory has fallen, there is pent up demand, and interest rates are low. I wouldn't be surprised if prices rise 5-10% this spring. And interest rates just can't go lower - they can only go up.
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Old 02-09-2013, 05:28 PM
 
11 posts, read 34,100 times
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Thank you kindly Parentologist. I just read your message out loud to DH and, focused as he always is on the bottom line, he wants to know how much you think is "significantly" on a
700k house hehe.

The next two nights we will be sleeping on which direction we'll take.
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Old 02-09-2013, 05:42 PM
 
673 posts, read 1,232,490 times
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Quote:
Originally Posted by jazzerstacey View Post
Thank you kindly Parentologist. I just read your message out loud to DH and, focused as he always is on the bottom line, he wants to know how much you think is "significantly" on a
700k house hehe.

The next two nights we will be sleeping on which direction we'll take.
How much value lost with no fireplace depends on the town. If you are talking about Darien, Westport, New Canaan I will say not much because buyers know that $700k homes will severe compromises. I guess 30-50k? In Wilton or Fairfield i will not buy a house without fireplace if I'm spending 700k.
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Old 02-09-2013, 06:05 PM
 
1,656 posts, read 1,830,187 times
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Quote:
Originally Posted by parentologist View Post
BTW, it is totally permissible for you to make multiple simultaneous offers on several houses, then wait to see who responds. If it weren't for the fact that the market is heating up and interest rates are still low, I'd say to take your time, but inventory has fallen, there is pent up demand, and interest rates are low. I wouldn't be surprised if prices rise 5-10% this spring. And interest rates just can't go lower - they can only go up.
With respect, and I do not mean to offend your dignity: asking prices may rise, but I'm thinking the numbers show that selling prices will fall. The fundamentals are not in place to support rising prices to recoup anybody's housing "investment". The people who will be the most badly hurt will be the ones who get caught up in the hype and buy before the state budget is released. Based on the Courant article, Malloy is increasing the state budget by 10%, raising some taxes, and borrowing the rest. The state is already in a hole attributable to $68 Billion in unfunded pension liabilities, and a significant current year deficit. The shortfall arising from the difference between revenue coming in and increased debt service going out will rest on the towns, who will need to resolve it with property tax increases.

The relationship between interest rates and prices is worth some scrutiny. House buys are hyped on the basis of howmuchamonth do you have to spend. In this economy, with wage decline (that's right) and flat job growth, an extra $100/month in property taxes - or taxes of any other kind - is going to bite into the howmuchamonth available to spend on housing. Particularly with the new underwriting rules limiting PITI to ?35% of monthly gross. If there is less income available, the only way used houses (or new ones) move is by dropping the howmuchamonth. As well, with young adult unemployment at an all time high - and you need that first time buyer to bump everybody else up the food chain - who are you going to sell the house to?

It looks like the real estate cohort is targeting the last remaining commission dollar before the March jobs report revision; and before the tax increases to be announced as a result of the next state budget. This year's referenced budget was adopted less than a year ago, and it's already $1B in the hole.

Consider what will happen after the new taxes hit, and you need to move again. Are you prepared to put tens of thousands of dollars on the table in order to pay the difference between what you owe on the mortgage, and the price you had to accept in order to sell the house? That is a significant hit. Some people are willing to do it. Personally, it's just a little rich for my blood. This dynamic is at play in every state in the country.

During the current period of nation-wide uncertainty, IMHO, there's nothing wrong with renting as a defensive measure. There are PLENTY of empty houses. Plus, there is substantial REO which will be released in a trickle before the tax increases are announced, and in a flood thereafter. When she faces the prospect of your walking away, vs. finding you someplace to rent while you ride out the storm, your house sales person can and will find you a very nice house in a fine school district to rent, that could very well be a lot more affordable than a $700K mortgage plus maintenance. Plus the $100K overage on the initial quote it will take to remodel the house to fix the chimney (what are you going to do? Leave the house without a wall as well as without a chimney? Once your dream house is half demolished due to renovations, you are at the mercy of the contractor. To them, you are a short timer as well.)

Please consider keeping your family's interests in mind above all. Consider the source, when listening to those who counsel "buy now, or be priced out forever"! Or, "this remodel will only cost you $30K and I can get it done in a month!"

Best wishes to you. Please let us know how you make out.
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Old 02-09-2013, 07:44 PM
 
3,325 posts, read 3,259,105 times
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jazzerstacey, I'd say it brings down the resale value by as much as 10%. I'm in the Hartford area, so although my husband and I buy investment property (multifamily rentals) and have bought three primary residence homes in the last fifteen years, two in this area in the last decade, I can't advise you on hard numbers in your area, which is more expensive than mine. I'm NOT in the business of selling homes, and thus have no ulterior motive to hype the market and get people buying houses. But I have made many offers on properties for the last 15 years or so, and bought seven or so. I have been watching the boom and bust cycle of the housing market in the Northeast for decades, particularly since the boom before the 1989 crash, and the recovery and boom of the late 90s to mid 2000s, and the bust that began in about 2006. I do strongly believe, and began saying so about 9 months ago, that we have just passed the trough on this housing cycle, and that things will move up from here, because it is cheaper now to own than it is to rent. This is in fact what is now happening. Inventory has tightened, and next prices will finally begin to rise. It is February. Buying season is about to start. The increase in prices will not show up until June or so, when closings happen, but I strongly believe that it will be evident by June in the statistics, and will be obvious to buyers in April, when they find themselves being outbid on houses. So with interest rates very low, and every indication that we are at or near the nadir of the market, it's a good time to buy, if buying a home makes financial sense for your family.

Every time that my husband and I bought a residence, we looked at EVERYTHING on the market that was remotely suitable for us. When we were under pressure to buy from out of town, we did it in a three day blitz. When we were more local, we did it over a few months. Once it became available, we studied zillow, trulia, and realtor.com obsessively. Zillow can show you all nearby sales, price/sq ft, prices of what's on the market now, virtually EVERYTHING you need to know. The only thing that zillow and trulia cannot tell you is what the condition of a recently sold home was at the time of sale. But a good local realtor can tell you that, because they were in it when it was on the market. So, by looking at the comps from zillow, and going through the comps with the realtor, you should be able to get an idea of what the house is currently worth, without the issue of the non-working fireplace. This has absolutely NOTHING to do with the asking price. It's like when you go to buy a car. You don't negotiate down from the sticker price. You do your research, figure out what it actually cost the dealer, then try to get it for as close to that price as possible.

Now, you have to adjust for the fatal flaw of the non-working fireplace. It's too much of a project to fix, so the only option is living with it. Know that when you go to sell the house, you have to disclose this to potential buyers in the disclosures sheet. This alone may drive many buyers away. Your pool of buyers will be limited to those who don't care about a fireplace. It's going to take longer to sell the house. It will probably sell for less than it would be worth without this fatal flaw. I would honestly say that this fatal flaw would make me drop my offer by 10% of what I think the house is worth. Any realtor would scream to hear me say this, but the fact is, now that the flaw is known, the current seller has to disclose it to any potential buyers, so they are also going to have more trouble selling the house now.

There will always be another house. We are only just coming out of a big buyers' market. It is not yet a sellers' market, although I believe that it may be, in another year or two. Are you willing to bargain hard on this house, and possibly lose it? If so, figure the value, drop it by 10%, make that offer and stand firm. Meanwhile, do your research, and look at every single house on the market in your area that could possibly suit you, so that you can expand your choices. And keep in mind that a lot of homes will likely be coming on the market very soon, because a lot of people who were sitting on the sidelines, waiting to list until the market had improved a little, will now go ahead and list for this spring market, which is beginning right now.

Good luck!
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Old 02-09-2013, 08:36 PM
 
Location: Grass Valley,CA.
1,113 posts, read 2,096,425 times
Reputation: 593
Quote:
Originally Posted by jazzerstacey View Post
My DH and I thank everyone for their comments.

We do have children; therefore, the idea of carbon monoxide fumes from a ventless fireplace make us nervous. They are banned in California and Massachusetts and although my Republican DH might not agree with those states on much, he does agree there.

I can't say with any certainty that the sellers knew. As one responder suggested, the opinion did come from an inspector. DH, however, is more skeptical.

So we need to weigh how much value is subtracted from a home with a sealed up fireplace and how much the sellers will compensate for that loss of value. As one other writer suggested, there will be other options for us, even though we do like many things about this one. We want to find a house before the next school year, so we do have time on our side. I'll certainty let you all know how we made out !
You're saying fireplaces are banned in California? Where did you hear that? I use mine every night!!
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Old 02-09-2013, 10:20 PM
 
Location: Connecticut
24,570 posts, read 40,120,453 times
Reputation: 6942
I think that the value some people are placing on the fireplace is a bit high. It is not going to be 10%. That would be $70,000. Lets be reasonable. You could add a fireplace for a lot less than that. I am thinking more like $10,000 or so. Maybe $15,000. Again your agent should have an idea. If they do not, then you might want to talk to a real estate appraiser. Jay
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Old 02-10-2013, 09:26 AM
 
3,325 posts, read 3,259,105 times
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Jay, the house has an unusable fireplace built into the central area of the house, not on an outside wall. They'd have to tear apart the house to fix it. The only comparison I can think of is a luxurious interior bathroom, built around a cracked enormous built in fancy jacuzzi tub, which cannot be replaced. Yes, you can just use the shower and put a plant in the jacuzzi. Or you could gut the entire bathroom, and maybe the finished basement underneath, and maybe the exterior wall, to get it out and replace it. But who would do this? Yes, I'd agree, if the fireplace were on the outside wall, that would be a simple fix. Or one could add a fireplace on an exterior wall. But this is right smack in the center of the house, requiring major house surgery to repair. The only other thing you can do is wall it up, sheetrock over it, pretend it wasn't there, and hope that the next person doesn't notice it. Actually, if possible, that's not a bad idea - sheetrock over it, and if desired, put a fireplace on an exterior wall somewhere. But my feeling is that having a visible central fireplace that is not usable significantly detracts from the value of the house.
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Old 02-10-2013, 09:47 AM
 
Location: Boydton, VA
2,093 posts, read 2,693,098 times
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1st off....I don't read where you say exactly what is wrong with the fireplace...what did the inspector see to cause him to tag it unusable ?

A firebox can be repaired.
The flue can be repaired as long as the exterior of the chimney is solid.

When moving to our farm, we needed to use the fireplace for our sole source of heat. Creosote built up over time and we had a chimney fire (in excess of 2K degrees) resulting in cracked and broken flue tiles...which can lead to burning down the entire home. A certified Chimney Sweep who specialized in restoration, placed a flexible flue pipe within the flue tiles, sealed the old flue above the existing damper, and filled the space between the old flue tiles and the new flexible flue with a non-combustible material. We then placed a Vermont Castings insert with a blower in the fireplace....and we had a system much better than the original.

Regards
Gemstone1
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