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I’m currently in the process of buying my first home. After a year of searching, I found what I thought would be a great home. The owner accepted my offer and agreed to pay part of the closing cost. I had a home inspection done and the inspection report came back with some major issues. One of the issues is the home needing a new roof. There are shingles missing in several areas, significant water damage in certain spots due to prior leaks and improper repairs, and wood rot in several areas. Also the siding in the front and right side of the home needs to be replaced due to poor maintenance, water damage and wood rot (that had been covered up with paint) The inspector also stated that the there are cracks in the chimney and the chimney is showing signs of separating from the house.. My realtor asked for a new roof and to replace the rotten wood areas, but the seller refused. He said the roof wasn’t currently leaking, so he’s not replacing it. He said he would replace some of the soffit and fascia and give $1000 toward other repairs. Also, the appraisal finally came back and was $4000 less than my offer. The inside of the home was updated within the last 10 years or so, but the owner has been using it as rental property for the past several years. The owner lives out of state and obviously hasn’t seen the property in a while. I have a few days left for negotiations, but I’m wondering if I should ask for a new price ( lower than the appraisal price) and take a chance on paying for repairs myself or just walk away all together. Any advice?
I’m currently in the process of buying my first home.
Any advice?
How many tens of thousands in CASH do you have in reserve?
Few first time buyers can handle properties with work to be done on them
Quote:
...the home needing a new roof.
...Also the siding in the front and right side of the home needs to be replaced
...the owner has been using it as rental property for the past several years.
If you have the cash to do these and the ten others you haven't identified...
these sorts of tasks are just that; tasks.
Quote:
The owner accepted my offer and agreed to pay part of the closing cost.
the appraisal finally came back and was $4000 less than my offer.
The biggest issue here is that you most likely won’t be able to get insurance on this, and possibly not even a loan depending what kind you’re going for (FHA, VA are more stringent).
I’m currently in the process of buying my first home. After a year of searching, I found what I thought would be a great home. The owner accepted my offer and agreed to pay part of the closing cost. I had a home inspection done and the inspection report came back with some major issues. One of the issues is the home needing a new roof. There are shingles missing in several areas, significant water damage in certain spots due to prior leaks and improper repairs, and wood rot in several areas. Also the siding in the front and right side of the home needs to be replaced due to poor maintenance, water damage and wood rot (that had been covered up with paint) The inspector also stated that the there are cracks in the chimney and the chimney is showing signs of separating from the house.. My realtor asked for a new roof and to replace the rotten wood areas, but the seller refused. He said the roof wasn’t currently leaking, so he’s not replacing it. He said he would replace some of the soffit and fascia and give $1000 toward other repairs. Also, the appraisal finally came back and was $4000 less than my offer. The inside of the home was updated within the last 10 years or so, but the owner has been using it as rental property for the past several years. The owner lives out of state and obviously hasn’t seen the property in a while. I have a few days left for negotiations, but I’m wondering if I should ask for a new price ( lower than the appraisal price) and take a chance on paying for repairs myself or just walk away all together. Any advice?
Key points above in bold with probably the most important that this is your first home and the appraisal value. The problems you are describing are only what can visibly be seen. What is beneath the visible damage and apparent lack of maintenance is yet to be seen. It's when you start repairing what you can see that you begin finding the latent (hidden) damage that can easily escalate to much greater costs.
Unless you are very handy with home repairs and know homes and/or have lots of money on the side for repairs and you have no other choices then it is most likely time to start looking again. You will never find a perfect home but you can find ones with much less issues and latent issues than what you are describing.
Since you're asking these questions, and since you're a first time home buyer, my sense is that you should walk away from this one. Buying a house in need of repairs can be a good strategy, but you should be looking at homes that just need cosmetic repairs. Once you delve into structural or other major repairs, you're really dealing with issues that can be quite expensive and should be best left to those with more experience.
Of course, none of us have seen the house, but those sound like some serious issues which could also underlie other significant problems with the house.
You are a first-timer and don't have a good sense of how much things cost. The fact that the seller was trying to hide things means you could have more surprises when you start getting into repair work. Inspectors can't see everything.
A house needing work is OK, and may be attractive to a buyer short on cash.
BUT a house with an urgent need for expensive repairs is another story. Some issues only get worse- maybe quickly- and will cost much more to repair later.
You need to make a judgement about which it is.
Usually offers have contingencies concerning mortgage and insurance. It is possible that the issues you note will make it impossible to get one or both. Make sure if you still think you want to go ahead.
I wouldn't buy it unless you have estimates on how much the repairs will cost and get the purchase price adjusted accordingly. However, no matter what the estimates are, 99.9% of the time you will run into additional problems once you start fixing things. If there are water damage problems, there also may be foundation issues and you may need gutters if there aren't any. If the house has maintenance issues for one thing, you can be sure there are other maintenance issues waiting to be discovered.
Since you're a first time home buyer, I wouldn't do it. If you were an experienced home owner, I still wouldn't do it without a significant cut in the price way above what they're offering.
Well, it depends on what knowledge and skills you have.
When I went to buy my first house, I had years of experience in living in old houses and repairing them (under the guidance of my step father). Nothing I was going to see was likely to scare me, as people in my neighborhood growing up, and especially in my family, would have pulled their fingernails out with rusty pliers before they would default to "calling a professional". No one around me had that kind of money. We fixed it ourselves, and we called someone in if it started to look like requiring heavy equipment we couldn't figure out a way to rent or borrow. My stepfather and I and a guy from his work put the roof on our house, for example. It didn't look so good, but it never leaked.
On the other hand, if you grew up in a family where they thought a "complete tool kit" consisted of an old Phillips screwdriver with a buggered-up tip, a pair of pliers, and a tack hammer, and where they called a "professional" every time the toilet got clogged or a faucet started dripping, then you had better not make your first experience of house ownership one that involves any kind of heavy repairs.
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