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Do you realize that even if the mold problem is "remediated" you will likely need to disclose the presence of mold if and when you go to sell? Most people will run from a house that has had toxic mold.
I didn't know this - I thought that if something had been remediated, then there would no longer be anything to disclose. Is this a mold specific requirement?
Regardless, I would not consider a house with mold unless it was discounted to the price of an empty lot. Because I would be tearing it down.
I appreciate everyone's helpful comments and I'm repping all answers, whether I like them or not.
One thing to keep in mind is that my question is "how much should I pay" not "should I walk away?"
Even if this house is an absolute teardown because of the mold issue, and I should pay the value of the land minus the cost to raze the structure, tell me that rather than to walk.
Quote:
Originally Posted by jackmichigan
Do you realize that even if the mold problem is "remediated" you will likely need to disclose the presence of mold if and when you go to sell? Most people will run from a house that has had toxic mold.
I don't think that's true. If I have mold analysis done and it comes back clear, why would I have to disclose that the house once had mold? Do you disclose that the roof once had a leak if you're selling a house where you replaced the roof, or that the water heater used to be 30 years old before you replaced it?
I don't intend to resell the house, but I recognize that my tune might change in 5-10 years due to circumstances beyond my control. What the comments here are telling me is that I should really hammer the seller on price, due to mold and rodent issues, even though they're already well below appraisal and comps.
Don't make this more complicated than it needs to be.
You have found a house which appeals to you.
The house has a couple of issues which will detract from its salability.
You have a budget which brings in you into this house somewhere around 10% lower than the current asking price.
That pretty much accurate?
So, you weigh the cost of living in a house that had a mold problem, and living in a house that had a water problem. Both of those items can be fixed, and will be fixed by the seller before you close a deal, correct?
So, bid them down ten percent from their asking, with the proviso that they repair the mold and water issues.
It is really that simple. The parameters within which you can operate are well defined. They fix the problems; you have a budget.
If it comes together , it comes together. If it doesn't (i.e., the seller won't fix the mold/water issues; or, it sells above your budget, what can you do about it?), then you move along.
Don't let emotion, dreams, wishes, what if's, or other soft factors get in the way of your making a sound business decision.
What are the laws in your area on disclosure? If you live in a non-disclosure state, then the fact that the house once had mold will not affect future sales price. People are right that toxic mold will scare off most buyers, but I'm of the opinion (after doing some research) that the toxic mold scare is overhyped. Then again, I have no allergies and have never had any kind of chronic sinus or respiratory problems. Even the annual pine tree pollen apocalypse that we have in this area every spring doesn't seem to affect me. If I had asthma, I might be a little more reluctant to buy a home with mold issues, but as things stand, if I were in a position where I had found the one and only home that I could possibly hope to afford in my dream neighborhood, I'd buy it with the contingency that the mold issue be remediated before I move in. I might even specify a short list of acceptable remediators, so the buyer doesn't try to cut corners.
As for price, I'd go ahead and make the -10% offer. The fact that people are so touchy about mold works in your favor right now. The homeowner is probably even freaked out about it. I would not be offended by a -10% offer on my home. If I didn't find it acceptable and was reluctant to move off my asking price, I'd just make a counteroffer of something much closer to asking to get the message across to the buyer. And if these people have already moved out, they are probably not that emotionally attached to the home anymore.
I don't think that's true. If I have mold analysis done and it comes back clear, why would I have to disclose that the house once had mold?
I should have more correctly stated that disclosure of previous mold conditions "may" be required. Of course, disclosure requirements vary by state and even by municipality. In Michigan, there are disclosure requirements mandated by the state, but counties and municipalities can impose greater disclosure requirements. The state requires that certain previous conditions (e.g. wet basement) be disclosed, regardless of whether it may have been corrected. I only brought it up because what you may need to disclose--and how that might limit future buyers--may impact what you are willing to pay for the property.
As for % of list price which is okay to offer, people ask that question all of the time. There's really no way to say without knowing the property and local market--and the motivations of the Seller. The list price may or may not reflect market conditions or Seller motivation. I'm presently working on submitting an offer which will be about 60% of the original list price. It's not a "low-ball" offer; it's just reflective of the circumstances.
I'm of the opinion (after doing some research) that the toxic mold scare is overhyped.
There are some legitimate health issues, especially for people with allergies. But many people would be completely fine. As someone who is VERY sensitive to mold, spending an extended period of time in a house with toxic mold is unbearable. I lived in a home with mold for 6 months - and it felt like a severe case of strep throat. Spending everyday with a throat so sore that you cannot swallow is really not a lot of fun. I doubt it would've killed me, but it is not a scenario I would ever willingly live in again. Luckily that was a living with a boyfriend situation years ago and when the relationship fell apart, the mold was not my problem.
Even today, when looking at homes, I can usually guess if there is dampness in the basement before even going downstairs because my throat will begin to tighten.
So there's no rule of thumb regarding larger houses in the same neighborhood having lower $/sqft than smaller houses?
As long as the lot size, finishes, and neighborhoods are roughly comparable, I believe you will find the rough trend you've mentioned: $/sq ft declines somewhat with the size of the house. I think this is because every house needs at least one kitchen and one bathroom and (usually) one garage no matter how large. The proportionate cost of these expensive rooms is greater with a smaller house, hence the higher, in general, price/sq ft. But this is a very rough rule of thumb -- I'm sure the agents on this forum will correct me if I'm wrong!
WRT the mold issue: I think Starla has it right. A lot of the panic over mold (and its cousins radon and asbestos) is generated by the industry that has grown up to remediate these conditions, usually very expensively. If I were considering an offer on a property with known mold issues, I'd require the seller to remediate the condition before escrow close and contingent upon an acceptable inspection BY AN INSPECTOR I HIRE. If you have to sell the property in the future, have it tested and have the docs showing that it has passed inspection available for buyers.
If you won't even consider walking away, how in the world do you expect this to be a good deal??
I would walk away in Escrow if my contingencies weren't satisfied, or if my independent inspections come back with more serious problems and the sellers won't work with me. I haven't made an offer yet, and the remediation hasn't happened, so it's too early to walk away, unless I decide to never-ever consider any house with warts. That would mean that I should be buying new construction, and that is not the type of property that matches my location and budget requirements.
This is in California, by the way.
What I am going to do, based on input from this forum, is look up disclosure laws in this state and try to understand the impact of the mold on future sale of the house, so I can factor that into my asking price. I'm also going to make sure that I get a guarantee, or at least communications with the remediation company, to satisfy me that this issue has been resolved. So thank you for those great suggestions!
I also appreciate the debate over the impact of mold. I am concerned about my family's health, but we have lived with unknown types of mold (found on windows and hard surfaces and "self-remediated") before. I am more worried about the kiss of death any positive mold analysis gives to a home, and making sure that I factor that into the offer price.
Also... how big of an issue are rodents in the basement? Is it even possible to exterminate and seal against them, or can I plan on this being a long-term issue, too?
There are some legitimate health issues, especially for people with allergies. But many people would be completely fine. As someone who is VERY sensitive to mold, spending an extended period of time in a house with toxic mold is unbearable. I lived in a home with mold for 6 months - and it felt like a severe case of strep throat. Spending everyday with a throat so sore that you cannot swallow is really not a lot of fun. I doubt it would've killed me, but it is not a scenario I would ever willingly live in again. Luckily that was a living with a boyfriend situation years ago and when the relationship fell apart, the mold was not my problem.
Even today, when looking at homes, I can usually guess if there is dampness in the basement before even going downstairs because my throat will begin to tighten.
It can kill you or make you wish you were dead.
I moved into a house with no mold smell. 2 weeks later I was in the ER with angina-edema. I spent months in pain, with my face swelling, my joints swelling, my thyroid shut down and I developed Hashimoto's, my cholesterol went over 300.
Turns out there was a plumbing leak in the walls and there was toxic black mold.
I am forever altered. I cannot be near mold, I cannot eat vinegar, nuts, wheat or over ripe food. I have anaphylactic symptoms. It is a blast. :/
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