I know at times during inspections I can seem a bit... nitpicky. It may even feel overbearing at times, but there's good reason behind that. I'll tell you why it pays to be patient and go through process.
What do you think it would cost to repair a little damage to the floors in the picture above? You may even be asking, "WHAT damage?!" Here's a closer look:
A client is in escrow on this home. It will be an rental property in a great part of McCormick Ranch (Scottsdale) with good schools that commands a premium. After reviewing the seller disclosures and inspections, we determined there were 2 roof claims on the CLUE Report (from the insurance policy)- one for the shingle roof & the other for the flat roof (which needed to be replaced); fortunately we determined the shingle roof was OK AND still under warranty after requesting more detail from the insurance company. The termite report showed active infestation & damage to laminate plank floors in hallway. We thought we could repair the boards inexpensively with a few leftover replacement planks the seller had (4, to be exact).
- 12/9/15- On a visit, it became a little obvious that if we tiled the area in the hallway, it may not match the adjacent bath or laundry room. The hallway also ran into a nearby 4th BR/office, the living & dining rooms and kitchen. Yikes! If we tiled, we might need to change the baseboards if the tile couldn't be installed under the baseboards. Wood sounded nice and may have been a little easier, but would have been more expensive.
- 12/10/15- The seller determined he didn't have enough boards.
- 12/15/15- a wood flooring contractor determined that he could probably repair the floors and quoted $250 for up to 4 boards and $65/ea additional board.
- At some point... Insurance determined they couldn't match the few replacement boards. With that option out, the actual replacement costs became critical. We had a tile contractor come to measure the floors and give an estimate. The seller did the same.
- 12/16/15- I send a tile contractor out to measure the floors and give an estimate.
- 12/17/15- Our tile contractor gave a bid that came in at $3400 for install (labor) & haul-away of trash, but did NOT include the tile (materials)! He estimated the area he was looking at to be ~900SF. At a minimum to not get completely cheap tile that wouldn't at least be comparable to the laminate-wood floors, we estimated about $2/SF for tile (~$1800)- a total cost of $5200!
- 12/18/15- Buyer makes a judgement call on how to proceed.
- 12/21/16- The seller asked if he sweetened the opt and threw in another $1000 whether the buyer would tackle all the repairs himself. Hmmm...
- 12/23/15- The seller's estimate from the insurance company's estimate came in at over $12000 and included the termite treatment, floors, baseboards, etc.!
If you found yourself in that situation, what would you have done on 12/15? If we had stopped right there with the info we had, how do you think that would have worked out for my buyer?
What do you think the buyer finally opted to do? If you guessed, take a $2K less reduction and have insurance do it, you're right. We signed the response to the inspection notice on 12/20/15. He will have most of the house refloored AND is paying below market for a great income-producing rental!
The bottom line... what we thought was an easy $250 repair will really cost $12K!
It pays to be patient and take the time to estimate needed repairs to make wise decisions when negotiating the sale of a home.
Ironically, yesterday I got an email from an insurance agent asking why I was requesting so much info about a FIRE that had occurred in one unit of an 8-plex that another client is in escrow on... This little flooring repair pales in comparison to all the issues we've found in the multi-family building...
Numbers don't lie and being too hasty can cost you. It goes both ways- both buyers AND sellers should always be diligent! It's just part of the service I offer ALL my clients so they're happy at the end of the road!
December 2015 Phoenix Metro Real Estate Snapshot
The Best Phoenix Metro Zip Codes to Sell a $1M+ Home in November 2015