Which Repairs
Should You Make Before the Sale?
By Courtney Ronan
If you're preparing to place your home on the
market, it's inevitable that you'll need a couple
of minor repairs and slight improvements before
your broker can drive a "For Sale" sign
into your front yard.
Practical and aesthetic projects like a fresh
coat of paint drain neither time nor money and
can make your home more attractive while perhaps
speeding your sale.
But what if a larger item needs repair, something
which doesn't jeopardize anyone's health or safety
-- a problem of the "out of sight, out of
mind" variety. Should you simply disclose
it and leave the buyer to deal with the problem?
Or should you fix it before placing your home
on the market?
Before you make any decisions, consider that
repairing the problem yourself could result in
a potentially higher sales price for you. What
sweet music it is to any buyer's ears to hear
the terms "new" or "just replaced"
as they walk through a home.
Neal Hribar with Coldwell Banker in San Diego
says, "If your house is in move-in condition,
it will appeal to a wider group of prospective
home buyers. First-time home buyers, and buyers
with busy lifestyles, often will not consider
buying a home that needs a lot of work. That is
because they do not have the time or the experience
to deal with the problems.
"The listings that command the most attention
are those that are in the best condition,"
Hribar explains. "If homes look sharp and
are priced right, more than one buyer may make
an offer. When multiple offers occur, the price
may get bid up. Even if there are not multiple
offers, experience has shown that a house that
is in good condition will sell more quickly than
one that needs work. A quick sale often means
that the sales price will be close to the list
price."
Another point to consider: Many if not most home
sales today include the use of a home inspection
clause. Depending on how it's written, this clause
can allow buyers to terminate a contract if the
inspection is not "satisfactory" to
them or if certain repairs are not completed.
According to the online legal resource Nolo.com,
buyers often have the opportunity with a proper
inspection clause to effectively re-open negotiations
by either asking the owner to undertake repairs.
Another result of an unhappy inspection works
like this: The buyer asks for a discount -- sometimes
a very ambitious discount based on an inflated
view of repair costs.
When considering minor aesthetic improvements,
your decision should depend on local market conditions.
Your broker can suggest what's needed to be competitive
and perhaps what's not. In a hot market you may
need to do nothing, while in a buyer's market
your list of repairs and upgrades may be extensive.
While not fixing up is a problem, fixing up too
much -- over-improving -- is also an issue. The
usual rule for buyers is that they purchase the
least expensive home in the most expensive neighborhood
they can afford. The result is that a house with
too many improvements may be priced at the top
of the local market, not the best place to be
from a selling standpoint.
The moral of the story: You have an obligation
to repair or at least inform buyers regarding
health and safety hazards. For their protection
--and to guard against unwarranted future claims
against you -- buyers should get a home inspection.
No less important, the longer a home languishes
in the marketplace, the more likely it is to fetch
a lower price. Thus fixing up is not only good
for buyers, it also may lead to a quicker sale
-- something beneficial for owners.
The Realty Times
Published: August 28, 2001
www.RealtyTimes.com
|
