It goes without saying that nobody wants to purchase a money pit and spend a fortune on repairs. But, sometimes, the best deals are those that require a bit of legwork and some sacrifices. Anyhow, they are not finished until two sides are satisfied, the money changes hands, and the deed is transferred.
So, who is supposed to take care of repairs? Well, they are always up to negotiations and there are no definite answers here. What is worth noting is that when people dig in their heels and forgo flexibility, repairs can bust deals and shatter homeownership dreams.
Bringing issues to light
Issues in this department tend to arise after a home inspection. They can lead to another round of negotiations that involves the talks about credits and fixes. Namely, professional inspectors, agents, or even buyers themselves can discover some problems that have been either neglected or deliberately swept under the carpet. In both cases, they are a major hurdle in negotiations.
Faced with this kind of predicament, buyers have a few options before them. It is possible to ask the
seller to fix things or to negotiate the price down. The former situation occurred when I decided to carry out roof repairs in Sydney and told the buyer he would have to cover them in the end. He did not take it well, but I knew I had leverage because he was desperate to sell the home quickly.
It is only natural to want your home to look picture-perfect and systems to work like a charm. But, at the same time, buyers should be careful not to alienate sellers. They are already on their way out and often reluctant to undergo repair and renovation projects. At the very least, they are less enthusiastic about the repairs and certainly do not consider them a top priority as buyers do.
So, the two sides can be worlds apart when it comes to the matter of repairs. Still, what usually happens is a compromise. The best chances for this outcome happen when both sides are flexible and keep their options and eyes wide open. This is not to say, for example, that the home buyers should turn a blind eye on faults and defects.
Of course, it is fine to be prepared to let the small issues slip. They will be sorted out in the future when renovation takes place. However, there are some serious problems and red flags you cannot afford to ignore. Even when a seller completes repair projects, the buyer ought to take a closer look. This may involve some back-and-forth in case the property hunter is not satisfied with the work.
No hard rules
Real estate contracts differ from place to place. There could also be more than one standard form of contract in your area. Some buyers take a cash-back credit at the close of escrow and use that money to tackle repairs, but this is not a common practice everywhere. In any regard, it is advisable to read repair and inspection contingencies carefully. Signing a contract before that is a shot in the dark.
Contractual twists and turns
Ultimately, a contract can benefit a buyer and it can benefit a seller. One cannot expect both to be completely satisfied. Some contracts, for instance, define that a buyer is entitled to conduct an inspection, but is not allowed to request any repairs or credit (inspection is only for information purposes). Other documents allow them to define repairs they want the seller to take care of.
Playing within the limits
The key is to know your limits and leeway you possess during negotiations. Adhere to state laws, local customs, and specific conditions (financial or otherwise) in your case. Do not rely on gut instinct or solely on the report that the other party presents. Finally, bear in mind that the real estate brokers and attorneys can be of great help. They can hammer out a deal that brings benefits to both sides.
A joint effort
Problems can come back and haunt buyers after the deal is closed, which they want to avoid at all cost. On the other hand, sellers are certainly not over the moon with spending more money on property they are about to let go of. There’s no one-size-fits-all standard for solving repair issues. It is clear that buyers and seller must work hand in hand to bridge the negotiating and find common ground. Otherwise, the deal is dead in the water.