You got inspections done and now what. Who pays for the repairs?
To begin, you need to focus on the health and safety items, as well as those that can erode the condition of the property. Those items would be “Pest inspection” items that are considered to be “Active infestation”, which means there is a live organism that is deteriorating the property. These are often water related items such as dry rot, fungus, or mold. These should be corrected to protect your asset and your health. These items can be handled either prior to the close of escrow or be budgeted to be completed soon after you take possession.
In all transactions, most everything is negotiable as long as you haven’t signed away any “inspection contingencies”. In most cases, a request to correct the items will be initiated by the buyer for the seller to fix specified items and pay for the repairs. The seller will consider the request and determine if the request fits with their expectations of the sale.
But what happens if the request for the seller to fix the items isn’t successful? The best advice for this article is for you to discuss this with your real estate agent and refer back to the purchase agreement. However, having said that there is usually a solution,but in a minority of the time there is not and the deal falls apart.
There are items that will show up on the property inspection report which are normally less likely to be negotiated. A property inspector may identify everything from a sink plug that is inoperable to significant structural issues. The significance of each item will be determined by your level of concern with the failed item. However, the seller will weigh in on how significant they feel it is and whether they believe it is warranted to be repaired or replaced during the escrow period.
While there are items like plumbing and electrical that can be a health and safety item, many other concerns for a buyer may be the age of the equipment such as a furnace, air conditioner, water heater or the roof. While these items may be old, they are still functioning and in the seller’s mind do not need to be replaced at this time, and may last for many years, depending upon maintenance. In most cases, the minor items like the sink plug, mentioned above, would not be negotiated by the buyer and their focus would be on the larger items. For the items that are not immediate concerns the buyer should budget for a future replacement of that equipment or adjust their offer price accordingly.