Case Study: Why Sellers Should Pre-Inspect Before Listing

I’ve recently been involved in a transaction that illustrates why sellers should pre-inspect their homes before listing them.

I represented the buyer in the transaction.

The property was one of only a few suitable listings I found prior to my buyers’ visit.

My buyers’ offer was accepted, I opened escrow, and ordered the home inspection.

The home inspection revealed so much water in the crawlspace that the inspector said “it felt like I was on a waterbed when I crawled over the vapor barrier”.

The inspection also revealed a filthy furnace, marginal remaining roof life, faulty gas fireplace, and other issues.

My buyer opted to terminate the contract after reviewing two inspection reports; one of which included a bid for $4,600 to fix the crawlspace moisture problem.

The bottom line?

My buyers drove 2,400 miles round-trip and returned home without having bought a home.

Their trip was a total waste of time and they will need to return again when I find more homes to show them.

The sellers, who had already closed on another home, now get to unexpectedly spend thousands of dollars to fix problems while they continue to make double payments.

All of this could easily have been avoided with a pre-inspection and upfront repairs.

If you’re a seller, have your home pre-inspected before you list it!

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Phil Hoover is a licensed independent Idaho real estate broker, assisting both buyers and sellers in Boise Idaho, Meridian Idaho, and Eagle Idaho.

During his 45 years of full-time real estate experience, Phil has helped thousands of past clients buy and sell quality properties in the Western U.S.

Phil is one of only ten local Realtors® (of nearly 5,500) honored with the coveted “Realtor® Emeritus” award from the National Association of Realtors®, recognizing 40 years in real estate.

 

Boise Homes: Home Security

I have an upcoming listing that reminds me of the importance of securing a home by changing the garage keypad code.

There are a lot of Boise homes that have had the same garage keypad code since they were brand-new!

This particular home is owned by out-of-state sellers and has been rented twice since they moved out of area.

The last tenant moved out last week and the property manager doesn’t know the garage keypad code.

That means the last tenant, and perhaps the previous tenant, could still access the house.

There’s also the possibility that various friends/neighbors of the tenants could have the garage code too.

I wouldn’t be surprised if the code is still the same one my seller used years ago!

That probably wouldn’t be a problem in this situation, but imagine a scenario where a tenant leaves on bad terms with the owner (unpaid rent, cost of repairs taken out of the tenant’s deposit, etc.)

So, I will be going to the house today to re-program the garage code keypad.

Re-programming a garage keypad code is relatively simple with most garage door openers.

Most of them have a “learn” button on the back of the garage door opener.

You simply press that button until the light on the unit blinks, then you have 30 seconds to type in a new code on the keypad and press “enter”.

Be sure to test the new code after you’ve changed it to make sure it works.

Tip of the Day:

When you type in the new code, try to be more original than using “0000” or “1234”.

Those codes exist for most of the garage keypads in the Boise real estate market. 

 

Boise Homes: Delivering Clear Title

Delivering clear title is often an issue with divorcing sellers.

I’m currently involved in a buyer-represented transaction that includes a listing and Seller’s Property Disclosure signed only by the husband.

While doing my own informal title search before writing my buyer’s offer, I discovered the name of a female with a different last name who was also “on title” (another legal owner) for the subject property.

When I questioned the listing agent, I was told that both people were on title, had since divorced, and it was “no problem”.

I don’t know about you, but there’s something about those words that cause me to assume that the opposite could be true.

This is an obvious issue of the seller not having clear title.

This situation puts my buyers in the position of having an offer that had been accepted by only one of the two legal owners as we prepare to spend $300 on a home inspection tomorrow.

When I questioned the validity of the accepted offer yesterday, both the listing agent and the escrow officer told me that the sellers are on good terms, and that the ex-wife will sign a quitclaim deed at closing relinquishing her interest in the property.

I would prefer that the ex-wife sign the quitclaim deed now; not at closing, because situations like this provide the opportunity for an unhappy ex-wife to renegotiate the terms of the divorce by holding up the closing.

But, I can’t require the ex-wife to do that.

This will probably all work out okay, but it could’ve been avoided by having the ex-wife sign and record a quitclaim deed as part of the divorce proceedings.

The situation was likely caused by a do-it-yourself divorce, or perhaps the attorney(s) missed it during the divorce proceedings.

 

Case Study: The Cash Offer That Failed

I received an all-cash offer on one of my high-end listings last week.

While reviewing the offer before presenting it to my seller, I was surprised to notice that the buyer was asking for $2,000 of seller-paid buyer closing costs.

Why in the world would an all-cash buyer need help with their closing costs?

This unusual request caused me to read the fine print in the Purchase and Sale Agreement, which stated:

Upon closing SELLER agrees to pay up to EITHER _____% (N/A if left blank) of the purchase price OR $2,000 (N/A if left blank) of lender-approved BUYER’S closing costs, lender fees, and prepaid costs which includes but is not limited to those items in BUYER columns marked below.

Since it was an all-cash offer, there weren’t any lender-approved buyer’s closing costs or lender fees. And, the buyer’s agent had marked only the tax service and flood certification fee for buyer’s closing costs; neither of which would apply with an all-cash offer.

That left only one-half of a $700 escrow fee for the buyer’s closing costs.

So, we countered that the price was acceptable with the buyer to pay their own closing costs.

The buyer walked.

During my conversations with the buyer’s agent, I learned that the buyer was from out-of-state, had viewed 35 homes, and lowballed another listing by $30,000.

I’m guessing there’s more to this story than I will probably ever know.

 

Case Study: Finding A Home With A Shop

I am currently working with buyers who want to buy a home with a large (ideally 30’ X 40’) shop, on small acreage or a large lot, near Boise.

My buyers have pre-approved financing and are ready to buy.

Criteria for the home includes at least 1,800 square feet, 3-4 bedrooms, good surrounding area, within 10-15 miles of the Boise airport area, up to $225,000.

It’s okay if the house needs some work, but it can’t be a candidate for demolition.

Criteria for the shop includes adequate size for two or three Dodge Sprinter delivery vans, power, and water.

There are currently 20 listings in MLS matching that general criteria.

Over the past 10 days, I have researched, driven by, and/or previewed all of them.

Many of them were misrepresented in the MLS listings and had storage sheds; not shops.

Yesterday, I showed my buyers the two properties that made the cut for showing after my extensive research.

Both properties were in poor condition, overpriced, and located on major roads with heavy traffic and road noise.

I have also researched existing homes for the possibility of buying a home and building a shop afterward, but have been stymied by both zoning laws and CCRs prohibiting shops on properties.

After a lot of digging, I did find a nice home in the City of Meridian with an adjoining ¼-acre lot that initially appeared to be a viable situation for my buyers.

But, that’s where it gets interesting because the home is in the City of Meridian and the rear ¼-acre lot remains in Ada County with unclear zoning laws.

That’s because the rear ¼-acre rear lot includes a community well for the adjoining subdivision (not annexed to the City of Meridian) and thus was probably never intended to be buildable.

I have asked Ada County Planning & Zoning to tell me if a shop could be built on the 1/4-acre lot, but I’m not expecting a positive response for a variety of reasons.

This has been a huge learning experience for both my buyers and myself.

Properties like this are extremely difficult to find! 🙁