Congratulations! Your home is under contract. But it’s not clear sailing yet.
Immediately after you and the buyer agree to the terms of purchase and all parties have signed the contract, you typically enter an “option period.” The option period is a span of time in which the buyer has an unrestricted right to terminate the contract for any reason so long as proper and timely notice is provided to you, the seller.
This is the homebuyer’s opportunity to conduct any due diligence necessary before moving forward with the home purchase. During this period -- often 7 to 10 days – the buyer usually has the home inspected to determine if there are any underlying issues (roofing, plumbing, electric, etc.) that could affect the price of the home. Based on what is discovered during the inspection, the buyer may ask the seller to make repairs or renegotiate the sales price of the home.
No home is perfect.
You should expect that the inspection may reveal minor or major issues that need to be addressed. The key is how the results of the inspection are addressed.
Based on our 23+ years of experience selling Central Austin homes, we’ve found that buyers often ask for the same types of solutions following their inspection. They either seek to (1) re-negotiate the price, and/or (2) have the seller make repairs. This is a normal part of the real estate transaction. Here’s what you should expect:
First, buyers may seek to re-negotiate the price
Even if the inspection reveals relatively few problems in your home, the buyer may look for tiny things that are wrong to justify a re-negotiation of the purchase price. Some buyers may even offer a higher purchase price initially to get the home under contract with the idea of renegotiating the price during the option period. And others look at this as an opportunity to have the seller help defray the cost of remodeling an outdated home.
Don’t take this personally. The buyer is simply trying to find “bottom” and ensure they are purchasing the property for the best price possible.
Even better, we have a solution to eliminate these re-negotiation tactics which we share with you at the end of this article.
Second, buyers may ask the seller to make repairs
In lieu of (or sometimes in addition to) re-negotiating the price, buyers may ask the seller to make certain repairs to address the issues in the inspection. Depending on the severity of the issue, this can be a costly request.
For example, our charming but quirky older homes in Central Austin often have plumbing issues. It may be that the home needs a new water heater, which would be a smaller $1500-1700 repair. On the other hand, if the home has cast iron plumbing leaks, the repair would be more in the range of $25,000 - $40,000. For the curious, you can check out our other article about the common issues with Central Austin homes.
So how do we avoid all this deal turbulence?
Get your home pre-inspected.
It’s our standard operating procedure to have all homes pre-inspected before they go on the market. Essentially you hire and pay for a professional home inspector to conduct a full inspection and prepare a written report on the condition of the interior and exterior of the home. Prices vary depending on the size of the home, but this usually costs around $400 - 800.
Having your home pre-inspected accomplishes several things. First off, the pre-inspection will let you know if there are any underlying issues with your home. Then you have the choice of either fixing the problem before you put it on the market or adjusting the price of your home accordingly.
Second, we recommend providing potential buyers with a copy of the home inspection before the home is under contract. Since the buyer was fully informed about the condition of the home before they put in their purchase offer, this reduces the likelihood that the buyer will come back and attempt to re-negotiate the purchase price based on the outcome of their own inspection.
At Homesville Real Estate we use proven strategies like this to ensure you have a smooth real estate transaction that earns you top-dollar. We’re happy to visit with you more about our effective techniques for getting your home sold. Just click HERE to schedule a free, no obligation consult with our owner and broker, Paul Reddam.
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