What are reasonable requests after a home inspection? Are you asking for too much? Too little? What’s fair?
As a Buyer, the home inspection can be a nail-biter, but by the end of this post you’ll have the tools you need to determine exactly what’s fair when it comes to asking the Seller for repairs on your future home.
If this is your first time here, welcome! My name is Lindsay and I‘m a proud Anthem resident and your local REALTOR® with the Wise Move AZ Team at Realty ONE Group. We have a lot of fun talking about all things Anthem and real estate, and we would love to have you along for the ride. Did you know we share weekly videos on our YouTube Channel? Jump over there and hit that Subscribe button and the little bell icon to be notified when our new videos are released every single Thursday.
The Inspection Period
If you’re buying a home, the inspection period is an important and busy time! I have attended more home inspections and read more inspection reports than I can count, and I love it! You might be thinking, ‘Lindsay, are you crazy? Isn’t the inspection when the Buyer finds out everything that’s wrong with the house and the deal could fall apart?!’ That may be true but the way I see it, it’s also the time when the Buyer’s get to learn ALL about their home, and truly have the opportunity to decide if they’re going to ‘fall in love’ with it.
Up to this point the Buyer’s maybe had a couple of showings at the house, they’ve looked at surface level stuff and they like what they see. During the inspection, you get to learn about the inner workings of the home, how well its been cared for, and all kinds of other incredibly valuable information, including but not limited to what needs to be repaired. This opportunity to help Buyers look critically at the condition of the home and make life-changing decisions, is a part of my job that I am honored to do.
And let’s be honest, in all the home inspections I’ve ever attended, I’ve never had an inspector say, “the home is perfect, and nothing needs to be fixed”. I promise, if that happens, I will pick my jaw up off the floor and I will let you know!
What’s Next?
With all of that in mind, let’s assume that you aren’t buying a perfect home, and that you have a report from your inspectors with a list of items that need repair or attention. Now let’s get to the hard question, ‘what’s reasonable or fair to ask the Seller to fix?’
We have seven factors that we feel you need to consider. Also, as a bonus, at the end of this post, I’ll share the approach we take to negotiating repairs with the Seller that we have had so much success with.
I wish I had a clear-cut formula, but the truth of the matter is that we are dealing with human beings, and in many cases selling a home is an emotional decision. So, we want you to consider the following factors:
#1: What is the value of the home?
We know that for the Sellers their first question when they see your request for repairs is probably going to be ‘how much will all of this cost?’. The truth of the matter is that in most cases, the decision is going to come down to money for the Seller. If you’re buying a million-dollar home, $10,000 in repairs will be a lot less significant than asking for $10,000 in repairs on a $250,000 home, for example. There’s no clear-cut amount that is fair or unfair, but if you can think about the repair list in terms of dollars, compared to the value of the home, it may help to put things into perspective. You don’t want to ask for too much, and you also don’t want to nickel and dime the Seller over small things.
#2: What price did you pay for the home?
Did you pay fair market value for the home? Did you get a really good deal? Have you made a generous offer that may be slightly above fair market value because you HAD to lock down the house with mountain views? This can absolutely make a difference in what’s fair to ask for when it comes to repairs. If you’re paying less than fair market value, I recommend that you don’t ask for, or expect much by way of repairs. On the other hand, if you’re paying a fair market value, it’s typically not unreasonable to request that the Seller make a portion of the repairs.
#3: Is it an upgrade?
Look carefully at each item on your list. It is not reasonable to ask the Seller to make any upgrades to the home following the inspection, period! Let me give you a couple of examples of things that would be considered an upgrade. If the inspection reveals that the air conditioning units are old and may not have a lot of useful life left in them, it is NOT reasonable to ask the Seller for a new air conditioner. Additionally, if the inspection report reveals there are no carbon monoxide detectors in the home but it wasn’t mandatory to have carbon monoxide detectors at the time the home was built, it would be unreasonable to ask the Seller to bring the home up to the current code. Does that make sense?
#4: Is it aesthetic rather than functional?
As a general rule it is not fair or reasonable to ask the Seller to change something that is purely aesthetic. One example immediately comes to mind on this one, and can be a tricky one to navigate, is seals in windows. This might surprise you, but here in Arizona it gets hot, like really hot! So hot, that the seals in our windows can warp or buckle, and it’s not pretty. That being said, unless the seal actually breaks or there is moisture build-up in the windows, the window is still functional. If the window is still functional, but has ugly seals, it isn’t really fair to ask the Seller to replace the window.
#5: Is it a safety concern?
As a general rule, it is fair and reasonable to ask the Seller to repair something that is a health or safety concern. For example, if left untreated for long periods of time, termites in the home can be a safety concern. It is reasonable to ask the Seller to treat any active termites that are found.
What item are you most concerned about when it comes to your home inspection? Is it pests, the air conditioner, the roof, or something else? Let me know in the comments.
#6: Are you going to replace it?
Many times, Buyers have ideas of things that they plan to renovate or change when they move in to make the house their own. That’s the fun part, right? Typically, it’s not fair to ask the Seller to repair something that you are just going to get rid of or replace. For example, if the inspection notes that the bathtub faucet is leaking, but you have plans to do a bathroom remodel, don’t ask the Seller to fix the faucet. It’s just wasteful.
#7: What is the state of the market?
This last point is an important one. Are you currently in a Buyer’s market, a Seller’s Market, or a balanced market. We will be doing a video on this topic soon that breaks down the difference between buyers, sellers, and balanced markets, but for now, you just need to think about how much competition there was for you to get this home.
If the home had been sitting on the market for months and months, with little activity, before you put in an offer you may be able to ask for more in repairs. On the other hand, if you were in a multiple offer situation, or worse they have back up offers, I would keep your asks when it comes to repairs minimal.
As you can see from these seven factors, it is truly a balancing act trying to determine what’s fair, when it comes to asking for repairs after a home inspection.
Navigating the BINSR
As promised at the beginning of this post, I’m going to give you an explanation of what we do to successfully navigate this tricky part of the home buying process. Firstly, when we receive the inspection reports we sit down with our clients and go through every item, line by line. Then we ask our clients to make a list of any items, that if not fixed would make them walk away from the home. This means that if the Seller refused to fix that particular item, you would resume your search for a different home.
Then, once that list is completed, we ask our Buyers to identify any other items that are concerning to them and rank them in order of importance. Then, armed with this extremely valuable information we are able to negotiate with the Seller’s agent. The next key to our strategy is communicating with the Seller’s agent before writing up the BINSR.
If you’re thinking, what the heck is the BINSR then you’ll want to watch our video of BINSR tips for Buyers, which I will link to at the end of this post, so stick with me. Anyways, the long story short with the BINSR is that, in Arizona you really only have one shot to request repairs, and the Seller only has one opportunity to respond. That’s a lot of pressure! We can alleviate this pressure by coming to a verbal agreement before anything is put into writing, and keeping our buyers informed every step of the way. We’ve had a lot of success with this approach.
So, there you have it! What do you think? Are you ready to put together a fair and reasonable request after your home inspection?
More Resources
If you want to make sure you’re truly prepared for your inspection period then you’ll want to watch this video about what inspections to get when buying a home, or this video, which explains the BINSR process and gives tips for Buyers, just like you.
Enjoy those and I’ll see YOU next Thursday!
