What is the Point of Disclosing an Old Roof or Anything Else?

I was in a CE class the other day and the broker teaching said he requires all sellers to have an inspection prior to listing the house!  Not going to stop buyer's from asking for the moon and/or lowballing but it does get everything out on the table prior to negotiations.

Angela,

What makes even less sense when they back out is that they've already spent a couple of hundred dollars for the inspection. Especially when it deals with something they already know from the disclosure.

Rich

Angela,

I'm in hurricane country and what we find here is during this phase of negotiation and home inspection, the buyers will start investigating insurance quotes. Many of our insurers will give a discount if the roof is less than 5 years old. In fact, some houses will only qualify for "regular" insurance if the roof is new or newer. Otherwise, they may have to use what's called the "beach pool" insurance that's significantly higher. So a non-issue suddenly becomes an issue.

Great comments, but let's not let ourselves completely off the hook here. As buyers agents, it's our job to educate and advise. Especially on a disclosed item, we have no business advising our clients to comtinue to push when we should already know when the price has been "adjusted". And if we don't know the price has been adjusted, it just tells me that we didn't do our job prior to the offer! Doing things the right way won't stop the occasional goofy buyer from asking for the stars after getting the moon, but....Thanks for the post!

Hello Angela...Great blog,

Some people are smarter than they appear, and we should believe they will know what looks bad. Sorry you and all agents have to bout it out with sellers and buyer in the, like one earlier comment said, 'let's make a deal'. As an Inspector, I will evaluate and recommend future actions with the houses' components.  I have seen things that are in really bad conditions, mostly due to wear and age.  If the roof has not shown signs of water intrusion, I will not tell you the roof needs replacing now, no-matter how bad it looks, but I will recommend that it will need replacing in the near future. Some roof and major components can survive well beyond the recommend life expectancy, so many factors can play into how long.  When it's integrity fails then you will have the leaking, that you don't want and perhaps that would be your legitimate cause for the client to have the roof replaced.

"Take care of your home and your home will take care of you"

Angela  It is a sign of the times - people make offers, counter offers, ridiculous demands in their effort to "get a deal"  Fortunately, people who do not need to sell are also too sophisticated to fall into the trap

When my sellers have accepted a "rock-bottom-line-no-more-room-for-negotiations" point, I recommend putting on the counter offer : "Home sold as-in with no additional repairs or concessions by seller."

The buyer may then conduct his inspection and decide to go forward or quit now.  (No other choices!)

Angela ~

In North Texas the Roof Condition is a Big Issue for Insurability.  If the buyer is financing, the home has to be insurable.  If the roof isn't insurable, then the seller either fixes the roof or gets a cash buyer.

You can't close and fund a loan if there isn't insurance.

Because of the ongoing Roof Hail Claims, insurance companies want to insure a home with a roof that has 5 or more years of life left.   Most people get their roof replaced due to an insurance claim.  No, I take that back - last summer I watched the windstorms come thru my neighborhood and literally peel the shingles off like frisbees landing in yards. 

My home isn't insured by St. Farm - It's "State Farm LLoyds" because of all the roof claims.  

So the sellers disclosure says "age of roof approx 9 yrs".  To the buyer that means nothing - are they 15, 20, 30 year rated shingles? I am a Realtor, not a roofer.   Get the house under contract and get an inspection and then if needed get a roofer inspection.  Get a CLUE report and see when it had a roof claim and if it was PAID did they actually get a new roof installed or pocket the insurance check.

The Texas contract is pretty clear.  Buyer accepts the home in current condition and has XX number of days to termiate for ANY reason.  During this termination option time you get the inspection done and if needed renegotate the contract a 2nd time with an executed contract amendment stating specific repairs and/or price reduction.  If you don't come to an agreement by the end or the termination option period either the buyer terminates or lives with the contract.

My advice is to get to know 2 reputable area roofers and utilize their advice accordingly.

Angela,

Sometimes people in this price range fight over the most minute things...And buyers /sellers "firends" can be the worst influence.

As an Inspector I have to ask, why wasn't the roof replaced before the listing or while it was on the market? This would have eliminated all the bickering back and forth. The inspector did his job by calling out the roof. Did you tell the potential buyer that the price of the home was being offered with a discount for the new roof? I think this would have gone a long way in putting the buyers mind at ease. From the buyers view point, I shouldn't have to deal with getting a new roof installed, after all I am spending a lot on the house already. Just another view point. 

I've seen the same thing with foreclosures being sold "As Is."  Buyers seem to disregard that as well.

Definitely sounds like a buyer and seller education issue. Both sides need to be told much of what has been said in these comments PRIOR to writing a purchase offer. When I was an agent way back in ancient days, I always made sure my sellers understood that they should get rid of their emotionalism about the house and regard it as a pure business negotiation. No need to get personally insulted by the offer/counter off process.

I'm surprised that if the roofs are this bad, how are the buyers getting financing? I would think the roofs would need to be replaced/repaired prior to closing... at least in my market.

Angela, this really is one of my pet peeves. I price things according to condition, etc. But then this happens. Like it was a big huge surprise, NOT. It's like after the inspections some huge monster is awakened inside of some people.... go figure!

Angela, great post.  I really do think a lot of buyer's are drinking the "everyone is on the brink of foreclosure" kool-aid and therefore I can renegotiate as many times as I want.  I just went though one very similar to that we finally closed in August and that is because I ponied up a portion of my commission since we were 4 days from closing.  By the way my buyer did not get a housewarming gift!   Especially since he didn't thank me for the money I lost and he was the one that was changing everything every 5 minutes.   The seller on the other hand was very gracious.  To answer any questions on this YES I went over with the buyer EVERY time how much the seller dropped the price, already repaired, oh yes is paying a portion of your closing costs...this buyer was just greedy.  The reason I ponied up some commission was the buyer said we don't care if we lose the money for inspections (they had 2) , earnest money, appraisal etc you can always find us another house...can we say NO WAY!  I didn't even put my usual sold by sign in the yard.  I didn't want to really see them again.   Sorry I got on a rant the would is still raw LOL

I think comment #1 sums it up very well.  Buyers are convinced that they can ask for anything and sellers will be so desperate that they'll sell.  However, I think it goes to the seller to say "No".  If enough sellers push back or can get multiple offers, the demands placed by buyers will diminish.

My personal belief is that a disclosure and as-is addendum in an offer means the buyer will take it without askign the buyer to make any improvements.  If would be great if we could get a lawsuit in the sellers favor indicating that buyers who accept at home as-is in the offer and with sufficient disclosure (inspections are essential) that they be locked into the sale.  It's too easy for buyers to simply change their mind.  The end result is that sellers lose value because the listing is then tainted (i.e. people ask why the buyer backed out - they think something it wrong.

And then there was a time when the Sellers would not and did not have to do a thing and the Buyers were overbidding and outbidding competitors!  Oh, what an interesting field we are in!