Given the expense that comes with moving to a new home, it’s not surprising that you’re reluctant to pour money into the house you’re leaving behind. After all, you’ve learned to live with the toilet handle that needs jiggling and the electrical outlet that hasn’t worked in a decade. The new buyers will just have to accept your home’s quirks.
They probably won’t. In fact, those minor (and sometimes major) repair issues you’ve tolerated can deter buyers from making an offer or even result in a low appraisal which can kill the deal.
The last thing you want is for repair issues to land your home back on the market. According to Nathan Dart, a Maryland real estate agent that ranks among the Top 1% of Realtors Nationwide, “If we’re back on the market because we have these repair issues, every other buyer that comes in to buy our property will want these issues addressed.”
Deals falling through due to repair and appraisal issues happens more often than you might think. In their December 2016 Confidence Index, the National Association of Realtors reports that 23 percent of property sales fell through due to the home inspection and environmental issues.
Another 14 percent fell through due to appraisal issues. That’s a total of 37 percent of terminated sales likely related to a repair issue that the seller could have addressed prior to listing the property.
In many states, you’re actually required by law to notify potential buyers of repair issues, and they’ll likely ask that you make the repairs before the sale goes through. The same holds true even for those repairs you don’t know you need. Once you’ve accepted an offer, your buyer is going hire a home inspector who will find any number of repair or maintenance issues. The buyer will then ask that you either make those repairs or take a lower offer.
It’s important to note that making a lower offer isn’t always an option for your buyer. As Dart explains, “Buyers with typical FHA Loans, where they’re putting the minimum amount of money down, have less funds available to do the fix-ups.” These buyers are looking for move-in ready properties so they can fold repair costs into their mortgage rather than paying out of pocket for the repairs.
If you don’t want to lose a whole pool of potential buyers, it’s best to make sure your home’s bones are in tip-top shape.
The question is: What repairs do you absolutely need to make before you list your house?
Watch this video to find out:
What to Fix Before You Sell Your House:
The Must-Fix List
No two houses are alike, whether yours is one-of-a-kind or part of a cookie-cutter development. This means your home is going to have its own unique set of repair issues to address. So how do you find the repair issues that might tank your home’s sale?
The answer: investigate the common problem areas encountered by home inspectors. According to Realtor Magazine, these problem areas are: Faulty wiring, poor grading and drainage, roof problems, foundation problems, poor upkeep, faulty plumbing, and HVAC issues.
1. Faulty Wiring
Electrical problems are of huge concern as they lead to over 51,000 electrical fires a year. Solutions to electrical issues run the gamut from simple, inexpensive fixes to costly, major rewiring. According to Fixr.com, the cost of rewiring a 1,200 sq. ft. home averages over $10,000. Luckily, this is almost never a requirement. Even homes built with less-than-safe aluminum wiring during the 1960s and ‘70s are grandfathered into current code and don’t need to be replaced.
Chances are any electrical work you’ll need will be on the smaller scale, such as missing wire nuts, open or damaged junction boxes, frayed wiring, and faulty light switches or outlets. These can be fixed by a qualified electrician, which Fixr.com advises will run you an average of $65 to $85 per hour, plus the cost of materials.
Another costly electrical repair you might run into is if your circuit breaker doesn’t meet the amperage needs of your home. The National Association of Realtors advises 100 amps, however, larger homes may need a 200 amp circuit breaker. Angie’s List reports that replacing your circuit breaker could cost anywhere from $500 to over $2000.
2. Poor Grading and Drainage
In the simplest terms, grading and drainage refers to how water, such as from rain or melting snow, is directed away from your home. This encompasses rain gutters, down spouts, and how your lawn subtly slopes to direct water flow toward street gutters.
Clogged rain gutters, downspouts that don’t direct water away from the house, water stains in the basement, and spongy soil around your foundation are all signs that you’ve got issues in this area that need to be addressed. These fixes could be as simple as cleaning your gutters to adding downspout extensions and gutter screens to prevent clogs. If your drainage problems are caused by a poorly sloped yard, you’ll have to consider regrading your lawn – a project that costs an average of $1,600 up to $4,500.
If you haven’t taken a look at your grading and drainage situation in a while, there’s a chance poor drainage has led to more serious issues with your roof or your foundation.
3. Roof Problems
Clogged storm gutters cause water running off your roof to back up and collect along the edges. This can lead water damage to your shingles and wood rot in your fascia boards. Your roof can sustain other damage as well, such as curled shingles caused by sun damage, storms tearing roofing off in spots, or damaged flashings around vent openings. If you leave this damage unfixed for too long, you’ll wind up needing a new roof.
Depending on your type of roofing, a brand new roof can cost anywhere from $4,000 to $17,000, according to Fixr.com. However, if you’ve got a little water leaking into your home during rainstorms, don’t automatically assume you need a brand new roof. In all likelihood, you can fix your roof issues by replacing damaged weather stripping and shingles, which Fixr.com says will cost you an average of $600 for a qualified roofer and materials.
4. Foundation Problems
Improper drainage around your home’s exterior is one of several causes that can lead to foundation issues, both minor and severe. If you’re lucky, your home’s foundation issues will be minor, caused by the natural settling of a home over time. Basic repairs to a foundation can still be pricy, with filling a single crack ringing in between $800 to $1,500 according to the Foundation Repair Network. And that’s not including additional costs, such as slabjacking and the fees of a structural engineer to assess the damage.
If your home has severe foundation problems, chances are you’ve already seen signs of the damage. Some signs of foundation problems include: noticeably slanted floors, windows and doors that don’t close properly, cracks in your interior walls, gaps above cabinets, and visible cracks in the exterior foundation. Worst case scenarios end up paying over $10,000 or more, and these repairs are vital. A severely damaged foundation threatens the structural integrity of the whole home, which can make it almost impossible to sell if not repaired.
5. Poor Upkeep
Peeling paint, worn out carpeting, damaged tiles, cracked pavement – these cosmetic issues may seem minor, but there is a chance they may cause your sale to fall through. This is especially true if your buyer has an FHA loan, as HUD has a higher standard of appraisal over conventional loans.
Giving your home a mini-facelift also has the added bonus of making your property more appealing to buyers. The first cosmetic fixes to consider a fresh coat of paint and replace the carpeting if it’s more than five to seven years old. You should also fix any minor damage, such as replacing broken tiles and securing loose handrails.
If your kitchen and bathrooms are older, you can give them an updated look with a few inexpensive upgrades, including new light fixtures, faucets, and cabinet pulls. Don’t spend more than a few hundred dollars on updates to make your home more attractive though, as it’s unlikely that you’ll see a return on that investment. As realtor Nathan Dart says, “These updates add to the sizzle, but not to the steak. Buyers may be attracted to the property because it has cosmetic updates, but they’re not necessarily going to pay more money for them.”
6. Faulty Plumbing
If you’ve got water leaking into your home and it isn’t storming outside, then you’ve probably got a plumbing problem. And if you’ve got a plumbing problem, you’re going to have water damage. Water damage is of particular concern because dampness can lead to larger issues, including mold and dry rot. Costs to repair water damage depends upon a variety of factors, including the source of the water, the size of the damaged area, and how long the damage has gone unnoticed.
Apart from water damage, plumbing issues range from minor repairs, such as leaks around faucets or toilets, to damaged pipes that need replacing. Some leaks can be fixed rather inexpensively by replacing worn out parts, such as a faucet’s washers or a toilet’s wax ring. More complex problems, such as snaking clogged drains or replacing pipes, require the services of a licensed plumber which costs between $70 to $125 per hour.
7. Heating, Ventilation and Air-Conditioning Issues
“You can’t sell in the dead of winter a house with a heater that doesn’t work,” says realtor Nathan Dart, which is why it’s so important to make sure your HVAC system is in proper working condition. A new HVAC unit can cost you anywhere from $4,000 to $11,000, including installation, so this is an expense you want to avoid if you can.
If your system is running inefficiently or isn’t currently working, that doesn’t necessarily mean you need a new one. A qualified technician may be able to make repairs to your HVAC unit. Just be prepared for the expense, as you’ll pay a flat rate for the service call, plus additional fees for any repairs or parts needed.
Aside from the ventilation provided by your HVAC unit, your home likely has additional ventilation. This includes kitchen and bathroom fans, as well as soffit vents in your attic to prevent overheating. If a home inspection denotes poor ventilation as an issue, this may be solved with additional ventilation in your attic, or simply clearing your existing vents of any blockages.
When in Doubt, Ask Your Real Estate Agent What to Fix Before Selling a House
Now that you know what to look for, how do you go about spotting these problems on your own home? Unless the problem is obvious, chances are your untrained eye won’t be able to find all your repair needs. One way to find out for sure is to have a pre-inspection done on your home, so you can fix the major issues before listing the property.
Once you’ve received your inspection report, it’s best to review the findings with your realtor. With their knowledge of the current market and experience evaluating home inspection reports, an agent is well equipped to advise you on which repairs should be completed before listing your home and which ones can be folded into the sale.
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