Back To Active…No!
By Suzanne Gwilliam: Realtor
If you’ve been following the Real Estate market you’re sure to have seen a listing labeled as “Back to Active.” This term means that a listing formerly listed as “Pending” is now back on the market. This typically happens because the Buyer and Seller can’t agree on the repairs from the Home Inspection.
Imagine the typical Seller: they have lived in the property for several years and think they know what’s going on with it. The house isn’t perfect, but it’s not falling apart either! Now enters a Buyer with a Home Inspector.Know that the Home Inspector’s primary role is to find out what is wrong with your house. Upon reading the inspection report, the Seller’s fantasy that their house is Move In Ready has just been demolished! Most times, the Seller is aware of many of the things that the Home Inpsector finds, but they have just chosen to live with the imperfections.
Some of the most common issues that come up on a Home Inspection are windows with broken seals, non GFCI outlets where there should be protected outlets, and slow drains! None of these issues are earth shattering, but the Buyer will not want a house with broken window seals or regular outlets near the sink. Roof issues commonly come up because most people don’t climb on their roof to inspect the “deterioration of the rubberized membrane” around the chimney vents or flashing. Unless the roof is brand new, most sellers have no idea what’s going on up there. But believe me when I tell you that ALL Home Inspectors go up there and look and have the pictures to prove it!!
More often than not, the Seller is usually annoyed about all the “petty” things the Inspector finds. Worse yet, is when they are absolutely shocked by what is unearthed! Guess what? You will not be happy to hear that the Buyer wants most, if not EVERYTHING fixed. They are paying good money for your house and they are planning on buying new furniture once they move in, not a new roof!
It is here where the rubber meets the road! Sellers can refuse to fix things they don’t
see as important. So what if the window’s lock is broken! It’s 40 years old, for crying out loud! Or “No, I will not pay a plumber to inspect our drains because they are slow. Ever hear of Drano?” Another common response is that they flat out refuse to replace/repair big ticket items like pool equipment and uneven concrete, or the 30 year old roof, or the ancient heater/hvac systems, etc. Most Sellers assume that the Buyer took the old roof into consideration when placing the offer and that’s why they offered below asking price.
Some Sellers will try to give the Buyer money to fix the items themselves once they take possession of the house. Unless you allow countless contractors into your house to get estimates, the Buyer has no idea how much repairs cost. The Buyer will want top dollar just in case the drains can’t be cleaned and need to be replaced!! Not for nothing, but the Seller is usually going to pay the Buyer much more to fix the repair after settlement. It might have been cheaper to just do it themselves. Of course, one must take into account the luxury of not having to do repairs on the house, but it could cost you out the nose. It really just depends on the Seller’s bottom line and if spending a few extra hundred dollars is going to be worth the alleviated stress or not.
If the Buyer and Seller do not come to terms, if done within the time frame laid out in the contract, the Buyer can decide to move on and look for another property. If done according to the contract, the Buyer is entitled to their entire deposit. Experience shows that a Buyer will not think twice about losing $500 on the price of the Home Inspection if the alternative is putting on a new roof or replacing the heater. Bye-bye, baby! They are moving on to greener pastures.
So, where does that leave the Seller? Back to square one. They have to find a new Buyer. The days on the market have just been ticking away during the botched negotiations, so now, they usually need to do a price reduction to get Buyer #2. And then, to their immense joy, they have to go through the whole Home Inspection negotiating process again! And Buyer #2 is also going to hire a Home Inspector who will probably find all the same issues and then maybe more. Not to mention, that now that the Seller knows about the stuff found in the first inspection, they have to disclose that to the next Buyer.
So, bottom line is, unless the Buyer’s demands are just so totally unreasonable, I believe it’s in the Seller’s best interest to just try to work it through with Buyer #1 because Buyer #2 is going to find the same issues and offer you less money!! It’s a tough pill to swallow, but it is reality!