Property looked great but is money pit
Q: This past July, I went to an open house. This housewas done to the nines (or so it appeared). I put in an offer thatweekend for the full list price and an escalation clause to ensure that Iwas in the running. My offerwas selected, and we proceeded with the home inspection and termite inspection.
Itwas difficult finding inspectorswhere this homewas located, so I was limited in whowould respond. The home inspectionwent fine. The inspector noted that there appeared to be mold in the crawl spaces thatwould have to be remediated. The shower in the basement didn’t drainwell, but that wasn’t of concern to him. And, he noted that the water heaterswould have to be replaced within five years.
We closed amonth later, before LaborDay weekend. We did our walk-through before closing without anything out of the ordinary other than awasp nest that had formed in the bedroom window.
Shortly after Imoved in, I called a plumber to adjust thewater temperatures on thewater heaters. Whenthe plumber came to adjust the temperatures, he noted that thewater heaterswere too old and that they had to be replaced if Iwanted hotwater. Also, our area has hardwater and a water softenerwould be needed to protect them. In addition, he found that therewas still cast-iron piping in the crawl space and itwas leaking sewage (the moldwasminimal and remediated, but it was in the crawl space and I didn’twant to undo
If a plumber tells homeowners to replace everything in a newly purchased home, they may want a second opinion. the remediation). snaking themwould not
I had him replace both work. Theywould have water heaters and the to be flushed out; but in cast-iron pipe and install doing that, they made the awater softener at a total situationworse. cost of around $20,000. A Is there any recourse I couple months later, I have to make the seller smelled an awful smell in responsible for these my kitchen, Iwent into repairs? Since he allegthe basement and found a edly spent a year fixing major sewage leak and this house thatwas in backup in the bathroom foreclosure, shouldn’t he and adjoining room. The have made sure that the plumber came out and pipeswere updated and found that all of the pipes clean (or cleaned out) were clogged and that prior to putting the house on the market?
My belief is that when you buy any house, you should repair fromthe bottom up and he evidently failed to do so.
A: Your house sounds like a money pit. We’re so sorry that you’re going through this, but the issues you raise are helpful in an era where home flipping has once again become sport.
It’s interesting that you started your story by stating that the home youwere buyingwas “done to the nines.” It’s so much easier (and cheaper) to paint (or paper) over a home’s flaws rather than address actual issues; and it seems to fool a lot of people, including professional home inspectors who should have known better.
When touring a house, Samusually likes to start in the basement. That’s how he can tell whether a seller put money into the guts of the home as opposed to just those areas that are visible, like the living roomor kitchen. It’s nice to have granite countertops and new appliances, and it’s also nice to have new bathroom fixtures and cabinets. But Sam likes to see whether a seller has tackled the mechanicals or structural issues, including replacing the air-conditioning system, hotwater heaters, pipes, windows, furnace, electrical supply, water supply, sanitary sewer line and other components that many other people overlook when buying a fixer-upper.
Some buyers seem to think that just because a seller is good at staging a home, they can automatically assume the mechanicals are up to date as well. But sellers have no obligation to update or renovate a home or do more than they are legally required to in the contract. If the hotwater heaters are old when you purchased the home, or the pipes are old, the seller has no obligation to update or upgrade them, just as you had no obligation to buy the home.
A good home inspector should turn every knob (including tub and sinks), test every light socket (to make sure it’s grounded), go into the crawl spaces and inspect the attic. An inspector doing a proper inspection should have told you that the hotwater wasn’tworking orwasn’t getting hot enough.
The other red flag is that you knew the homewas in foreclosure. Homes that go into foreclosure typically are owned by homeowners who can’t afford basic maintenance to the property. So everything falls to the wayside as they attempt to keep up with their mortgage payments. You should have been even more skeptical about the property upon finding out that itwas a foreclosure flip.
On the other hand, we sometimes find it suspicious when a plumber comes to a new home and automatically starts to tell the homeowners that they must replace everything. While thismay be true in some situations— like when you don’t have hot water— we also have seen some contractors abuse this situation. Maybe everything doesn’t really need to be replaced today.
Howwould you know? A second opinion. When Sam’s clients have gotten second opinions fromcontractors, it frequently turns out that the first contractor was trying to take advantage of the homeowner.
As far as going after the seller, we’re not sure what you can go after the seller for. You didn’t say that the seller lied to you or should have disclosed things that the seller knewwere wrong with the home.
Ilyce Glink is the CEO of BestMoneyMoves and Samuel J. Tamkin is a real estate attorney. Contact them through the website ThinkGlink.com.