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| Photo Credit: Art Explosion (edited) |
I always tell my home buyers to rate or prioritize the features they want and don't want to help them accurately assess the homes they look at but I'm here to tell you - put the following items on your RED Flag List.
According to HouseMaster (a home inspection company with offices in over 390 cities in United States or Canada), more than 40 percent of previously owned homes on the market have at least one serious defect.
"Virtually every 'used' home needs some repair or improvement," said Kathleen Kuhn, CEO and president of HouseMaster. "That's to be expected. But with today's high prices, you want to make sure that you are aware of any major problems in a house you are considering purchasing, and what it will take to remedy the situation."
Red Flag Defects
Thus, they have developed a list of serious home defects that YOU should be on the lookout for:
- Cracked heater exchange
- Failing air-conditioning compressor
- Environmental hazards including radon, water contamination, asbestos, lead paint, and underground storage tanks
- Moisture in the basement
- Defective roofing and/or flashings
- Insect infestation -- termites or carpenter ants
- Mixed plumbing
- Aluminum wiring
- Horizontal foundation cracks
- Major house settlement
- Undersized electrical system
- Chimney settling or separation
What does this mean for buyers?
House Master says that most of these issues can be repaired however the extent of the damage can range from minimal to substantial. The cost could invariably affect your desire to purchase the house (especially at the asking price!)
If you do decide to negotiate for a home and your home inspection reveals major problems, your agent or Realtor should advise you regarding provisions, negotiation and/or canceling the contract.
How should I proceed?
According to Realtor.com - if a home you are interested in buying does require repairs, there are several ways to proceed:
- The sellers can leave enough money in escrow to cover the cost of repairs, with instructions for the escrow officer to pay the contractors as the work is completed.
- The lender can withhold part of the full loan amount in a passbook savings account until the work has been done.
- The sellers may give a credit for the work. Lenders may disapprove of this last alternative because there aren't assurances that the repairs will be made.
The key to all of this is to make sure you hire a qualified and reputable home inspector. A home inspection can range from $250 to $400 (according to Realtor.com). Your agent should be able to recommend options or you can ask for referrals from friends.
Remember, you are hiring the home inspector even though you don't own the house yet so make sure that you are present during the inspection so he/she can explain what they notice. Be sure to ask questions including what you can expect in the future regarding what problems to look for and types of repairs. Some of these minor flaws or oddities may not warrant mention in the report but worth knowing.

Cal Ryan | Realtor | CalBRE#01259335
Lyon Real Estate | 1900 Grass Valley Hwy #100 | Auburn, CA 95603
Direct: 530-305-7566 | Fax: 530-878-1591

Get my free report | 9 Things that will LOWER A Home's Value
"Lyon Real Estate is ranked the number one brokerage in annual home sales in the Greater Sacramento Region." - the Sacramento Business Journal Book of Lists
This information is intended for informational purposes. There are no guarantees or promises expressed in this article. Always seek a real estate professional before making decisions about your personal home buying or selling needs.
| Cal Ryan | Realtor | CalBRE#01259335 Lyon Real Estate | 1900 Grass Valley Hwy #100 | Auburn, CA 95603 Direct: 530-305-7566 | Fax: 530-878-1591 Get my free report | 9 Things that will LOWER A Home's Value |
| "Lyon Real Estate is ranked the number one brokerage in annual home sales in the Greater Sacramento Region." - the Sacramento Business Journal Book of Lists |

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