Home inspections can cause issues for a seller.  Buyers will frequently have an item in their offer that covers the right to negotiate repairs to their satisfaction or a reduction of the contract price.

(NOTE: Agents should check for obvious signs of serious “Health and Safety” issues – mold, structural, obvious flaws – BEFORE the home is listed and counsel the prospective buyers on what their options are.)

Key Elements

What are the buyers asking for?

  1. Are the buyers asking for a reasonable option? The definition of “reasonable” frequently depends on the motivation level of the seller.  That will determine how much the seller will agree to repair and what they and their agent think the buyers will be willing to accept without repair.

If there are any “iffy” repairs, one solution is to offer a Home Warranty that would handle those items.

  1. What If the buyers have a lengthy “laundry list” that goes on and on?

Again, “reasonable” is a subjective term.  Sellers can play “the numbers game” by offering to fix some items, but not all.   It’s good to develop a LIST of each of the items that will be corrected – to illustrate the extent of the time and financial commitment for fixing problem. It may take some negotiating, but if the buyers have some sense of fairness, the back-and-forth should be handled quickly.

  1. Are the sellers willing to handle some repairs on their own?

Some items may be simple enough for the seller to easily fix – like paint or petty landscaping – like trimming trees or shrubs.  Those items should be agreed to quickly and these minor items done. 

  1. What can be done about BIG repairs? (Money talks!)

Avoid repairs or replacements about which buyers can have a subjective opinion.

A fixed amount of money is not subject to interpretation. Once accepted it eliminates the problem AND saves time (and even dollars) for the sellers.

Serious Issues

Some inspections may turn up a HUGE issue – furnace or air conditioning repairs are typical, but there are others.  Obviously mold or structural issues need to be addressed, and most buyers will demand that the sellers get those professionally done.  (Again – agents should check for obvious signs of these “Health and Safety” issues BEFORE the home is listed and counsel the prospective sellers on what their options are.)

There may be other issues that are not about life or health, but are projects that the sellers just don’t have the time or money to deal with – like removing an old propane tank from the basement or backyard, removing an unwanted above-ground swimming pool or major landscape changes.

Cash or Price Adjustment

Sellers may be able to negotiate a cash settlement that is less expensive than the actual cost of having the problem remedied.  The offer to the buyers should emphasize that THEY get to choose how the replacement/repair/change is completed instead of accepting something performed by the seller. The buyers can find this solution very attractive if the counter diplomatically points out that benefit.

Some examples:

  1. The seller’s furnace is on its last legs. The buyers want a new furnace. The best price the sellers can find is $3,900. The sellers offer to give the buyers $2,900 OR reduce the price for the home by that much – pointing out that the buyers could choose any type of furnace they wanted.

The buyers take the money and the seller saved $1,000.

The SHORT Version

  1. Fix any safety issues and big ticket items like the plumbing leaks, electrical repairs, roof repairs, Heating/Air Conditioning, mitigate radon and or mold, and complete any structural repairs.
  2. Avoid subjective repairs as the buyer and seller are almost guaranteed to not agree on the scope of work and cost which causes a stressful closing.
  3. Make sure everyone agrees on who is going to perform the work BEFORE any work is completed.
  4. Make sure both sides have closure when the deal closes. No one wants to deal with repairs after the deal is completed.
  5. What to do when a buyer terminates over the inspection. Share the inspection with the future buyers; let them decide what’s reasonable. Apply the reasonable person standard and make any repairs you think will be requested by the next buyer or anything the lender will likely wanted fixed so it can be financed.