Overcoming Buyer's Anxiety
Recently, I have had several occasions where my clients who were buying a home expressed serious concerns over aging building components or systems. There was nothing wrong with the items at the time of inspection, mind you, but you could see the fear in their eyes.
For example, I informed a particular client about the age of a roof (20 years old) and that while it was not leaking, there was likely not a lot of years left until it would need to be replaced. I did not report it as a "defect", because it was functional. My client was really concerned about the replacement cost, to the point that she wanted the seller to pay $3,000 towards a new roof. The real estate agent told me that she believed that the buyer might "bail" if she did not get these funds. Was my client being realistic? Its all about people's tolerance for risk.
With any older home, you have to expect that replacement parts for equipment or items like doors and windows will be hard to come by, and a replacement will likely be needed in the not-so-distant future. I tell clients that they need to recognize that unless they are buying a new home with a home warranty (required for new construction in NJ), then they can expect to be budgeting for replacement of older items. At that point, I get two questions; "How much longer will it last?" and "How much will it cost?"
Of course, I cannot answer these questions accurately - if I could, I'd have a wonderful career as a stock broker of weatherman. The only things we know for certain is that (a) the older something is, the more likely it is to fail from wear and tear, and (b) the cost is dependent on what contractor you select. Its all about RISK - what your risk tolerence is. coupled with the cost to replace or repair something that is getting towards the end of its "service life".
Bottom line? If you are risk-averse, buy something newer, or see about a home warranty. Home inspectors perform visual inspections according to the New jersey Standards of Practice, and unfortunately other than having experience with many properties like the one you are buying, we are no better than being able to predict imminent failure than your car mechanic. Awareness of the possible pitfalls is about all we can offer - you need to determine your risk tolerance.
For example, I informed a particular client about the age of a roof (20 years old) and that while it was not leaking, there was likely not a lot of years left until it would need to be replaced. I did not report it as a "defect", because it was functional. My client was really concerned about the replacement cost, to the point that she wanted the seller to pay $3,000 towards a new roof. The real estate agent told me that she believed that the buyer might "bail" if she did not get these funds. Was my client being realistic? Its all about people's tolerance for risk.
With any older home, you have to expect that replacement parts for equipment or items like doors and windows will be hard to come by, and a replacement will likely be needed in the not-so-distant future. I tell clients that they need to recognize that unless they are buying a new home with a home warranty (required for new construction in NJ), then they can expect to be budgeting for replacement of older items. At that point, I get two questions; "How much longer will it last?" and "How much will it cost?"
Of course, I cannot answer these questions accurately - if I could, I'd have a wonderful career as a stock broker of weatherman. The only things we know for certain is that (a) the older something is, the more likely it is to fail from wear and tear, and (b) the cost is dependent on what contractor you select. Its all about RISK - what your risk tolerence is. coupled with the cost to replace or repair something that is getting towards the end of its "service life".
Bottom line? If you are risk-averse, buy something newer, or see about a home warranty. Home inspectors perform visual inspections according to the New jersey Standards of Practice, and unfortunately other than having experience with many properties like the one you are buying, we are no better than being able to predict imminent failure than your car mechanic. Awareness of the possible pitfalls is about all we can offer - you need to determine your risk tolerance.
posted by Zack | 3:31 PM
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