Author Topic: Home Buying Negotiation Advice  (Read 1343 times)

change_seeker

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Home Buying Negotiation Advice
« on: March 28, 2018, 03:14:07 PM »
We are in the final steps of a home purchase in Reno, NV.  Reno is a very hot market right now, most properties are going under contract in a handful of days.

Here are the basics on the home including a link to our decision process that led to this home:

$525k list
Originally offered $495k based on agent's comps, they countered at $519k.  We looked at a bunch of other houses, and then circled back to this one after making offers on several others.  Offered $510k, they accepted.  Currently awaiting appraisal.
1950 sq ft
1 acre lot
Built 1979
Needs nothing right away*famous last words
In an awesome neighborhood with public land, MTB and hiking trails nearby.  My wife grew up in Reno and this is her dream area.
18 mile bike commute, will require e-bike or multi-modal
On the same end of town as our family

I forgot to mention that it is on a well and septic system (this will be important later!)

Since then, we have received an appraisal for $510k and gone through all the inspections.

Home inspection revealed a significant amount of sand and sediment when the bathtub was run.
Home inspection revealed a number of items which the seller has declined to address (missing roof tiles, shoddily repaired garage door, microbial growth in attic & crawlspace).  Probably $2500 to have contractor fix.
Well inspection could not be completed because the sand caused the pressure to spike during the flow test.
Septic inspection revealed that the leach line was not accepting waste.
16' of leach line replaced, septic inspection now passes.
New submersible pump installed in well, pump level raised 20', flow restrictor installed on pump inlet.  $7500, paid by seller.
Well inspection completed.
Three plumbers brought out to try and remove sediment from plumbing and fixtures inside the home.  I spoke to the last plumber, there was still sand coming out of the tub when he left yesterday.
Sediment filter being installed today.  This is a back-purging valve and stainless steel valve.
Received quote for $12500 from well company to connect to municipal water (there is a meter by the mailbox).  Not sure why the seller didn't pursue this option first...
The plumbing in the house is allegedly working now, but I'm sure the water heater and all fixtures will experience a reduction in life due to the sand that was run through them.


We are going out to the property tonight to check things out.

The original closing date was today.  We have signed an addendum to extend to this Friday.

My question:

How should I approach negotiation?  My initial response is to ask them to reduce the purchase price by $12500, as I have no guarantee that the problem has been resolved.  We probably have $2000 into inspections, etc.

@Axecleaver

honeybbq

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Re: Home Buying Negotiation Advice
« Reply #1 on: March 28, 2018, 03:32:16 PM »
I've always just asked for everything to be fix per the inspection report... Which would include a subsequent well inspection and a resolution of this sand problem.

Of course, they can decline, and then you have to figure out what to do. I prefer for THEM to fix because if they find something ELSE in the midst of the repair, it ain't your problem.


mm1970

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Re: Home Buying Negotiation Advice
« Reply #2 on: March 28, 2018, 03:53:54 PM »
Depends on how hot the market is.  If they think they can sell it for $510k as is, they may tell you to pound sand.

My old officemate sold her last house "as is".

change_seeker

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Re: Home Buying Negotiation Advice
« Reply #3 on: March 28, 2018, 05:44:08 PM »
...they may tell you to pound sand.

I see what you did there ;)

affordablehousing

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Re: Home Buying Negotiation Advice
« Reply #4 on: March 28, 2018, 08:27:01 PM »
You sound like a very astute buyer. If that's true, and you think there's a chance that a less astute buyer could come along and save the seller some money by not getting anxious, it may make sense to be more accepting, otherwise you could insist on them connecting to municipal, or work out a credit for half the connection cost and see if you need to do that in the short term or the long term. Using a company more in tune with plumbing than a specialty well company might get a better price anyway on the work, and you'll have time to evaluate more bids. That way, $6250 might be more than half the cost.

Sure others have said this but it sounds like a great home, and some repairs in the context of getting what you want, even major like this, aren't going to make the house less special when you look back on happy years spent there.

Axecleaver

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Re: Home Buying Negotiation Advice
« Reply #5 on: March 29, 2018, 06:42:49 PM »
They have already made the well repair, and if they put it back up for sale, could find another buyer pretty fast, I bet. That linits your power. I'd consider letting it go then replacing fixtures as they fail. I would Purge the hw heater (can do this yourself) first thing and not worry too much about other fixtures like dishwashers. Asking for a different fix after you asked for well repiar seems like a bridge too far and you're risking the deal in a hot market.

BeanCounter

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Re: Home Buying Negotiation Advice
« Reply #6 on: March 29, 2018, 06:52:42 PM »
As a seller, I flat out refuse to do repairs for a buyer. Iíve offered money as part of a deal to help with repairs, but Iím not going to fix it. I feel that the inspection is so that the buyers can determine what if anything could be problematic now or in the future. The buyer can then determine how or if they want to deal with it. Th seller doesnít owe the buyer a perfect house.

change_seeker

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Re: Home Buying Negotiation Advice
« Reply #7 on: March 31, 2018, 09:26:21 AM »
Thanks @BeanCounter @Axecleaver @affordablehousing @mm1970 @honeybbq .

We went ahead with the deal and closed yesterday.  It will be the middle of April before we move in as we agreed to rent back to the seller for two weeks.  We will spend that time scouring Craigslist for deals on furniture and appliances.  We purged a LOT of furniture when we moved out of our last house a year ago.

I'm trying to think about setting up the house from a functional perspective.

We want to do X.
The best space inside or outside of the house to do X is Y.
We need to accomplish Z to update Y for X.