<p>Hello, I am a long time lurker (son is well into his university career) who seeks the great collective wisdom here regarding a real estate issue. I was about to post a few months ago regarding a mid-life-should-I-move question but the answer was so obvious that I didnt need to. I am a very conservative person but I took the plunge and bought my perfect dream home in the new city, knowing that there is a very good market for homes in my current very desirable area. </p>
<p>However, a structural issue has turned up which the realtor (very experienced top agent locally) I consulted seems to believe makes my current home (which I own outright) unsaleable in a brisk sellers market. The repair would require consultation with a structural engineer followed by obtaining the services of a contractor. I live in an isolated region which is booming with industrial construction so that obtaining these services is just about impossible for a private individual. It could take years and my closing date is in 10 weeks. </p>
<p>I have a decent income with skills which are in great demand but cannot afford to own both places outright and because I will be considered self-employed after I move I dont know if I can get a mortgage.</p>
<p>I am desperate to leave here. Questions: Is a house really ever unsaleable? The issue is localized to the area around one stairwell of the house. All indications are that the foundation is fine. I am willing to accept a lower price. Would I be able to get an appraisal when the cost of repair is unknown? </p>
<p>I am making a list of contacts to start calling when business hours open but need to do something now so I appreciate your reading of this plea and any suggestions as I am not thinking really clearly right now and need to problem solve.</p>
<p>Thanks! The problem is obvious as the two walls on either side of the stairs have heaved upwards about two inches causing drywall cracks and other obvious signs of movement. A structural engineer from out of town did come by unofficially as a favor to a contractor I know when this happened previously. It is probably frost heave but the remedy is unclear. For once I thought I would be gutsy and go ahead with something with a bit of uncertainty…</p>
<p>If you can’t get a structural engineer out to inspect the stairwell, at the very least I would call an independant reputable home inspector and have him do an inspection, at your expense, and write up a report so you know what your are dealing with before you sign a listing agreement with any realtor. You will need to have your realtor disclose the “defective stairwell” in the disclosure packet, and list the property as for sale in “as is” condition, for probably a lower price than what a similar house in “perfect” condition would be listed at.</p>
<p>Can tell you 2 stories regarding structural problems (one positive and one negative):
Positive:
I have one relative who purchased a home (they were motivated buyers because of a new employment opportunity). This home had a leak through the ceiling in the living room from a plumbing problem. The seller did not fix it, and actually initially only offered $1000 for that repair. One knows that opening a ceiling, the unknown problem being repaired, closing the ceiling and repainting is going to cost just a bit more than that! The realtor worked to make this deal happen. I no longer recall all the particulars, but the deal was done, the seller dropped the purchase price enough for the buyers to take a risk on the property with the needed repair. The repair was completed and all went well.</p>
<p>Negative: I have another relative who sold a property. There was a home inspection prior to the purchase. There was a structural defect and the purchaser filed a law suit against the seller. The seller ended up losing a lot of money, because the buyer refused an early offered settlement, and seemed to have low cost representation, while the seller had to pay a lawyer a lot of money to defend this action. After the seller spent a lot of money with an attorney the buyer finally settled on the court house steps. This situation was a serious, and I do mean serious, financial loss to the seller besides it being stressful.</p>
<p>Thanks for all the input. Very kind and helpful people here. I am very mindful and thankful that this is “just real estate” and not a health problem but for me it is a huge disappointment as I have been waiting many many years to be free to make this move. I can get a home inspection but there is only one inspector available here who is not an engineer and will only report that an engineering inspection is needed. I am prepared to take a big loss on this but I cannot get my head around the idea that I cannot sell at any price.</p>
<p>Houses can be effectively unsaleable, especially in a soft market. As a friend of mine once said, when there is a buying frenzy going on, you have to overlook defects and shortcomings, but when the market cools and buyers can take their time…then even small shortcomings become serious reasons to take a pass and negotiate with someone whose home appears not to have such a problem.</p>
<p>Take a good look at the actual sales in your area recently vs asking prices and maybe vs tax assessments to get some realistic idea of what your house might bring. Then take a look at how long some homes have been on the market. Does your house have any compensating advantages like location or curb appeal that might tempt someone to overlook this issue? Maybe your realtor is focusing on this as a way to help persuade you to a more realistic asking price. </p>
<p>Generally speaking, we are in a falling market for real estate and I think there is an argument that what has happened so far is only a beginning. You don’t want to own two residences in a falling market. Also, once you vacate your home, your leverage in negoatiating will decline since it will be obvious to people that you must be carrying two places and need to sell the vacated one more urgently than someone still living there. Of course, it could make it more attractive to someone who wanted a quick move-in, but generally thats not the way things operate in that business.</p>
<p>You might want to consider renting the house out with an option to buy. You can make the option a generous one to entice a renter to close the deal.</p>
<p>wayupthere, is there any chance the house is in an industrial zone, and you could sell the property with the house being a tear-down? Just a thought…</p>
<p>I agree that the house might be very difficult to get rid of. If you can find a buyer, will the buyer be able to get homeowners insurance? They might not if there is a known structural issue. And without insurance, lenders won’t give a mortgage on it.</p>
<p>Could you rent the house, or do you need the money to purchase the new one? Maybe if you could rent it until you get the issue resolved, it would take some of the burden off?</p>
<p>First- I would try to get out of the contract to buy the other house, even if it means losing a few thousand dollars of the deposit. Assuming you at least have a mortgage contingency in your contract, you could simply let a mortgage denial bail you out of the contract.</p>
<p>Second- I would find a place to rent in the new place of work. I think it is a good idea to rent for the first year or so in a new place anyway.</p>
<p>Third- I would sell the old house “as is”, maybe as a tear down. </p>
<p>This may not be the smartest thing to do, but this is what <em>I</em> would do. I like to keep things simple and sleep well at night.</p>
<p>Anything can be sold, if the price is right (i.e. sufficiently discounted). However, not everything can be financed. It may be that a lender would not make a loan based on the condition of the property. Of course, I would not take a realtor’s word on it.</p>
<p>To see about financing, I think that it makes sense to have an appraisal for the land value, and an appraisal for the house. In my neighborhood there are plenty of very old homes, and with those you have all kinds of money pit surprises. They do sell, and they sell for a lot of money. The reason is that land value is very high, and new construction is extremely expensive.</p>
<p>cnp, it is for that reason that my relative who was sued, many thousands later was able to settle with the plaintiff. The plaintiff was really looking to make a killing on the home that he bought. The fact is that the land was much more valuable than the home. The home was not an old home, and was nice, but the land had much more value. If it had gone to trial, it is for that reason that the plaintiff would probably not walked out of much money even if they won their case. Still, it was a sad situation. I viewed it as the buyer trying to renegotiate their purchase price after the fact by using the court system as their vehicle. They had a home inspection before they purchased, so everything was done properly.</p>