It’s a Saturday and you’re driving out to a house to meet someone about buying their used bike. You read about it online, looked at the 3 photos of it, talked to the owner and arranged a time to take a look and possibly purchase it.
You get there and do your quick inspection, take it for a 30 second drive down the street. Noticing that the one tire is going flat, the front handle bars are crooked and there is rust just above the pedals, you decide to buy it anyways. How hard could it be to fix that stuff? The owner wants $75. You offer $50 and end up settling at $62.
You agree to come back with your van in an hour to pick it up. In good faith, you shake hands and leave the seller with $30 to hold the bike.
An hour later, right on schedule, you arrive to pick up your beloved bicycle. But there’s just one thing…
You are now only willing to pay them $50 instead of the $62 because of that faulty tire, crooked handle bars and rusted frame. “But we had a deal?” says the seller.
In this case, the seller is correct.
If you came to an agreement on the bike based on what you saw (ie: flat tire, crooked handle bars and rusted frame), turning around and flip-flopping could be viewed as dodgy.
If you came back to pick up the bike with your friend, the cycling guru, who discovered a cracked rim, well then, that is a different conversation. That is new information that would negatively affect your ability to use and enjoy the bike. Otherwise the time to negotiate for the flat tire, crooked handle bars and rusted frame was back when you made the original deal and those faults were staring you and the seller in the face.
So what is the real estate equivalent? We call it the “Post Inspection Re-Negotiation”.
A buyer views a home, is told about the roof that needs replacing, the 45 year old furnace and the leaky toilet. They proceed to make an offer which is accepted. They then have a home inspection and ask for an $11,000 adjustment to replace the roof, the furnace and the toilet despite the fact that these were all known issues and clearly visible during their initial site visits.
The function of a home inspection is to uncover or locate issues that are otherwise not visible. For example, vermiculite insulation in the attic, knob and tube wiring on the 2nd floor, a roof leak, faulty electrical work or a possibly cracked heat exchanger in the furnace. These would all be items that were unknown to the purchaser at the point of making the offer.
We have seen this method of negotiating sour a deal and occasionally derail the whole thing.
Have a competent, experienced REALTOR® spend the time to show you the home. Negotiating and getting it right the first time is always the better route to take. After many years in this business involving hundreds of transactions, we have seen the results from both sides of the equation and the post inspection re-negotiation approach leads to bad feelings and poor decisions.
If you’re looking for an experienced perspective and trained eye whether selling or buying, feel free to contact us at anytime.
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