Top 5 Defects & Estimated Costs Your Clients Should Correct Before Listing Their Home
Undoubtedly, as a realtor, you are all too familiar with how frustrating it can be to have a contract fall through because of issues found during the buyer’s home inspection. Naturally, most buyers want a move-in ready home rather than incurring more upfront costs for home repairs. Conversely, most sellers want to list their home immediately and get the highest price possible. While we recognize that it’s not always possible to convince sellers to do vital repairs before listing their home, the following details and cost estimates may help you persuade them.
#1-What You Should Know About Federal Pacific and Zinsco Electrical Panels
Being familiar with these two types of electrical panels can save you and your client unexpected surprises. It doesn’t take an expert to realize that the electrical panel in a home is extremely important. As such you want to ensure it’s working properly before listing a home. Both the Federal Pacific and Zinsco electrical panels were routinely installed in older homes, causing red flags from home inspectors.
Federal Pacific Panels: This brand was quite common in homes built during the 1950s and 1980s. However, it wasn’t until the ‘80s era that this system was linked to thousands of fires. Homeowners with the FPE panels would often experience short circuiting and overload issues due to the system’s failure to automatically shut down. Even worse, when the breakers were manually shut off, electrical power flow would still continue coursing throughout the homes. These occurrences some times led to fires or other safety issues.
Zinsco Panels: Like the FPE panel, beginning in the 1950s, the Zinsco panels were also frequently installed in new builds up until the 1970s. This system poses a greater threat of fire because the circuit breakers would often malfunction and fail to trip, resulting in power surges or the bus bar melting. An important detail in recognizing this system is knowing that the Zinsco brand was eventually bought out by GTE-Sylvania. Regardless of which name is stamped on the panel, the risks are the same and should be replaced as soon as possible.
If a home inspector discovers either of these systems, as an industry standard it will be flagged every time, which may result in a new buyer being unable to obtain homeowners insurance. The cost to replace the defective system will range from $1500-$3700, based on whether or not the service line requires replacement as well. The main service line may require an upgrade in size to match the new electrical panel that is installed. The main service line is the thicker exterior electrical wire (usually gray) that connects the home to the utility lines.
#2-Recognizing Major Foundation Issues
When a home inspection report reveals foundation issues, it can send potential buyers running. However, certain issues are more cause for concern than others. For instance, a bowing foundation or horizontal cracks generally indicate major issues, while most vertical cracks are no big deal. Oftentimes, a home inspector will be able to determine which ones are structural and need to be corrected. The key here is being familiar with the different types of cracks.
Vertical Cracks: Foundation cracks running vertically, either straight up and down or less than 30-degrees diagonal commonly occur due to settling, especially during the initial few years after a new build. For aesthetic purposes, existing vertical cracks can be filled with special material to prevent further cracking.
Horizontal Cracks: These are usually the most severe, often signaling(some cases) major damage to the foundation’s structural integrity. Fortunately, these issues can sometimes be addressed WITHOUT replacing the entire foundation. One such example is installing pilaster beams or installing additional support beams that run parallel with the foundation. On the other hand, if severe damage requires a new foundation, then approximate repairs may cost approximately $600-$1100 per linear foot to replace sections of the foundation.
Diagonal Cracks: Cracks that run diagonally between 30 and 75 degrees usually develop for two reasons: 1) the settling of a foundation built on a slope or hill, or 2) changes in the underlying soil, either from over-saturation, or erosion, causing part of the foundation to move.
#3-Common Roof Issues on Older Homes
When it comes to spotting problems on the roof, a home inspector is trained to identify both existing and potential issues. However, a few telltale signs that can be seen with the naked eye include if there are missing shingles or overall looks of dilapidation, a full replacement may be in order. There are several factors involved regarding how extensive a roof repair/replacement may be, and of course the costs will vary widely too. Such elements that come into play include whether or not the roof is walkable, along with the roof height, type of shingles and how much replacement is involved, underlayment material, number of valleys, and the amount of flashing involved. Typically, your average 1600sqft – 2 story home with minimal valleys will cost approximately $4200-$7000, if the roof is walkable. The measurements/square ft coverage area of the roof is more important that the actual interior living space. We will get into the nitty gritty estimates below.
While this may be an unexpected expense for the seller, it’s much more cost effective to address roof repairs or replacement prior to listing the home. Not to mention the home will more likely sell faster and for a higher price.
Following are details of how roof replacement costs are configured. So, whether you have a trained eye or not, you’ll have the knowledge required to give your clients a reasonable estimate.
If you aren't a fan of crunching numbers - check out this roof estimating calculator.
Determine Roof Square Footage Cost: A good starting point is to determine how many “squares” are on a roof. Each 100 sq. ft. area consists of a 10 x 10 area. To estimate pricing for this, simply multiply the length and width roof measurements, then divide that number by 10. For example, if the total of length (30) x width (20) is 600, you have 600 sq. ft. so, 600/10=6 (10 x 10) squares. Using $400 per square as a baseline, the minimum cost is $2400. However, this doesn’t include the other variables like flashing, roof pitch, multiple valleys, and so on.
Cost for Additional Valleys: In the event a home has more than one valley, the additional cost is $50 for the 2nd, and $25 for each thereafter.
Extensive Roof Repair Fees: In the event the roof is not walkable, add an extra $75 per square foot. Other items such as flashing, underlayment, and plywood sheathing is priced on an individual basis depending on the amount of damage.
Once, you have determined the initial square footage, add one additional square to account for material waste, which puts the square footage from 600-700.
Again, the formula is: (Width x Length)/10 = Total # squares + 1 (for waste).
Referring back to the initial example and accounting for extra fees, a ballpark estimate would be $3675.
$400 per square
+$50 for additional valley
+$75 for non-walkable roof surface
=$525 per square x 7 squares=$3675.
Then, you’ll want to consider the best/worst case scenarios by offering a for a low/high range estimate. For an approximate low estimate subtract 10% ($3675-$367.50=$3291). For the high estimate add 25% ($3675+$918.75=$4593).
If you need help check out this roofing calculator - https://www.roofingcalc.com/
This formula is specific to roofs that are easily accessible and the shingles being removed are asphalt. Costs increase significantly with accessibility restrictions and where the removal of slate or clay shingles are involved.
Here is an example of roof measurements on a more complicated roof.
#4-Addressing Mold Problems
In recent years, mold has become a major topic of concern because of the health issues it imposes, as well as how damaging it can be to a structure. Mold thrives in warm, moist areas making attics and basements prime targets, and if a home inspector finds it, it is sure to get flagged. When this occurs, it’s best to encourage homeowners to address the problem prior to listing the house, to prevent the buyer’s home inspection from uncovering it.
Being proactive helps prevent rushed or missed deadlines due to delays in scheduling and completion of the mold remediation process. It’s not uncommon for mold remediation services to be booked 3-6 weeks out. Also, the actual cleaning time will fluctuate, depending on the complexity of the job.
Remediation costs are based on mold severity, accessibility, and the square footage of a home. To put this into perspective, attic remediation for this size house is estimated at $3000-$6000. The cost for mold remediation in a typical walkable basement of a 1600 sq. ft. home, that has no signs of flooding, water intrusion, or extensive moisture will cost approximately $2000-$3200. Again many factors come into plate when pricing a mold job such as: over all accessibility, ventilation requirements, floor building, vapor barriers etc.
#5-Dealing with Water in Basements
Basements can be highly desirable features in homes, but if water is present, it can lead to unpleasant odors, mold, and damaged furnishings, floors, and walls.
Common moisture problems may be caused from small cracks in the floor or walls, leaky pipes, or gaps in windows and doors. On the other hand, flooding or severe water intrusion in the basement are often the result of heavy rainfall, overflowing gutters, and foundation or landscaping issues. Bottom line, any moisture problems in basements should be rectified as soon as possible. A home inspector can help identify the underlying problem and offer guidance in finding a permanent solution.
Costs for this will depend on the cause of water entry, home square footage, and the amount of damage. Typically, basement water intrusion can be rectified with perimeter drains or what some industry professionals may refer to as “french drains”. Perimeter drains run around the interior basement perimeter. As water makes its way into the basement the water is directed to a pit that contains a sump pump. The sump pump then discharges the water to the exterior of the structure. The installation of a perimeter drain with a sump pump on a 2 Floor 1600 Sqft home costs around $4500-$7800.
Basement perimeter drains
As always consult with multiple specialists when a major issue is discovered. Contractor labor rates depend on many factors such as: the size of the company, overhead costs, the time of year you call them and how busy they are etc. As a company picks up volume there prices may increase. The lowest price bid is not always the worst company and the highest price bid is not always the best. Calling at least 3 contractors is always a good practice. You will get expert advice and 3 different opinions from 3 different companies. Ask for references, warranties and run a google search of the companies you are requesting a bid from. Find out how long they have been in the business. If the contractor is new to the business they may be available to return 3, 5 or 7 years down the road to correct any mistakes or issues that arise.
Finally, a pre-listing home inspection can save both you and your clients time and frustration. And, even in the event your sellers aren’t able or willing to make recommended repairs, you’ll be armed with beneficial information for disclosure purposes.
Shield Guard Home Inspections provides Pre listing inspection which is a full home inspection prior to listing the home.
Additionally we provide walk thru inspections which is an inspection looking out for potential "Major" Issues.
The Author Adam Clark is the owner and operator of Shield Guard Home Inspections. Adam Clark is a local Home Inspector located in Albany NY that has performed over 8500 Inspections. Serving the entire Capital District and Hudson Valley areas.
Phone: (518) 649-9111