Do You Know the 5 Answers?
Homebuyer Associates June 2015 E-Note
Do You Know the 5 Answers?
Let’s have a contest to add a bit of summer fun to our newsletter. I’m going to ask 5 questions based on factual matters specific to a recent inspection negotiation. Answer the questions correctly and you may win a Breadsmith gift card for 12 loaves of bread. Contest instructions are at the end.
First some background: In my June newsletter, part 1 (see below), I discussed the negotiation process for a condominium purchase. The seller wanted $169,900. Homebuyer Associates’ analysis showed it was worth $160,000. If you know or have worked with Homebuyer Associates, you understand we have strong beliefs about whom the industry really works for – and who it doesn’t.
“We Are Not All Created Equal” Part 1:
http://www.
That belief was apparent in the negotiation process. Our negotiation reflected the use of data. The seller’s negotiation reflected opinions without data and opinions not material to the home’s value. I ended that piece with the sentence: “And then it became interesting.”
It became interesting because the transaction fell apart. This happens once a year and it happens for good reason.
The “interesting” part is that my client’s inspector – an inspector I respect and have known for 25 years – found fault with the exterior siding of the building (1 of 19). The siding used was a product that was part of a class action lawsuit. The inspector’s exact words were:
The building is sided with fiber cement siding with cedar trim. Excessive gaps due to shrinkage of the siding were observed. The conditions indicate the siding is defective and manufactured, likely “Certain Teed” brand. This brand of siding at the time it was manufactured is known to be defective as manufactured and subject to class action lawsuits.
Given that information I suggested my client walk away from the purchase.
The correct process for walking away requires that a Notice of Defect be given and Mutual Release signed. Here is what occurred:
– The Listing agent noted in writing, “A number of units have sold in the past year and the siding has never been an issue.”
Question 1. Should my client purchase the condominium given the siding issue has not come up in the past?
– The Listing agent noted in writing, “The Association is not aware of a siding issue.”
Question 2. Why might the Association have no knowledge and of what value is the statement?
– The Listing agent noted in writing: “The Association is willing to take care of the siding issue for that building.” (Remember, there are 19 buildings each containing 5 units.)
Question 3. The seller was going to have the problem fixed at no cost to my client. Should my client purchase the unit if the seller/associaton will fix the siding problem for that unit?
Question 4. The condominium is back on the market. Do you think the agent and seller updated and disclosed the siding issue as part of the owner’s real estate condition report?
Bonus Question: Tell me the name of the big man (I’m the little guy) in the photo of Part 1 of the June newsletter. Hint: He played for Marquette University when they were the Warriors.
Send your brief answers (to Questions 1-4 and the Bonus question) to:homebuyeba@gmail.com. In the subject line please write Breadsmith Breadwinner. My crack team of advisors will review the responses and award certificates to 4 winners.
The prizes: It’s nice to have people read our newsletter and even nicer when they are former clients who own a Breadsmith location. Tim is one such past client. Tim read the June (part 1) newsletter and offered up prizes for the contest. Thanks Tim.
Remember, it’s not whether you win or lose but how you play the game. .
We remain available for coffee if you’d like to discuss how best to buy a home or how best to manage the sale and purchase of a home.
Thanks for reading,
Michael D. Holloway
Homebuyer Associates
414.254.4129
www.homebuyerassociates.com
homebuyeba@gmail.com
Michael D. Holloway / Seamus Holloway