Buying a new home or selling a current one can be very exciting, even exhilarating experiences for both parties. However, if repairs need to be done before all terms are met, it’s predictable that conflicts could arise. As a veteran of the Breckenridge real estate market, I’ve seen my fair share of these types of situations.
The million dollar question remains: who fixes the home under such circumstances? There is no black and white answer to this inquiry. In fact, the best reply is that it depends.
The fact is that real estate contracts can vary in a lot of different ways. That’s why it is so important that buyers and sellers read the inspection and repair contingencies carefully. That way, both sides can understand what they’re agreeing to before they sign off on the sale.
To be clear, the contingencies spell out the scope of inspections that buyers can execute, the exact time frames for these inspections, any notice requirements and a listing of the results that could occur once this time frame concludes.
Who Benefits From the Contracts?
Just as the responsibility for repairs may go to the buyer, seller or both, the same could be said concerning the benefit of the contracts. Some can be skewed more for the buyer, while others may be written mostly for the seller’s best interest. Again, it all depends.
A contract that is to the buyer’s advantage may include:
- A general home inspection;
- The ability to provide the completed inspection report to the seller with a listing or required repairs;
- In lieu of repairs, the report could have a dollar amount specifying credit, which would reduce the home sale cost;
- The seller has the choice of making repairs, agreeing to credit or suggesting another arrangement; and
- In response, the buyer can accept, negotiate or reject the terms of the sale.
In turn, a contract that gives the seller more say could include:
- The buyer is free to pursue an inspection, but not request repairs or credit; and
- The inspection is framed as “for informational purposes only” in order to let the buyer know of the property’s condition, but nothing more.
Therefore, different types of contracts can elevate either the buyer or the seller in a real estate transaction. Knowing the benefits involved in a contract are key to the best way for you to proceed either as a buyer or a seller.
Understand the Contract Inside and Out
Since there is such a wide variety of contracts that can be made between buyers and sellers, it is essential to know the limits. Some contracts allow buyers and sellers plenty of room to negotiate what must be fixed and what won’t be touched.
Yet other contracts make it clear that buyers can only have true property flaws or building code violations addressed before the sale is completed.
The Breckenridge real estate market is governed by Colorado state law, and like many states, the law can be a challenging when you try to figure everything out on your own. That’s why part of my job is to look closely at repair contingencies with you so that your interests are fully covered.
One way to create a win-win situation for both sides is to proceed with an open and fair negotiation. Instead of a buyer insisting on a seller making repairs (which could be done quickly and with poor materials), a credit could be the best answer, but you won’t know how much room there is between the buyer and seller until you start negotiating.
If, for instance, repairs cost $2,000, a $1,000 allowance toward the fixes may satisfy both sides. That way, the seller isn’t burdened with funding the entire repair and the buyer can put the credit towards having any renovations done to certain specifications.
Of course, if the necessary repairs are very expensive, such as a broken heating system or a mold problem, more extensive terms may need to be negotiated.
Want More Ideas on How to Determine Who Fixes the Home?
Figuring out who makes any fixes to a home before it changes hands can be complicated and stressful. The thing to keep in mind, though, is that you don’t have to resolve this question by yourself. I’m here to make sure the process happens smoothly. If you have any questions, don’t hesitate to give me a call so we can talk it through and plan an effective strategy.
Also, if you’re looking to buy a new home in the Breckenridge real estate market, reach out then you begin. I’m happy to put together some properties that look promising, and you’re always welcome to browse through the updated listings on my website. When you’re ready to talk through your options or schedule showings, contact me at any time via email ([email protected]) or on my office line. I look forward to working with you!