Blaze Answers Your Questions About Repairs And More

Blaze Answers Your Questions About Repairs And More

Episode Transcript

Speaker 1 (00:01):
Hey, it's Michael Blaze. Welcome to Your Home three sixty,
the show where we talk about everything that has to
do with your home. You know, I get a lot
of questions from this show, so I figured I would
dedicate today's show to answering all of those questions, at
least the best that I can. So let's start with
a question from Susie. Susie says Blaze, I'm about to

(00:22):
put my house on the market, but I'm worried about
my roof. Should I replace my roof before I put
the home up for sale. Well that's a good question, Susie,
and a complicated one. So I don't know what the
shape of your roof is. You know, I don't know
how old it is. I don't know what kind of
condition it's in. But roofs can be tricky, So let's

(00:45):
start with this. Let's say your roof is older, but
it's not leaking, and so you decide you're just going
to go ahead and list it for sale. You find
a buyer. Buyer comes along under their due diligence and contract,
they have an inspection. The inspector says, I think the
roof should be replaced. I've had this happen to me before,

(01:08):
and my first question would be to the inspector, Oh,
are you a roofing contractor, Oh are you a general contractor?
Oh are you a contractor at all? No, then why
the hell did you put that the roof needs to
be replaced? Because now it's on record and it's not leaking,
and you said you didn't know how old it is
because there's an area there or it says age of

(01:28):
roof And I've had this happen where the inspector says unknown,
but I think the roof should be replaced, So now
you have a problem. And even if that doesn't happen,
if they're like, well, check with a roofing contractor this
is what they normally do. They use generalized language, and
I get it they have to do it for legal purposes,

(01:49):
but they'll say, you know, check with a roofing contractor
age of roof unknown, even if they just put no
leaks or whatnot. If the roof is old enough. Sometimes
the insurance company will say, well, we want that roof
replaced before we will write a policy on that house
for the new buyer. And then it becomes a question

(02:10):
of who's going to pay for that new roof, because
you have to consider this, there's no benefit to the
seller of having a new roof. The total benefit of
the new roof twenty five thirty years, however long it lasts.
The total benefit is to the buyer. So a lot
of people would say, well, so the buyer should pay
for the roof. Well, in a lot of cases, the

(02:32):
buyer doesn't have the funds to pay for the roof.
And how does that work anyway? Like you're going to
go put a roof on a house that you haven't
officially closed on yet. No, probably not, So you're going
to have to find some way to work it out.
You know, if there's enough room in the appraisal, you
can negotiate that you raise the purchase price of the
house and say that you will put the new roof
on it, and then that way, theoretically you're splitting the

(02:54):
cost with the buyer, or even charging the buyer for
the entire roof. It just depends how that negotiation works out.
So if a new roof is fifteen grand, you raise
the purchase price by fifteen thousand dollars and the seller
puts a new roof on. The buyer gets a new
roof and the insurance company is happy. Or maybe you
negotiate that the purchase price goes up by seventy five

(03:16):
hundred dollars out of that fifteen grand it's going to
cost for a new roof. Seller puts a new roof
on for fifteen grand, the buyer comes up seventy five
hundred on their purchase price, and then you mat halfway.
Maybe the roof has no leaks and it's not in
totally poor condition, and you can get a roofing contractor
that goes up, inspects it and says we'll make these

(03:36):
few repairs and it not'll last another ten years. I'll
happily write you a letter. You can provide that letter
to the insurance company and hope that they'll accept that.
As I said, dealing with roofs can be sticky. Unfortunately
for you, Susie, what I'm about to say doesn't help
you out very much. But I would give this advice.
If you're thinking about putting your house on the market

(03:58):
sometime in the future, go ahead and take care of
the issues that you think it's going to have at
that time. So if your roof is getting towards the
end of its life and you think, well, I might
be selling this in a couple of years. Go put
a new roof on right now, and then you got
some value out of it, and it'll be done when

(04:20):
it's time to put it on the market. And it's
one less thing that's going to come up in an
inspection report when you do put it on the market
and have it under due diligence, it's going to come
back and bite you in the you know what. So
any of these major systems or items that you think
are going downhill and are going to be dicey by
the time you get to the point where you want

(04:41):
to list your house, go ahead and take care of
it now if you're financially able to do so. Now.
Another way that that might be able to be addressed
is through a buyer obtaining an FHA two oh three
k loan, which is a renovation loan. And I am
not a mortgage expert, so we can have a mortgage
expert chime in here. If you'd like, you can contact me,

(05:04):
leave me a message and we'll do a follow up
on this. But I don't like those things because, among
other things, you can't control the draw and I'm strictly
talking about from a buyer's standpoint, it solves the seller's problem, right.
But if you're a buyer considering an FHA two three K,
there's all kinds of things to consider, like the timeline,

(05:26):
who's going to do the work, who controls the draw
and all of them that I've seen were not very
appealing to me personally. Somebody might decide differently. That's up
to you, but make sure that you're educated on how
the process works and what you're getting yourself into. And
I would say from the seller side of the equation,
it's probably going to make your property less valuable anytime

(05:48):
a buyer has to deal with extra things. If the
buyer has to take on the hassle of the repairs,
if the buyer has to get a different loan and
go through renovations and all of these things, then guess
what they're going to want to see some value on
their side of the deal, which means that you're going
to get less than what you potentially could have if

(06:11):
you just would have replaced the roof in the first place,
like I had already advised that you do maybe a
few years before. So if you're the seller, don't think, well,
I'm not going to do anything. I'm not going to
do any repairs. The buyer can take care of that.
They can go get a two oh three KFHA renovation
loan and problem solved. No, it's going to create a
bunch of more problems for you and probably less money

(06:34):
in your pocket at the end of the day, and
Susie to get back to you to wrap things up.
In your case, what I would do is contact a
roofing contractor have a consultation with them, have them take
a look at your roof and see exactly where you
stand with the roof, if it needs a total replacement
or if you can make some repairs. But I would
do this before I listed it for sale, and at

(06:57):
the very least you know what the situation is that
point all right, you're listening to your Home three sixty.
As I said at the start of the show, I
get a lot of questions. I figured I would just
dedicate today's show to answering those questions. So on to
the next question. This one's from Bill. Bill says, Blaze,
what do I need to do to my vacant land
to get it prepared to sell it? Well, Bill, I

(07:20):
get this question a lot, and I think I've even
addressed it before, but I'll go ahead and address it
again and again. Without knowing exactly what I'm dealing with here,
I'm just going to talk in general terms. So you
have a vacant piece of property that you want to sell,
So the first thing I would do is make it presentable.
I can't believe how many vacant pieces of property I

(07:41):
see up for sale that have not been maintained at all,
and there's vines growing. It looks like a jungle. You
can't even walk through it. Give it some love, get
a bushog in there, trim the trees up, even get
some mulch. I had somebody I had a potential client
where they're like, what would you do with it? And
it was a very nice piece of property on the water,

(08:02):
and I'm like, you know what, I would bush hog this,
and it's it was like kind of that's the way
I can best describe it, muddy. I'm like, I might
go in here and even put some pine straw down
or some mulch. And they're like, are you kidding me?
That's ridiculous. They're going to do this to a vacant
diesel land, And I'm like, but you want to make

(08:25):
it appealing to the buyer and show them what it
can be, and show them how appealing this is. Not
some overgrown, viny, dark because the sun can't get in there,
muddy piece of property that nobody's paid any attention to
for who knows how long. I'd really want to pay
top price for that, right, So you see my point.

(08:46):
Make it appealing and you can probably get some more
money for it, or at the very least, it might
make the difference in whether you get a sale or not.
You know, people might just blow off vacant land. It
can take a while to sell sometimes, and it's a
whole different animal than your houses. So make it as
appealing as you can. That's first on the list. And then, man,
there's so many things I want to talk about here.

(09:08):
I'm assuming that we're talking about vacant residential land that
a buyer would want to put a house on. Are
there public utilities? You know? Is there a public water
and sewer or are you going to have to put
a well or a septic or both? So let's start
with a perk test. I would go ahead and do

(09:28):
a perk test unless you have multiple acres. You know,
if you have a great, big old piece of land,
you don't necessarily know where the buyer would want to
put a house, so i'd probably skip the perk test. Now,
if it's just a residential sized lot and it doesn't
have access to public sewer, then I would go ahead
as the seller and do a perk test, because you

(09:51):
don't want to again get into like where you're under
due diligence and under contract and it comes back, well,
the property doesn't perk, So I'd much rather know that
before I even put it on the market. And by
the way, they're not called perk tests anymore. They're called
soil in sight evaluations now. So it used to be
where a perk test, they call it a perk test
because they dig a hole and put some water in

(10:12):
it and see how long it takes to percolate out. Right.
Now they evaluate the soil. But either way, we still
refer to it as a perk test a whole lot
of times. So I would go ahead and give yourself
that piece of mind, get that done, and if the
land doesn't perk, if it doesn't meet the soil in
sight evaluation, then I would go talk to a septic engineer,

(10:35):
and I would consider having them designing an engineered system
for me and pulling a septic permit. Septic permits are
usually good for five years, and that will give you
and the buyer piece of mind. You know that you've
already overcome that problem up front. The buyer knows that
you've already overcome the problem upfront, and there's some value
in that because now they can proceed in buying your

(10:57):
property and not have to worry about the septic tank. Yes,
it will cost you money upfront, but it will also
add value to your property. What about water supply? Do
you have city water available at the lot? If not,
then I would do the same thing I was just
talking about with the soil evaluation. All right, where is

(11:18):
the water going to come from? Is it going to
come from a well? Is it going to come from
a retention pond. You might not have to go dig
a well or build a retention pond, but I'd at
least talk to some professionals about that and have an
idea and a plan in mind that you can share
with the buyer. Moving on, I would also consider the
shape of the lot in the setbacks. Is it an

(11:39):
odd shaped lot, What are the setbacks? What I would do,
for sure, if you have the money, is hire a
surveyor and have them put some stakes out so people
can visualize just where the property is and just what
it is that they're buying. And then best way I
can describe this, I'll tell you a little story. So
I had this was a lot that my mother owned.

(12:00):
It was an odd shape lot because they had done
some caraveouts and this and that, and they had changed
the county had changed the setbacks and now said that
it had to be set back further, however, many feet
from the lake, which meant that it had to be
set back several feet further than the other properties that
were already the other houses that already built on the

(12:22):
neighboring lots. I contacted the county. I said, this isn't fair,
and they said, we agree, and we'll give you a variance,
but you just can't go past the plane that the
other properties are on your neighboring properties along the lake.
And I'm like, okay, fine. And by the way, my
dad had already taken care of all of this, but

(12:43):
he passed away and nobody knew where this information was.
I'm like, well, where's the package. My Mom's like, I
don't know. And to make a long story short, i'll
skip ahead to what I did to market this property.
So we have an odd shape lot, now we have
updated setbacks. We have a neighbor who meets everybody out

(13:04):
there that comes to look at the property and tells
them that it's an unbuildable lot because of all of
these things. So what I did was, as I said,
I talked to the county, I recorded that information, put
it in the sales package so any potential buyer could
do the same. And I also hired a surveyor to
not only mark the property lines, but I'm like, hey,

(13:27):
while you're at it, I will pay you extra. And
I did my homework. I'm like, put the footprint of
where a house could go, and this is according to
potential variance, where we're going to be on the same
plane as the neighboring houses on the lakeside. And then
here's all the setbacks on these odd shaped carve outs,

(13:48):
and this is where the house will fit and how
big the house will be. And we can show them
that yes, it is a buildable lot. And as a
matter of fact, you can get a nice sizable house
on this property and it is not an unbuildable lot
like this. Well, I'll stop myself from calling names. This
gentleman next door keeps telling everybody. So to recap what

(14:11):
I did to sell that vacant piece of land. It
was cleared, the trees were trimmed up, you had a
good view. It was a pretty property. I went and
had a survey or mark all of the corners and
also the footprint of where a potential home could go.
Also had a soil test per test done, and I
also had talked to a well company and had that

(14:32):
information handy all in a sales package, wrapped up with
a bow and ready to go. And since it would
need a variance, I also talked to the county, got
the timelines of how long all of that would take,
what the process was to do it, and put that
in the package. Also, that is how you should sell
a vacant piece of property. So Bill, I hope that

(14:54):
answers your question. Now, the property that you're thinking about
selling may not be involved as all of that, or
it might be more involved. But take what you will
out of that and make that property the most appealing
that you can. So you can get the most money
that you can out of your vacant piece of property,
and good luck. On to the next question. I'm doing

(15:14):
nothing but answering questions. On today's show, Tony says, Blaze,
my kitchen is very dated. Should I remodel my kitchen
before listing my house for sale? Tony, No, don't do that.
I get this question all the time. No, you're going
to lose money if you do that. Well, let me

(15:36):
qualify that. Is this outdated kitchen still functional? So if
it's still functional and it's just outdated, then no, do
not remodel it. As I said, you're just going to
lose money you return on investment on a remodeled kitchen.
You're probably going to lose twenty thirty, maybe even forty
percent of what you put into it to remodel it.

(15:56):
And how do you know what some potential buyer is
going to want out of their kitchen? Let them go
and do that. And this goes for everything that has
to do with your house. It's not your kitchen. Being
dated is one thing. Being non functional is another. So
if it's non functional, yes, fix it. And if there's
holes in the carpeting and the carpeting is disgusting. Yes,

(16:19):
I would probably replace the carpeting. If the walls are
all scuffed up or some absurd color, or have holes
in them or whatever it may be, fix the walls
and paint them, put a fresh coat of paint on.
But beyond that, don't go putting a bunch of money
into a house that somebody might very well come along
and change anyway, and it probably won't add value. And

(16:43):
if you look at the tables the charts that show
you what your return on investment is for each of
your home improvements, there's hardly any that are in positive territory.
I can remember too off the top of my head.
The only two that there were. That's why I remember
them front door. So replacing the front door actually increase

(17:05):
the value. You got more money back than you spent.
And a lot of people might think that's ridiculous, But
that's curb appeal. And I would say doing some landscaping.
If I'm going through a house and I'm saying what
kind of improvements can we do to get the most
money out of this in the quickest sale, I'm going

(17:26):
to look at curb appeal first. How does it look
when I drive up. What is the landscaping like, you
don't need to go do twenty thousand dollars worth of landscaping,
but trim the shrubs, cut the lawn, put some mulch down,
and yes, this goes for inside and outside. Pain anything
on the house that needs painting. If there's peeling or

(17:47):
chipped paint, make everything is pretty. Powerwash the house if
you have a bunch of green stuff growing on there.
And then once you get inside I mentioned the carpeting. Yeah,
if the carpeting is disgusting, replace that. If the wall
they're disgusting, paint those and make sure it's nice and
clean and make sure it smells good. And that's about
as far as you should take it. Of course that's

(18:08):
just my opinion, but I've got some experience of this.
So make it as pretty as you can make it
with the least amount of money that you can. And
so I was mentioning too, you know, positive rois on
improvements on your home. So the front door, that adds
to curb appeal, that makes sense, and to deck that

(18:29):
makes sense too because it expands your living area. Now
would I go build a deck in order to make
a little more money off the sale of my home. No,
I would not do that. But if you have a deck,
make sure the same thing applies is to your house
and everything else. I just said, make sure if there's
rotten boards in the deck, replace the rotten boards. If

(18:50):
it's all weathered and chewed up and dirty, clean it
and maybe stain it or do whatever it takes to
make it more appealing in extra living space outdoors, and
people will appreciate that, and they'll be willing to pay
more for that. Today is question and answer period on
your Home three sixty. I appreciate you listening. So there's

(19:13):
a few questions that I got from our listeners. Here's
some more questions that I get asked all the time.
One of them is about repair procedure. So more than
likely you're going to be under due diligence in a
contract once you have a contract for sale, and the
buyer is going to do inspections, more than likely, and
during those inspections, the home inspector is probably going to

(19:34):
find a host slew of things wrong. Now, the buyer
may come back with the whole list. I just had
that happen the other day, thirty eight items, and I'm like, well,
we're not selling you a brand new home. And I
had the conversation before we accepted their offer that look,
if there's anything hidden here that we find during the inspection,
we'll be willing to address that. But the things that

(19:55):
you see, please don't come back after we've already agreed
upon this price and try to get the price down more.
But they came back with thirty eight items. So what
do you do at that point? Well, there's several choices,
so the seller can agree to repair them all. The
seller can agree to repair some of them, and the
buyer has to agree if they want to go along

(20:18):
with that they agree with the seller. There has to
be a meeting of the minds there, or the seller
can say no, I'm not doing anything, and then the
buyer has to decide whether they want to proceed or not.
If they do not want to proceed, they can kill
the deal under due diligence. So that's how you handle that.
Now I get asked, well, kn't we offer some money

(20:39):
and then the buyer can take care of the repairs themselves. Well,
you can do a price reduction. But the term seller
credits gets misused all the time, because essentially you can
offer up credits where the seller pays for part of
your closing costs or you reduce the price. But you

(21:00):
can't walk away with a pile of money to do
those repairs. Now, it used to be where you could
do that. You could put like a carpeting allowance in there,
three thousand dollars, the buyer gets three grand at the
closing table to go replace the carpeting. Those days are
long gone. You can't do that. You can't walk away
with money. So you're talking about either a price reduction

(21:21):
or you're talking about some seller credits towards your closing costs,
and that's the way you can handle that. Now, you
also have to be careful because FHA loans have a
higher standard and so do VA loans. And there's some
things that need to be addressed before the property can
change hands. So if there's anything wrong with the heating system,

(21:43):
if the windows are broken, if there's holes in the walls,
things like that, those do need to be repaired or
you can't go forth with the financing. So it behooves
the seller to agree to repair those items. And let
me point this out. If you designed to proceed with
with say a price reduction in lieu of repairs, the

(22:04):
buyer has to have enough money to do those repairs,
because that price reduction over a thirty year amateurized mortgage
isn't going to amount too much every month back in
your pocket, and it certainly is not going to cover
the amount that it will cost to do those repairs.
So the buyer has to be in a position to
be able to have the cash to do those repairs

(22:25):
after they close. So if you're going to take a
price reduction in lieu of repairs, you have to make
sure that you have enough money to do the repairs
yourself and still pay your bills comfortably. All right, I'm
running out of time here, but I think I can
squeeze in a few more answers to some questions. Another
question I get asked all the time is I'm ready
to buy a house. What's the first step? Is the

(22:47):
first step talking to you looking for homes? Well, the
first step should be talking to a mortgage broker or
your bank and getting pre approved for a mortgage. Not
pre qualified. I'm not talking about log it online and
filling out the sheet and then it says congratulations, you're
pre qualified. No, I'm talking about a real pre approval

(23:07):
where they look at your finances. You can get a
letter from the lender saying, at this point in time,
under these conditions, will approve the loan, and that way
you know what your budget is. You're not wasting time
looking at things you can't afford, you're not getting emotionally
invested in a house that you can't afford. And the
other thing is it makes your offer stronger when you

(23:28):
can include that pre approval letter because the seller is
going to look for that, because the seller says, for
all intents and purposes, I'm taking the house off the
market once it goes under contract. You know, most of
the time it goes active contingent, which means it continues
to be marketed. But people can tell that it's under contract,
and they're probably just going to blow on by and
look for houses that are not active contingent. So they

(23:53):
want assurance that you're not wasting their time and valuable
carrying and everything. Well, they're waiting for you to go
get approved for a loan. You can show them that
you've already started the ball rolling and that you've talked
to the lender and at this point they'll approve you,
and that gives the seller piece of mind to accept

(24:14):
your offer. So always start with a pre approval from
a mortgage broker. And if you don't want to go
to your bank or you don't know of a mortgage
broker that you can approach, your realtor can point you
in the right direction. I assure you of that. And
before I go, I just want to say this is
going to sound self serving, but there are a million

(24:36):
landmines when you're buying and selling property, and unless you
really know what you're doing, you need a realtor to
help you out. I'm just not saying that because I'm
a realtor. I remember when I bought a house for
the first time and I was not a realtor yet,
and I think back on that, and I also honestly
think back on the realtor I had, and I'm like, huh,

(24:57):
I wish I had a better one. But the point
is is that there are so many things contractually that
are at stake, and it's probably your biggest investment, right
and you need somebody that knows how to guide you
through and knows what those landmines are and knows how
to protect your position in the negotiation and ultimately in

(25:21):
the sale of your property. So I truly believe that
ninety nine percent of people out there really need the
help of a realtor. If you have any questions that
you'd like me to address on the show, I'm not
going to give you my contact information on the air here,
but you can easily google me. Just google Michael Blaze's
real estate and then you can either call me or
send me a message with your question and I'm happy

(25:44):
to answer it for you, and I'm always happy to
talk to you in person if you so choose. I'm
a low pressure type of guy. Thank you for listening
to Your Home three p sixty today. We've got the
podcast up online for you. Just go to ninety four
to three WSC dot com and click on podcast and
you'll find today's podcasts and all the podcasts from the
past up there. Thanks for listening to Your Home three

(26:06):
sixty and enjoy the rest of your weekend.