Just as soon-to-become dream spouses or partners can become nightmares when information surfaces about that person being a suspected serial killer who murdered three former spouses in order to collect money in their joint bank accounts right before your best friend says “I do” at the chapel, dream houses can become nightmares just before your client writes a down payment check to make that dream house hers.
Would you not tell your best friend newly minted information about their almost-to-be spouse? Would you not tell your client about problematic information revealed in home inspection reports, title searches, and/or previously undisclosed disclosure statement concerning their dream house?
Much as your client only wants that hear/see/know great information about their dream house, it is your job as her agent to help your client see the “real” house underneath the dreamy version she has of it. If you don’t, your client may somehow hold you responsible for a negative, expensive reality.
Here are just a few red flags that may come to light…
1. Structural or underground issues such as a cracked underground pipe or a bulging wall crack or deflection that points to major flaws in the house’s foundation.
2. Water intrusion issues such as living next to a river or creek that often overflows or living in a hurricane flood plane. Mold, mildew and cold, damp walls all point to drainage/water problems.
3. Unremediated oil tanks, particularly on the East Coast where oil is used for heat, can be very costly to fix.
4. Lead paint and asbestos remain problems despite new building codes and restrictions. Make sure home inspection includes sending a camera down drainage and sewage lines.
5. Title searches that reveal judgments against the property that stick to the property, not the seller.
6. Title searches that reveal undisclosed fire.
7. Title searches that reveal that the person selling the house does not own the house.
8. Document related searches that tend to be flagged by brokers, insurance companies, lenders, attorneys, etc.
9. Seller’s disclosure statements are only accurate if the seller has actually lived in the house.
To look deeper into the reality of potential water intrusion, Florida broker Heather K. Colella suggests that potential buyers look into flood maps and the specifics of municipal elevation requirements. “Buyers need to know if they’re going to have to raise the elevation of the house or pay exorbitant flood insurance.”
Elizabeth Mendenhall, president-elect of the National Association of Realtors, suggests that buyers of “flipped” houses get proof of payment from all the contractors who have worked on the house. Without that proof, Mendenhall said, “the contractors could put a lien on the home which affects the new owner, not the seller who stiffed the contractors.”
This list could go on and on but the real point is that you as the agent owe it to your client, and to yourself, to be objective, comprehensive and cool. Love does not conquer all, even in dream houses.