We’re coming out of the worst storm I have experienced in over 30 years of living in Texas. We are hearing of pipes bursting and water leaks all over the Austin area.
Many homeowners will be worried about home values being affected when selling a home with previous water damage. Whether you are planning to put your property on the market next month or in 5 years here are a few helpful tips to make your real estate transaction easier and let you sell for top dollar.
No Discount For Homes With Water Damage In Today’s Market
When you search for how to sell a home with water damage, you’re going to find hundreds, maybe thousands of blog posts written by companies that want to make a low-ball offer for your home.
For anyone planning to sell your home this year the good news for you is I don’t expect you will need to sell at a discount. Because the inventory of homes on the market is historically low buyers don’t have many choices. Left between buying a home with previous water damage or not buying a home at all you can expect buyers in the market today will still pay market value.
A few months ago, we talked about how a home with water damage was one of the 3 types of homes sellers should consider selling right now. In today’s market we don’t see a reason to sell at a discount. Whether or not that holds true in 5 years remains to be seen.
Realize That You Have 2 Problems
If you’ve had water damage at your home that’s a problem. Your first instinct will be to only deal with that physical house problem and that’s understandable.
If you want to sell your home without a discount you must realize you have a 2nd problem. Your second problem is a consumer behavior problem. Buyers in our area are very cautious. A more accurate description might be they are “terrified of everything.”
It will be tempting to make repairs that are “good enough.” What I encourage you to do is put yourself in the shoes of a future buyer and think about how the repairs should be done so that a buyer is comfortable making an offer for your home.
Last year I sold a home that had extensive termite damage. A beautiful bathroom renovation was done by a contractor. Unfortunately, either because he didn’t know better or was trying to save money, the contractor applied a pest treatment found at home improvement stores rather than have a licensed pest control company treat the area to ensure the termites were killed.
Understandably buyers wanted to know if the underlying termite issue was remedied correctly and were skeptical of how the contractor did the job. Maybe the contractor did the job good enough, maybe not. At the end of the day that doesn’t matter. What matters is how the buyers think the job is done. In this case by the contractor saving $300 by not hiring the correct company it cost the seller tens of thousands of dollars because buyers were scared off.
When you decide to sell your home, you should assume future buyers will want to see details of how any water damage repairs were made. A reputably vendor will be able to provide a detailed paid invoice showing what work was completed. You should also take before and after pictures to document the repairs. If the paperwork you receive doesn’t look professional and doesn’t pass the snuff test it likely won’t for future buyers, either. Remember, you are dealing with the perception of how things are done and not simply if they were done correctly or not.
Keep this paperwork somewhere safe that you will be able to find when it comes time to sell. Don’t count on the company that did the work to be able to provide you copies years from now, they may not even be in business.
Unless I am representing you in a real estate transaction it is not possible for me to give you legal advice. This information is for educational purposes but it does not create any implied agency. Our advice to our own clients is it’s better to disclose than end up in a legal battle after the sale of your home. If we are not representing you in a sale and you have questions about what you need to disclose, I recommend speaking with a real estate attorney.
In most cases when you sell your home you will be required to complete a Seller’s Disclosure form. Here are a few of the sections of the most commonly used version of the Seller’s Disclosure used in Texas that reference water damage.
We will all get through this. I hope this information is helpful and it saves you money whenever you decide to sell your home.
If you have any questions about your buying or selling a home that could have suffered from water damage contact us at 512-791-7473 .