Purchasing a home can be an exciting, yet overwhelming experience. If you’re considering purchasing a home that has suffered catastrophic damage, there are some important steps to take to ensure you make the best decision for your situation. Today, Centriq shares a list of tips and tricks that will help make this transition easier.
Talk to Your Real Estate Agent
The first step is to call your real estate agent. Discuss the details of the property you are interested in purchasing. They can provide information about available options for financing as well as what type of repairs may be necessary to bring the home up to code.
Calculate Necessary Repairs and Add 20 Percent
It is important to list and accurately price out all necessary repairs before making a decision. When pricing out costs, it’s wise to add 20 percent onto your estimate for unforeseen repairs or any potential upgrades you may need such as electrical work, HVAC systems, foundation problems, or issues with asbestos or mold. This will help make you prepared for any additional expenses that could arise due to the property’s condition when making your purchase.
Review Home Sale Contract
Review the home sale contract thoroughly before signing it. Make sure all necessary repairs are listed in the contract along with any potential price reductions due to damages sustained during catastrophic events such as floods or fires. Additionally, make sure all contingencies are listed such as if financing falls through or if there are any problems with inspections from contractors or home inspectors.
Recruit a Real Estate Attorney
Hire an attorney who specializes in these types of cases when dealing with catastrophic damage on homes being purchased. They can help review contracts and negotiate any necessary repairs or other legal matters needed. This will save time and money down the line by ensuring all paperwork is done correctly from the start.
Do Your Research
Nobody likes doing their homework but sometimes, it’s necessary – and can save you a bundle in the long run. For instance, homes in San Francisco start at $730K, and researching area home prices will give you an idea of what constitutes a fair amount for a price reduction due to catastrophic damage on a property being purchased. This information can also help inform negotiations between yourself and sellers regarding how much money should be spent on repairs before closing on a property with significant damage sustained from natural disasters or other causes.
Doing your research also applies to cleaning and repairs. Make sure you only use cleaning products you can trust, and if you hire professionals to help you, make sure you read their ratings and reviews to ensure that you’re getting the best deals possible.
Hire a Contractor and a Home Inspector
Hiring a contractor and home inspector will ensure that all necessary repairs have been identified before closing on a property with catastrophic damage sustained during its lifetime. This will also allow buyers more leverage in negotiations when asking for price reductions due to damages found during inspections conducted by both parties before the purchase.
Check State Laws Regarding LLCs When Operating a Business from Home
If you plan on setting up a business in the home you recently purchased, it’s important to take extra precautions and check with state regulations regarding LLCs. Along with purchasing home insurance, forming an LLC can provide additional protection from liability. As each state has its regulations so make sure you know to start an LLC in California before making any decisions or signing any documents. Additionally, make sure that any risk assessments are conducted before setting up shop since some businesses may pose additional hazards due to their nature of operation which could potentially injure visitors or employees at your site.
Negotiate Necessary Repairs
Before closing the purchase, it is important to take a detailed look at the property’s condition, and determine if any necessary repairs will be covered by the seller. Negotiating these repairs can be challenging, as many buyers want to get the best deal possible. However, taking the time to properly evaluate the condition of the home and having an experienced real estate professional help negotiate repairs can make all the difference in getting a great deal on a great home.
Examine the Property Before Closing
Finally, examine the property before closing. Carefully inspecting the areas affected by the damage can help identify any potential problems that could arise if the property is not properly repaired. This can include checking for structural instability, hidden moisture issues, or even environmental hazards. Knowing what you’re getting into ahead of time can save you a great deal of money and stress in the future.
Purchasing a home with catastrophic damage requires patience and research but it also offers many rewards along with new challenges. Take some time now before making any big decisions regarding purchasing homes affected by natural disasters. These best practices should put anyone interested in taking their first steps towards owning their own house at ease.
Centriq is the only home management app you’ll ever need. Click here to get started!
Want more help with every thing you own?
Check out Centriq!
