Money Talks, So Should You

I Am 1 Percent: Consider these features when negotiating a home

I Am 1 Percent
by I Am 1 Percent , Dimespring 30 (@Iam1percentblog)

With the real estate market picking up in many cities across the country, there are many things to consider before buying a home. Many are obvious, like the selling price of similar homes in the area, the age of the home, and other amenities.

However, there are other more subtle considerations that can affect the selling price of the home

READ: Beware the "wealth effect" when buying a home

My wife and I bought our home in 2009. We looked at dozens of homes before placing an offer. We walked through our current home about two times prior to making an offer, and we were really impressed with all of the visible features such as the wood flooring, curved staircase, two-story family room, sun-room, library, etc. Our previous home was a much smaller two-bedroom townhouse, and we were so blinded by the upgrades that we missed the more subtle issues ended up costing us money in the long run.

Here are some of the things we missed:

Roof Age: This will be one of your biggest home renovation projects. We knew that we were near the end of our roof life when we bought our home four years ago, so it came to no surprise to us when we decided to replace our roof.

Furnace Location: We knew our house had two furnaces (one in the basement and one in the attic), but did not think about how they would need to be replaced. The furnace in the attic can only be accessed by a small 3’x3’ panel in my closet. I have no idea how an entire furnace will ever be replaced when the time comes, but I presume this may cause issues in the future.

Water Drainage in Yard: When we looked for homes, it had not rained for days so this problem was hidden. After we moved in and had our first few rainstorms, we noticed areas in our yard that pooled up water. This is not only an eyesore, but can lead to accelerated weed growth and yard damage. 

Quality of Deck/Patio: Although our house has a wood deck, it was not well maintained. Additionally, the patio was built with cheap brick pavers and not nicer stone pavers. And because of the drainage issue mentioned above, water tends to pool up on the patio. This is important to note during negotiations.

Trim Work: Pay attention to the trim work when looking at homes. Check the baseboard, look for crown molding, chair molding, wall panels, pillars, mantle work, doorway trim, window molding and wainscoting. If you don’t notice any trim work, you should take this into consideration when making an offer if you’re comparing it to a home with trim work.

Bathroom Quality: Examine the bathroom. If the bathroom has ceramic tile, a standard shower with a Plexiglas door and a plastic floor, and no granite, you should take this into consideration when comparing it to a home with stone tile and granite countertops. 

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Kitchen Quality: Although our kitchen had 42” cabinets with crown molding, we didn’t notice that the quality of the wood was sub-par. If we paid attention to this, we could have used it in the negotiations. Our kitchen had none of these upgrades so now we are thinking about replacing our kitchen sometime in the future.

Basement Humidity Level: A basement without good ventilation can have a high humidity level.  Excessive humidity can lead to mold growth and can be a breeding ground for certain insects.  Be certain you check this because this is one issue that is difficult to remedy

Wood Floors: If the house has wood floors covered with rugs, make sure you lift them up to check for fading. After we bought our house and walked into the empty home for the first time, we noticed that the areas under the rug were darker than the surrounding areas. Luckily, we found rugs to cover up those areas, but it’s an eyesore otherwise. 

If we knew about these issues when we bought our home in 2009, we either would have not purchased this home or we would have made a more aggressive offer taking these issues into consideration. We will likely stay in this home for many decades, so we will make many of the upgrades in the future, but I wish we had known this four years ago.

 

I Am 1 Percent is a self-made, mid-thirties, professional man whose family recently crossed the $1 million threshold in terms of net worth. I Am 1 Percent is a member of the Dimespring 30, a community of bloggers sharing their thoughts, experiences and perspectives.