REThink Real Estate
REThink Real Estate
Q: I'm trying to buy a townhome in Las Vegas right now. The seller wants $46,000 for it, but I just found out the air conditioning is bad and will cost $5,000 to replace. So far, the seller wants to allow only $1,000 for repairs. Do I have any say so in getting the seller to come down? No wonder deals go bad when sellers don't want to compromise at all! --Sage
A: To be fair, I wouldn't jump to the conclusion that sellers don't want to compromise at all. The fact is that many people selling their homes today -- actually, most people selling homes in Las Vegas -- are upside-down, meaning that they'll either have to do a short sale or write a check to close the deal.
Most often these days, it's not a matter of whether they want to compromise; most desperately want to get out from under these mortgages they can no longer afford. But many cannot afford to compromise, especially when it comes to big-ticket items.
With that said, here are three things you should be mindful of, as you develop your response to negotiating the cost of replacing the air conditioning with the home's seller:
1. You're the boss of you. This answers your question about how much say-so you have; you have the ultimate power to decide what you're willing to accept, and what you are not willing to accept, up to the point in time at which you have to remove your inspection contingencies. You get to decide whether to take the seller's $1,000 offer, and you have the right to push back against it as well.
It's up to you to decide whether losing the place is worth it, over the $4,000 gap between your position and the seller's. Some might think not, as $5,000 isn't an enormous amount of money, if you love the place and have it to spend. On the other hand, the air conditioner replacement cost is more than 10 percent of the total price you're paying for the home, and there is no shortage of townhomes on the market in Las Vegas.
Your say-so extends through the time you have set aside for your inspection contingencies -- at that point, you've got to come to an agreement with the seller that works for you or back out of the deal in order to recoup your earnest money deposit.
2. Don't assume it will cost $5,000, just because someone told you so. You say the replacement air conditioner will cost $5,000, but before you walk away from a place you love over this issue, fully explore whether the $5,000 you were quoted will be the true cost. Make sure you get multiple repair estimates, as there is always a range of costs you can incur for these things, depending on the vendor; some might quote you a higher price, but you might also find someone who can do it for less.
If you think you can wait a couple of months to replace it, talk with HVAC (heating, ventilation, and air conditioning) vendors about what sort of off-peak discounts they may offer. I have known vendors that provide as high as a 50 percent discount off the unit when they install air conditioners in the winter time. Also, factor in the $300 federal tax credit for installing a new, energy-efficient air conditioner (which is in effect through Dec. 31, 2011) and any similar state and local tax credits.
3. It's not over because the seller offered you $1,000. Consider the possibility that the seller might not have the resources to cover the entire $5,000, or might simply be trying to meet you somewhere in the middle. If he didn't want to compromise at all, he wouldn't be offering to pay anything! Did you ask him to cover the whole $5,000?
If so, perhaps the seller would come up from $1,000, if you came down from $5,000. Try a counteroffer of $2,500 and see what happens!
Tara-Nicholle Nelson is author of "The Savvy Woman's Homebuying Handbook" and "Trillion Dollar Women: Use Your Power to Make Buying and Remodeling Decisions." Tara is also the Consumer Ambassador and Educator for real estate listings search site Trulia.com. Ask her a real estate question online or visit her website, www.rethinkrealestate.com.
|Contact Tara-Nicholle Nelson:|
|Letter to the Editor|
Mirrors don't have to be kitschy
What's Your Home Worth?