Foundation Repair and Real Estate Issues
There is a woman two doors down from me who wants to sell her house and also needs her concrete foundation repaired. I’ve not been inside her house but all the signs are there on the outside. She’s got the tell-tale zig-zag cracks in the brick and a widening crack by the garage door. Word is that she wants to sell the house without getting the foundation fixed first.
Across the alley behind me is Bobby who is in the same boat. A painter by trade, Bobby needs to sell the house because he has an ex-wife with lawyers. While getting the house ready to go on the market, the home inspector’s report indicated the need for foundation work. Bobby would rather deduct the price of repairs from the sale price of the house and let the buyer get the work done
What both are finding out is that pounding that For Sale sign in the front yard when you know your concrete foundation needs repair is creating a new set hoops to jump through at best.
As the seller, you must disclose the issue. The buyer’s inspector will see the signs of foundation failure and include that in his report. VA and FHA lenders are not going to lend money for a house with a bad foundation. Conventional loans are just as hard to come by.
My friend Johnny Thompson used to be a radio program director and morning show DJ. He is now a licensed real estate agent in Florida. He sleeps in and makes a lot more money. He says the best thing to do is to hire a licensed structural engineer to do a foundation inspection and if needed, a written plan for repair. Then get bids from foundation repair contractors that will execute the repairs according engineering plans. Keep copies of all reports and inspections before and after the repair and include them with your disclosure statement. In Texas, use a company that will give you a transferable warranty. All of this will make the mortgage process a lot easier.
Another friend, Rich, is a Dallas area real estate investor. He buys and sells houses. His advice is to get the foundation repaired before the home goes on the market. When he makes an offer on a house that has a bad slab, the offer is well below market value. He knows he’ll not only need to repair the foundation, but it’s likely he’ll also need to call in the dry wall folks and painters and maybe even a plumber. Foundation failure can and sometimes does break the plumbing. Leaking pipes can be a cause of the failure as well. Thus the offer he makes to the seller would need to allow for those expenses, some padding for when things go wrong and they almost always do, plus some profit.
Read the websites of foundation repair contractors that address the real estate angle and you’ll hear the same song. Of course it is in their interest to sing that song, but in this case the facts are on their side. If you have to beg, borrow, or dare I say it, sell the boat, get the foundation repaired before you put the house up for sale.
And remind me to give Bobby’s business card to Rich.