I am currently considering putting an offer in on a duplex. It needs a roof. Our insurance rates are very very high in this Parish. Average quotes are 4k-5k a year with a new roof. Provided you can find a broker that is willing to write a policy. I have found one quote in the 2500$ a year range. This is with a newer roof.
How do I go about asking for a new roof from the prospective sellers? Is this possible? My insurance company suggested I ask for a sellers concession. A roof? That seems like it won't go very far in the negotiation process. It would be a deal breaker to leave the old roof on.
Well, always be ready to walk away if the numbers just don't work for you, especially with the high taxes of your Parish/County.
You can ask anything you want of the sellers! Maybe they won't do the whole cost of the roof, but if they agreed to say 50%, would that be a good deal for you?
One question is whether the duplex is already priced to reflect the fact that it needs a new roof. As far as a "seller's concession" goes, that term is usually used to reference the seller paying some of your financing and/or closing cost. A roof goes quite a ways beyond that.
Another option is the seller puts a new roof on. I don't care for this because you never know what the seller may do in order to save money. And of course, the seller may not want to do that, especially if he already has it priced that way.
Depending on the loan type, perhaps you could do a credit for the roof, or escrow some funds for the roof that would be released when the roof is completed. Sometimes the lenders are gun shy about putting too much in the buyers hands, so they want the escrow.
Since you haven't made your offer yet, I'd speak with your lender and ask what they will permit. Then I would make that part of my initial offer. If they don't accept, and it's a deal breaker, you walk and go on to the next deal.
I would say it's priced as if it had a new roof. I like the 50/50 idea. I personally think it's above and beyond to ask for a new roof as a sellers concession also. I do not believe the house can be insured if it does not get one. The sellers may not be aware of that.
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