Inspection response

[Sharad M.]

Hello all,

So after the inspection on a 4-plex, we sent the following response to the seller:

1) Repair/replace main plumbing waste line that is backing up and leaking in the basement.
2) Replace water heater that is beyond its normal life expectancy.
3) Replace the furnace in the basement that is not functional
4) All work to be done by a licensed contractor.
5) $2500 for a roof allowance since roof life is expected to be about 2 years.

The seller came back with the following response:

1) Seller will rod main drain although it was done 2 months ago.
2) Roof is not leaking and does not constitute a "defect"
3) Old water heater does not constitute a "defect"
4) Furnace does work. Pilot was just out and does not constitute a "defect"

I think the biggest issue at this point is the drainage, which we will ask to be checked by a licensed contractor.

But assuming the furnace works, water heater is certainly past its life expectancy. If the seller doesn't agree to replace it, can we back out of the contract if we wanted to?

As for roof, its not leaking, but the inspector said it will need some work in 2-5 years, so that's why we asked for the $2,500 allowance.

I am new to real estate investing, so I am not sure how to proceed from here. How do you guys deal with these situations? Thanks!

[Steve Babiak]

For items that will require imminent replacement, I like to fund the "maintenance reserves" that Peter mentions by lowering the offer price that I make; my offer would have been lower to start with (and probably rejected) :wink: