How to handle city resale inspection fee?

Question

Hi, I have a property in which the city requires an inspection by a city official when a sale occurs. The seller has to order it.

It's $150 and if they request repairs, either the seller makes them or the buyer signs an affadavit agreeing to make the repairs. I don't mind eating the fee but how should I handle it? Have the buyer pay it and reimburse her at closing or something else.?

Thanks!

Chaz Reid · Answer

Are your numbers on the property worth it? It is just $150 for the inspection, but how will you handle the aftermath of the inspection. Here's what I would do if the numbers are already looking decent:

1. Pay out of pocket to get the inspection done. While the inspector is there, the property owner and my GC will be there as well.

2. Get a pricing on the needed repairs.

3. Talk to the owner to see if they will move on the numbers since this stuff needs to be repair, as they just witnessed.

4. Change my spread before I start marketing.

5. When the potential investors come check out the property, inform them that your numbers are calculated to include the mandatory repair per the city.

6. State it in the contract that the buyer knows about the repairs and blah blah blah...

But all of this is based on how promising the spread is looking RIGHT NOW. I don't spend money on stuff that doesn't make me money, but that's just my RDPD mindset.

Luiz Souza · Answer

Not sure about what type of deal you have going on there, that said this is what would do - Offer a couple of hundred dollars in repairs and see what happens?

LSouza