Real Estate Success

With a large inventory of vacant homes on the market today due to foreclosures, probates and relocations, buyers should be aware of problems that often arise when a home is left unoccupied for a period of time.

Problems are more likely to arise in homes that are left vacant and not maintained regularly. While these homes, especially foreclosures, can often be purchased at below-market prices, buyers should pay added attention to their condition, be sure to have them thoroughly inspected by a professional, and be aware of potentially higher costs for repair and maintenance.

The most common problems that are more likely to occur in a vacant home include:

Plumbing — Plumbing problems can arise with unused drain pipes which are susceptible to waste solidifications and can also be ideal nesting grounds for rodents and pests. Restrictions in water flow can also be caused by sediment blockages. Washers and gaskets may also dry out, shrink and cause leakage from pipes and fixtures.

Water Heater — Sediment buildup from stagnant water in an unused water heater can impair its proper function. Thermal shock from re-ignition after a period of non-use can lead to leakage and failure.

Roof — Leakage may occur due to water buildup when roof and drains are not properly maintained and clear from leaves and debris. Deferred maintenance of flashings can be another source of leaks.

Soil Expansion — Yards of vacant properties are often neglected. Soil that loses its natural moisture when deprived of water may expand once the new homeowner begins to maintain the yard, creating upheaval problems that can affect the home’s foundation.

Thermal Expansion — Unlike occupied homes that are typically maintained at an average 68 to 70 degrees, temperature changes in vacant homes can lead to thermal expansion in metal window frames, hardware and rubber products such as weather stripping. This condition can cause cracks around windows and in weather stripping, as well as binding of hardware. Moisture and temperature changes in lumber can also lead to plaster and drywall cracks.

Mechanical — When activated after a period of non-use, furnaces can develop hazardous cracks in their heat exchangers, and air conditioning systems may be found inoperable. Grease bearings in fans and pulley motors of HVAC systems and bathroom exhaust fans can freeze up.

Appliances — Dishwasher and garbage disposal motors can freeze up, and seals can dry out and leak with a period of non-use.

At the very least, buyers of owner-occupied properties are provided with disclosures about the condition of the property by the seller and seller’s agent. However, many foreclosed and probate properties are being sold without the standard transfer disclosure statement (TDS) since financial institutions and trustees typically have little knowledge of the property and are exempt from a major portion of the transfer disclosure law.

In addition, foreclosed properties frequently suffer from deferred maintenance, can be left in a poor condition — even vandalized, and are often hastily repaired using unprofessional labor.

Buyers should obtain a comprehensive inspection by a qualified inspector who is trained to identify more subtle as well as obvious conditions that might present problems. Based on the results of the inspection report, buyers should rely on the expertise of a real estate professional to assist in negotiating the appropriate repairs or price adjustments.

Technorati Tags: real estate investing