The Seller’s Disclosure isn’t perfect; it isn’t the market … Deerwood Realty and Friends…Ep. 22

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Thoughts/Questions

Smith-8 ft retaining wall collapsed…42-64k
Felt- fix and flip, 102k to 195k…mold rotting wood in basement and foundation wall beginning to bow and crack.

Both buyers used Realtors and inspectors

1. “Are people really being honest when they check those boxes?” Smith asked. “I thought everyone was supposed to act in good faith.” So, I don’t believe that people act in good faith. And, if there isn’t a problem apparent, they aren’t going to disclose something they know nothing about.
2. Inspector noticed the bulge and the sellers credited the buyer $2,800 for the wall. So, buyers knew about the wall, just not the severity of the wall. What do you think about this?
3. The disclosure for the Felts said that owner had never lived in property(very common on a seller disclosure) There was an statement about known water problems and foundation in the basement.
4. The Iowa Code Says “all known conditions materially affecting the property.” What happens when you as the seller don’t know? This is the issue. If you as a seller get something repaired by a reputable contractor, the problem never reveals itself during the time you own the home after…you think it’s fixed and it may not be.
5. Realtors for the most part, have no idea what sellers do with their houses. They have to rely on what the sellers say.

Some tips and thoughts from me
1. Be skeptical of seller’s disclosures.
2. Be skeptical of repairs performed. Why do you give credit to seller repair contractors when you may even have issues with contractors you’ve used in the past?
3. Fix and flips are flat out dangerous. People can have the work performed to bring the property up but they have no idea if their repairs worked…..and they no longer own the house
4. Realize that some things will happen when you buy a home. You or your inspector may not see something and the sellers may never have known there was an issue. This isn’t something that can be disclosed
5. As a buyer, consider reasons to walk from a property versus reasons to buy. That is, if something seems off….just move on. There will always be another house. This is the case in any market.
6. Buying a house with a known issue and then suing or looking for remedy is just a bad plan…in my opinion…it’s better to just walk away
7. These types of problems arise when buyers and sellers come into contact with a very sophisticated and regulated industry(real estate sales) …They use their experience in other aspects of their life and it just doesn’t relate. For example, I suspect a structural engineer buying a home rarely buys a house where he thinks there are structural issues with a home. A schoolteacher on the other hand, has no idea how the many components work together in a home.
8. Real Estate agents are not experts in construction, mold, or anything else…they are working as an agent to help buy or help sell a home. I personally use my experience over the years or a good hunch here and there to identify properties that buyers may not be aware of that are possibly trash and ones to avoid.
9. People get sucked in by pictures online and it can cost dearly. Lipstick on a pig is definitely true for homes.
10. THIS is where real estate agents get bad reputations….and I don’t know the answer because this is not a legislation issue.

Source https://www.desmoinesregister.com/story/news/2021/06/21/disclosure-failures-more-likely-des-moines-metro-housing-market-home-buying-realtors-watchdog/7729698002/

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