When Buying in Irvine, CA and Orange County, CA, What Condition Should Buyers Expect a Home to be in?
When buying a home in today’s housing market, as far as condition goes, be prepared for anything. Following are a breakdown of what is more typical for different types of sales.
Equity Sales, Occupied
You would think that when buying an equity sale, this category home would be in the best condition; but not always. This home owner might be selling because they’re low on funds and they’re looking to get out of a more expensive home; and they cannot afford to do repairs. Typically, though, the major items are there, but may not be working; and you may or may not be successful in getting the seller to cover the cost to repair them; however, this is your best chance to get a home in good condition.
Equity Sales, Vacant
A lot of owners have been relocated but had some equity in their home. Often they’ve done some expensive things like replace windows and put in lower-end carpet and paint just to spiff up the look; but everything else might be dated. Let’s say the owner passed away and someone else in the family, or the head of the trust, is handling the sell and knows little about the home. You have it inspected and in this particular case, the Seller was willing to do everything the Buyer had asked for. Then the new owner takes possession; and that’s when the trouble starts. The furnace has a cracked heat exchanger and needs to be replaced; and the water is backing up due to the root-bound pipes. The typical inspector would not necessarily have found either of these items. This is when having a good home warranty policy comes in handy; however, it’s still going to cost the new owner several hundred dollars. Oh the joys of home ownership…
Often, with occupied homes being sold short, it’s a guessing game as to what shape the home will be in when you take possession; though typically, the major appliances stay in the home. On a short-sale you rarely, if ever, get the seller to do any work. They might clean the home when they leave; and be thankful if they do.
If the old home owner is now out of the picture, at least what you see in the home is what you get. Typically the major items will not have been removed at the close if they’re still there when you see the home.
REO (Bank or Mortgage Holder Owned)
Some banks are willing to do a little to fix up a home; but they most often do it on the cheap. If there’s new granite or kitchen cabinets, it’s low-end, but at least you have granite and new kitchen cabinets. On a couple of my sales, where there had been mold in the home, I’ve seen where a bank says they’ll have it removed and then they hired a handyman who was not familiar with the proper way to remove the mold; and in fact, left some. Luckily, I caught it before they repainted; so as a Realtor, I’ve learned one must be more watchful with this type of sale.
Most of the time, in parts of Orange County, CA; an REO is a home you’re going to find in the worst condition. I’ve seen some properties that you don’t even want to touch the door knob and the carpet was so filthy every square inch was black. It’s not unusual to find a remodel halfway finished or baseboards removed; holes in the walls; or, air conditioning units, light fixtures, dishwashers, stoves and floor covering completely removed from the home. A lot of times, a bank will do nothing to revive this condition.
Sometimes the banks sell to a “flipper” or partner with a flipper and the flipper does the work. In either case, look for inexpensive paint jobs – did they repair cracks? Maybe they painted the tub, tile surround and sinks; and inexpensive flooring. It’s important that you choose a Realtor that recognizes the difference.
Corporate Sale (Business Relocation or a group of Flippers who now call themselves a Corporation)
You used to find this method of selling more typical in Irvine, California due to its proximity to business parks. This type of sale used to be the best to pick up as a Buyer, because the companies would pay points for the seller and help the buyer into the home. In addition, they’re willing to fix things; however, in this market, there haven’t been that many of the typical corporate sales. In fact, flippers are now calling their sales “corporate sales,” so it’s most important your Realtor makes the distinction. Remember flippers typically use low-end products, even when the home looks smashing.
The long and the short of it is, even with an inspection, the Buyer needs to be prepared to have some surprises after moving in. Choosing a Realtor that utilizes an inspector they have a long-term relationship with is very important. In my case, neither my inspector nor I are done just because the transaction might be. To learn more about how I work, visit my website by clicking here. To sign up for email notices of new blogs, enroll below.