How Will My Roof, A/C and Insurance Affect My Home’s Value and Ability to Close?
How Will My Roof, A/C and Insurance Affect My Home’s Value and Ability to Close?
You find a buyer, agree on a price and start planning your move. Then the inspection comes back.
The roof is older. The A/C is near the end of its life. The buyer’s insurance company wants more information.
Suddenly, a deal that looked easy may be in trouble.
In South Florida, the roof, A/C, electrical system and plumbing can have a big effect on both your home’s value and the buyer’s ability to close.
Why Insurance Matters
Most buyers need homeowners insurance before their lender will approve the final closing.
Older homes may also need a four-point inspection. This looks at the roof, electrical system, plumbing and heating and air-conditioning system.
A home can look beautiful and still be hard or expensive to insure. If the buyer cannot get coverage, the sale may be delayed or canceled.
How an Older Roof Can Affect the Sale
The roof is often the biggest concern.
Insurance companies may look at its age, condition and remaining useful life. Missing tiles, leaks, damaged areas or poor repairs can cause problems.
Even when an older roof is still working, buyers may worry about the cost of replacing it. That can lead to lower offers, repair requests or a buyer walking away.
A newer roof can make the home easier to insure and more attractive to buyers.
What About an Older A/C?
An older A/C system does not always need to be replaced before selling.
If it cools the home well and has been maintained, it may still be acceptable. A recent service report can help give buyers confidence.
Problems such as leaks, rust, poor cooling or damaged wiring may need to be repaired before closing.
Should You Replace the Roof Before Listing?
Replacing the roof may make sense when it is leaking, damaged, near the end of its life or likely to keep buyers from getting insurance.
A new roof can make the home easier to market and remove one of the buyer’s biggest worries.
Keep all permits, invoices and warranty information. These records may be important to the buyer and insurance company.
Should You Offer a Credit Instead?
A credit may work when the roof or A/C is still usable and the buyer wants to choose the contractor or materials.
However, a credit does not fix an insurance problem.
The buyer may still need an acceptable insurance policy before closing. The lender may also limit the amount of credit the buyer can receive.
That is why a large credit does not always solve the problem.
The Smartest Step
Try to find these issues before the buyer does.
Before listing, consider getting a roof inspection, four-point inspection, insurance review and A/C service.
This gives you time to repair the problem, replace the item, adjust the price or explain the condition clearly.
Finding out early gives you choices. Finding out a few days before closing does not.
The Bottom Line
You do not always need to replace every older item before selling.
What matters most is whether the roof, A/C and other major systems are working, safe and acceptable to the buyer’s insurance company and lender.
Sometimes replacing the item is the best choice. Other times, a repair, lower price or buyer credit may work.
The right plan depends on the home, the buyer’s loan and the insurance company.
For More Information, Contact:
Chriz Tokar and Bruce Field
954-600-7427
The Chriz Tokar Team
RE/MAX Advance Realty
Florida insurance guidelines and individual company requirements can change. The information above is general education and should not replace advice from an insurance agent, lender, inspector, contractor or attorney.
