Home Buyers: Don’t fall in love with a house and ignore the old roof!
I bought my first home before I became a real estate professional. I was in that home for less than two minutes before I knew it was the perfect home for me.
Because I saw the home in daylight, I never noticed that there was no electricity in the detached garage. My cousin gave me an electric overhead garage door opener as a house-warming gift, which of course couldn’t be installed until I ran electric lines to the garage.
I also didn’t pay attention to the fact that “the new roof” advertised by the Seller was a third layer. That was insurable eleven years ago, but isn’t now.
The better insurance companies have the same basic criteria regarding roofs.
- If a roof is ten years old or newer, the property owner can purchase replacement cost coverage on the roof.
- If the roof is 11 – 15 years old, the insurer will write the property insurance, but only if they can write the roof on an actual cash value (ACV) basis.
- And if the roof is over 15 years old, most companies won’t write the insurance period.
By replacement cost, I mean the insured would get a new roof, less their deductible. For ACV, the company would depreciate the roof, and only give the value of what the roof is. So, if the roof was 20 years old, and it was originally roofed with shingles rated for 20 years, than the company could say that the roof is fully depreciated, and not give much to the insured as far as a claim check.
It’s okay to fall in love with your new home’s granite counter-tops, hardwood floors and landscaped yard – you’re SUPPOSE to do that.
Home Buyers: Don’t fall in love with a house and ignore the old roof!
But, please don’t overlook the big ticket items that can drain your bank account in the future:
- roof,
- electrical updates,
- plumbing,
- heating and air,
- hot water heater.
If you are selling your home and can’t afford to roof your home prior to putting it on the market, ask your Realtor about including verbiage stating that a new roof will be installed prior to closing. Many roofing companies work with Realtors and will install a new roof once you have a contract on your home and will wait to be paid out of your closing proceeds.
If you are buying a home and an allowance is made for a new roof prior to closing, ask about the type of shingles the Seller is planning to install and seek guidance from your insurer. You may want to upgrade to a better quality shingle and pay the difference.
Go ahead and fall in love with your new home. Just make sure your Realtor is investigating the condition of the higher repair and replacement components, and don’t ever skip the inspections available to you!
Lori Cain is a residential Realtor with Chinowth & Cohen Realtors, serving the greater Tulsa area, including midtown Tulsa, downtown, Owasso, Jenks, Sand Springs, Bixby and Broken Arrow. Visit Lori’s web site, LoriCain.com or call 918-852-5036.
