Can You Sell A Home with a Code issue?

You may have buyers – cash or traditional – who will fall in love with something about your home  Maybe it’s the crown molding, or original hardwood flooring, but that charm won’t save you from code violations. If you do hear that your home isn’t up to code, it’s not all doom and gloom. You can sell a house with code violations, and you’ve got some options to move the deal forward:

  • You can attempt to fix the issue quickly and cheaply.
  • You can lower the asking price, or give the buyer a credit
  • You can sell the house “as-is” to us, a cash buyer

What does it mean if your house isn’t up to code?

Building codes are meant to protect public health, general welfare, and safety in terms of construction and occupancy  Each municipality differs, and rules can change quite frequently  

Along with local codes, there are nationwide codes such as the NEC (National Electric Code) detailing safe electrical design, installation and inspections. The code has been revised several times, meaning what was considered safe in your home years ago may not be up to code today. 

Not being up to code could mean citations, violations or fines for any number of issues that crop up. Additionally, you may be subject to HOA (home owner association) codes that you must keep up with. City fines for code violations are also no joke and can accrue on a daily basis.

Common code violations that crop up in a home sale

Building code violations can range from simple fixes to major repairs that require a professional. Some of the most common code violations are:

  • Incorrectly placed smoke alarms
  • Hand rails that don’t turn and end into a wall
  • Missing – or defective – GFCI (ground-fault circuit interrupter) on kitchen, bathroom, garage and outdoor outlets
  • Bathroom fans that don’t fent outside
  • Missing deck flashing between a deck ledger board and the house preventing wood rot and keeping the deck stable

We frequently see that electrical panels need to be brought up to code; usually because of the age of the house. 

Other electrical problems that can turn up include inadequate amp circuits. Kitchen and utility areas generally require 20-amp circuits and all lights and other 120-volt circuits typically use 15 amps. 

Your options for selling a house with code violations: Fix it, lower the price, or sell “as is”

Option 1: Fix the issue to move forward with the sale.

If your home has any code violations, you may be able to fix the issue(s) before listing or closing. Whether you decide to with this option will likely depend on the scope of work that needs to be done, as well as the housing market. 

Option 2: Offer a credit or lower the price

If you aren’t financially capable to make repairs, you can offer a credit at closing, or accept a smaller bid. This option is usually viable if the violation doesn’t present a safety or health threat to the buyer. You will need to be completely honest with any issues and have the house properly inspected. Be prepared to accept at a discounted price, though  

However, there is another option: to sell your house for cash to a direct buyer.

Option 3: Sell your house ‘as is’ to a cash buyer.

We understand that most homeowners’ top priority is to get top dollar when selling their house. This generally means listing on the market with a licensed real estate agent. Unfortunately, not every seller has the cash on hand or timeline to fix expensive code violations. 

That’s when selling the house “as-is” before it goes to market to an investor becomes a good option, even if it means taking a price cut. Cash sales are faster than traditional sales, meaning you can close very quickly. In fact there are some states where you can close in as little as 3 weeks. Many buyers will make an offer on the house within 24 hours as well. 

If you are curious about this option, visit our homepage and fill out the form – signaturehomebuyers.com. We offer a no obligation all-cash offer on homes. If you don’t like the offer, you don’t have to do anything with it.  

The bottom line on selling a house with code violations

Assuming you have a clean title with no liens or violations, anything is fixable provided you have a good market and a flexible buyer. 

At the end of the day, it comes down to this: assess the damage, read the market and play your cards right. 

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