Everything You Need to Know if the Roof is Nearing 20 Years . . .

When it comes to keeping home sales together, the age and condition of the roof often dictates the success of the transaction. The script is predictable. The buyer and seller agree to a price and the inspections begin. The inspector states that the roof may need to be replaced and they recommend the buyer have it further evaluated by a licensed roofer.  

If the roof is nearing the end of its life, the roofer will provide the buyer with a replacement bid, and the buyer’s agent will deliver it to the seller’s agent claiming that the roof needs to be replaced prior to closing per the inspection and the professional roof evaluation.  

In most cases, sellers are caught off guard, because everyone is led to believe that their roof has a 25, 40, or even 50-year roof warranty. It is often viewed by the sellers as a negotiation ploy when there is clearly no reason to replace a roof that is performing perfectly well. Since the roof has never leaked, and it may be only 20 years old, this is surely a racket.  

So, who is right? How do you know who is honest? How do you get reputable information? 

First, I remind sellers that all buyers would prefer to have a clean, perfect inspection. They would love to avoid a significant maintenance expense early in the ownership process. Second, most purchases are financed, and lenders may require a minimum of a 3 to 5-year roof certification. They often cannot get the financing unless the roof is deemed to have 5 years of life remaining. Finally, the entire process requires patience and research. Typically, we seek out a couple of replacement bids and/or maintenance bids to begin assembling numbers. Data provides confidence. 

What is a fair solution? Typically, if the roof is repairable for say $5,000 in replacement shingles, a seller will agree to do this work in hopes that the buyer will accept this solution. If the roof is beyond repair work, or if it is a composite product, then the only solution is full replacement. It is customary for the buyer and seller to split the cost of the roof evenly. Most often, the seller’s preference, if it is acceptable to the lender, is to credit the buyer for half the roof cost or to lower the sale price by that same amount. However, if the buyer or their lender insist that the roof be replaced prior to closing, the seller can agree to do this provided the work can be completed on time. As a seller’s agent we would then ensure that all other contingencies are removed and that the earnest money be released to the seller before our client makes such a large financial commitment.  

It is not uncommon for these negotiations to fail. Sellers often do not understand that a new roof does not materially change the value of the home and that buyers are not willing to pay a competitive price for a home and take on a $20,000-40,000 roof expense. It is like buying the same car with bald tires or new tires; the value of the car is still somewhat the same.  

No one wins if we do not come to an agreement. The buyer will lose $1,200 in inspection costs, two weeks of time, and will need to start house hunting again. The seller will typically move forward with the roof repair/replacement after all or be upfront with the next buyer that they will provide a credit for the roof. Additionally, the seller will go back on the market as a “BOM” status, which means their home was under contract, but it now it is “Back on the Market”. This status leads to very direct questions that often give buyers concerns prior to stepping foot in the home. So, it is important to have your re-entry plan in place. 

Finally, proactive sellers always win. If you know your roof could be an issue, address it before you go on the market. It is no different than buying a used car; we all love to buy from those owners who keep meticulous records and keep their car garaged under a cover 😊.