Welcome back to my series, Demystifying the Real Estate Offer. Today we are going to explode radon and termites at the house you are now under contract on. Let’s talk about what can go wrong and how you can avoid it.
Let’s start with radon.
Radon is a colorless, odorless gas that is naturally occurring in the ground. When radon is trapped inside our homes, you are more exposed to it and over time it causes lung cancer. This is the second leading cause of lung cancer after smoking.
According to the EPA, the level of radon in your house should be kept below 4 pCi/L. You can test this with at home kits or you can hire a professional to test the levels.
So let’s get back into our transaction, our home inspection is currently blowing up and the seller is already mad at us. And, you just decided that you want to test for radon.
Guess what? You don’t have the right to test the levels.
In order to test the level of radon in the house, you need to have built in a radon contingency. This contingency gives you the right to test the levels and if the levels come back too high, to negotiate with the seller to remediate it or give you a credit so that you can remediate it. This is often done by installing a system that expels the air up and out of the house. The cost on these systems can vary, but think about $2000. Well you can’t test, so you don’t know what the radon levels are and you can’t negotiate, so you just bought a house with or without its radon.
I do the majority of my business in Montgomery County Maryland so we do need to just note how they are different. In 2016, Moco passed a law requiring a radon test be done on all sales (with a few exceptions like condos, houses in the city of Rockville). If the buyer does not do a radon test, the seller must perform it and provide it to the buyer. The seller does not need to remediate it. If the buyer has a radon contingency, they will pay for the test and can negotiate it.
Termites is a different ball game all together.
The buyer gets to (at their expense, except for VA loans) have a wood-destroying insect inspection by a licensed pest control firm. If you do an inspection and the inspector finds evidence of live wood destroying insects and/or repairs for damage caused by them, the seller has to pay to correct the situation at their expense.
The biggest way to screw this up is not to do a wood destroying insect inspection. They tend to be pretty inexpensive, think $50. The sooner you get it done, the better because the seller needs time to make repairs before closing.
Most agents see minor damage that needs to be repaired from time to time, or the house needs to be treated to kill the live termites (or other WDIs). But every now and again, you will find a house that has been completely eaten by them. A lot of times with this situation, the buyer ends up walking away. This is another good reason to get the inspection done during your home inspection window to give you a chance to exit the transaction if needed.
Those are a lot less intense than the home inspection, but still important. Next up, we blow up the appraisal.