When is it too late to further negotiate?

Question

I recently won a bid on a duplex I plan to do owner occupied in.  Following the inspection we found a number of small to medium items that will need to be addressed (older boiler, sewer pipe needs replacing, chimney needs some work, termites, etc) and a larger item that has brought me the most concern.  This larger item is the existence of knob and tube wiring.  I brought in an electrician who gave me a base bid of $8.9k to deal with everything in the inspection and replace knob and tube in the basement, with an ad alt bid of $14k to do everything and rewire the entire house (also just realized today that this bid did not include any repair from damage to floors or walls that will be done).

With that info we went and asked for $16k off the price to cover most of the repairs.  The original bid was $275k.  They ended up saying they  had a cash offer at $260k so they would let me match this.  I took that offer and now have the house at $260k but I need to get all repairs done.  The inspection period is officially over.  I've been thinking and I've now realized I think I should have held out for more.  When I ran the numbers I was confident in going up to $280 and still have a solid deal.  So now I am becoming unsure about if $20k will be enough to rewire, deal with termites, fix any plumbing that needs fixing, and get the boilers serviced.  There are several other little things I can do myself but it'll add up as I do things like buy new fixtures, bathroom fans, cabinet handles, etc.  Plus it sounds like I may be unable to rent it out for a month or two while all this gets scheduled and dealt with meaning I'm losing out on potential thousands in rent while I'm paying the full mortgage (not a problem but I'd obviously prefer not to).

Now that inspection period is over and I did have a counter offer accepted would it be stupid to go back and ask for more money off?  Or to have them cover my closing costs?  Is it too late to even do so?  I just don't want to end up getting a bad deal here due to this electric issue.  If it wasn't for the knob and tube I wouldn't even hesitate on this at all.

Russell Brazil · Answer

You are past your inspection contingency date. It is too late to do anything.

Ronald Starusnak · Answer

Warren there is a time to listen to your guy and a time to take risks. Imagine flipping a coin, no matter what the outcome; the second that coin goes in the air you will know what side you want the coin to land on. It's a good way to help figure out what you are truly thinking. I walked away from an excellent flip because of septic issues before and don't regret it. I abandoned my $1,000 deposit.

Warren West · Answer

@Ronald Starusnak I did have a guy I know who owns a boiler company check it out and while he said it is 25 years old he also said that with proper servicing it could potentially last a few more decades.  As far as the termites, I got a treatment quote of $700 and during inspection he only found one small spot with evidence of termites.  The sewer pipe that needs replacing is just the large one in the basement, was told by multiple sources it is a PVC replacement and should run me about $300-400.  The roof is newer and the attic was converted into a master bedroom for one of the units.

The inspection period has ended already so I'm not sure of my options from this point with any further negotiations.  The biggest curve ball to me was realizing that repairs after the knob and tube swap out are not part of the bid for replacing it.  Also, finding that many people see knob and tube as a pain and don't want to take on the job.

Ronald Starusnak · Answer

I would walk, why are you so anxious to operate at thin margins? A boiler to be replaced will be $4,000-$8,000; the sewer pipe issue can be a massive one if line is snaked all over, termites means rotted framing most likely, another expensive repair. These are not small problems. I am a general contractor with plumbers in my employment and we still almost NEVER move plumbing drains if we have to or replace them. It's a huge headache.

Knob and tube wiring means the house is most likely framed with rough cut framing which also tells me you probably have a lot of dry rot damage, the walls won't be drywall, they will be plaster and lathe which again means you'll have a much more expensive patch or repair and it will never look right unless you do the whole thing in drywall. How's the roof? Older homes weren't insulated, if you're paying the utilities you could lose a lot of money.

Theresa Harris · Answer

Once all the contingencies are removed, the only out is you backing out of the deal and losing your deposit.  If your electrician gave you an estimate of $9K, and you got $15K off prioritize the items that need to be replaced or repaired.  If they had another offer for $260K and you didn't take it, you risked losing the deal (which may be fine).

As you plan to live in one half, start the renos on the other half, so you can get it rented ASAP.