Negotiating a repair addendum

[Chris Shepard]

Hi all,

I am currently in my inspection period on a 9 plex and I did my walk through and inspection earlier this week. 

The property was advertised as “plenty of room in the price to make necessary improvements”.  And I assumed there was somewhere between 100k-150k in repairs that would be necessary. 

After my walk through I found that the property was built in 1978 and absolutely nothing has been updated in 40 years and as well opposed to having standard baseboard heaters, there are forced are furnaces (which are all 40 years old).  And on top of that, one of the duplexes is in terrible condition and has a major mold problem.  The seller said they thought that was repaired and they have a warranty for it.  Something they did not disclose in their property disclosures...

Anyway, I did my due diligence and found there was about $230k to $250k of work that would need to be done.  I sent the repair addendum over saying that I had budgeted for $135k based on their pricing, but the I would need 95k in price reductions or closing costs to continue.  

My expectation would be that the seller would counter back and we would meet somewhere in the middle.  The response I got was (note I am the broker and the buyer on this property), you are getting a 40k commission on this property, the seller rejects your repair addendum.

In all of my experience, having bought and sold about 20 fourplexes and 50 single family homes, I haven’t had seller straight reject a repair addendum and especially not one in this condition.

One item of note is that the seller is either from China or is a Chinese-American.  I am a little thrown off by this seller’s behavior.  Does anyone have any experience negotiating with a foreign national?  What are your thoughts on my next move?

Thank you in advance for your responses.