Rehabbers: Do you create an owners manual for the homebuyer?

Question

I work in commercial construction and typically an owner will request an owners manual with a list of product installations and their associated warranties.

I think it would be a great marketing strategy for rehabbers to create an owners manual that gives product descriptions of every new and updated items/equipment in the home with their warranties.

I think some homebuyers are wary about buying a rehabbed home, simply because they do not know if the project was done right.  The manual could have a copy of the building permits pulled, photos of construction in progress and cut sheets of construction assemblies/standards used during the project.

For example, if a bathroom was remodeled, take pictures of the waterproofing membrane, provide product specifications, maybe even provide a mockup for the homeowner, so they know that everything was done right and by the book.

This will reassure a homeowner that you didn't just slap some lipstick on a pig to sell it to the first sucker.

I think this is a good business practice for any rehabber/remodeler who is remodeling per code and using best construction practices.

If you are doing things right show it off!

Let me know your thoughts.

Thanks.

J Scott · Answer

I don't give "owners manuals," but if it's a property where I did a full remodel, I'll hand my business card to the buyer at the closing table and tell him/her to call me if they have any issues.

If there are (reasonable) issues, I'll happily have my guys fix the problem for free, as there shouldn't be any problems on a newly renovated property.

Chris Calabrese · Answer

We try to give them as much information as we can, such as all warranty information and manuals, contact information for key subs who provide labor warranties (i.e. roofers), pest control/termite bond info, etc.  We also make sure to leave touch-up paint with the colors labeled.  I also try to leave some small samples tile and wood flooring, with the brand written on the back, so they can take them to match paint, furniture, etc.

We also like to walk-thru our rehabs with the buyers after doing inspection repairs and explain various features, much like the new homebuilders do.  It is comforting, especially to anxious first-time buyers, to meet us and see that we are professional and thorough, and not just the stereotypical greedy investors.

Will Barnard · Answer

I also think this is overkill and do not do it. I also agree that you open yourself up to providing the other party ammo to sue you if anything goes wrong. This is what all the disclosure forms are for.

I do provide the buyer with any kitchen appliance manuals and warranties, as I always put new in, but that is about it. I also provide the brand and clor code for all paints used (plus some touch up will be left in garage for them) and also (when i have them) leave some tile, stone, carpet overs for samples and minor repairs.

While I have confidence in my crew's ability to perform quality work and quality materials, one must realize that with government intervention, it makes our jobs difficult at best. One may consider that code in an area may require a permit for something as simple as changing out a toilet, yet a rehabber can't possibly turn a profit if they pulled a permit for every single little item needed.
With regard to adding square footage, changing configurations, etc, I would always recommend it be done with full permits, but on other items, I would not make the same recommendation even though it may be code.

Steve Babiak · Answer

I have done the "owners manual" thing with flips, and I do it with my rentals.  I include manuals for anything that is in the house (heating system, thermostat, appliances, etc).  I include some info on basic lawn care, and the utility companies.  All inside a 3-ring binder.  I'm thinking of moving to all electronic PDFs, but the size of the scanned stuff can get pretty large - and the hard copy is useful anywhere in the house, not just wherever a computer is.

I don't go to the extreme of photographing every step in the contruction process.  I just give the "finished product" that extra bit of "finish" with a manual intended to be helpful.

Now, if there is something like mold remediation that was done, you might want to include warranties for that sort of thing since your seller's disclosure will likely have a line explicitly mentioning this sort of repair.  But I think if you give them too much, it could also make them ask questions for things where maybe you didn't touch anything - "why aren't you showing pictures of what's behind every wall" type of stuff.

James Vermillion · Answer

In a way being very public could help in certain cases.  It will show that you are not trying to hide anything and highlight your reputation and previous business dealings.   The potential of someone using that as ammo in a lawsuit is far less than the potential benefits.

David Robertson · Answer

Good input, I'm not sure if I understand the ammo to sue comments if you disclose too much...You only provide the homeowner ammo if things were not properly installed or not per code in the first place...

If anything if you show proof that you pulled permits for reasonable items and show evidence that you remodeled to current building standards and practices, that should be enough to limit your legal liability.  Honestly, the best way to limit your legal liability is to do everything correctly and show a good faith effort that you did everything per code.

Building permits don't kill deals, and if you included the costs in your remodeling budget, it's just another cost of work item.

Personally, if I walked through a flipped house and knew that permits weren't pulled, and had no proof that everything was installed per code, I wouldn't buy it...

Jscott, I think that is a good idea to leave a business card.  It's a good way to show the homeowner that you care and will be accountable for any reasonable issues that arise.  If there ever are any issues, correcting them could be costly upfront, but not correcting them could cost you your reputation.

J Scott · Answer

Anyone can sue anyone for anything, but they actually have to prove you did something fraudulent, negligent or otherwise illegal to win.  So, as long as you don't do anything fraudulent, negligent or otherwise illegal, i wouldn't worry too much...  :)

Luis A. · Answer

I don't know if you guys have considered the possibility of someone intentionally looking for some kind of ammo to use against you to bring up a lawsuit. Not because there is anything wrong with the house but because they smell money...

J Scott · Answer

We never put addresses on our blog.  But, if a buyer sees our company name on our For Sale sign (or somewhere else) and Google's it, they'll find my blog.  From there, if they look at the House Pictures, they can easily figure out which house they're buying and then read all about it.

It's only happened a couple times, so it's not too concerning, and I have a feeling a lot of buyers wouldn't be bothered by knowing anyway.  But, there are always a few...

Will Barnard · Answer

J  Scott - I think your perception and concerns are valid, yet your benefits of the blog are worth having. Perhaps not displaying addresses to photos on your blog would help "hide" the new buyer's home . . .?

Rehabbers: Do you create an owners manual for the homebuyer?

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