Real Estate Negotiating Bible Tip #3, What siding & paint is that?

One the good thing about the majority of houses you’ll deal with, is they’re usually older houses. In the past, I’m referring to the 1970’s and older, building supply companies created and distributed several building materials that’ve since been banned by the federal government. They got banned due to people getting long term sicknesses from exposure to these materials. Surely you’ve heard of a few of these materials like lead based paint and asbestos. The trick is to be able to identify where these materials are located in a house. There’s no way to 100% tell whether lead or asbestos is present without conducting a test. BUT, there are a few major items that typically contain both and you can use to your advantage when negotiating with the seller. The 1st large item to be aware of is asbestos siding. Some people call it cement siding because it cracks like cement but it does contain asbestos. You can identify this siding quickly by simply looking at it. I’ve included pics so you can see what it typically looks like. It has small groves from top to bottom and on older houses it can crack and have small pieces missing on the edge. It’s usually about 3ft long and about 1ft wide. It can also deteriorate while still on the house. It’s usually been painted several times and can be any color. Asbestos can also be found in floor tile. The tile appears to look like the thin sticky 12x12 vinyl tile you buy at home depot. But the difference is they put the asbestos tile down with black adhesive and not the yellow adhesive we now use today. So pay close attention to the flooring in the house when you walk thru. Asbestos floor tile can be any size as well. The 2nd item we’re looking for is lead base paint. This paint is typically found in ALL older houses, somewhere. It may be covered up by new paint but the threat of releasing it into the air by ripping out old sheetrock is still high. It’s even found around windows and to make matters worse, it could be painted over the asbestos siding. Now that’s a bad combination. Both of these materials must be removed by a person licensed to handle them. We’re not allowed to just rip this off the house. It’s against the EPA regulations for us to even handle these materials.  "So kris, how can this help me?"  Well, it’s your job to bring these items to the seller’s attention when you’re making your offer. Once you explain to the seller that you’re willing to take on the responsibility of removing and remediating all the asbestos and lead base paint, you can then explain why you need a steep discount. Let them know that you’ll handle all of the issues that may come up with hiring the licensed person to get it out. Remember, most people have heard of these two materials and they usually don’t want to deal with the headache. You can even offer to raise your price if they’ll get rid of the asbestos. I love doing that because I know they just want to get the house sold and move on. Use these banned building materials to negotiate your next discounted purchase. I just negotiated a deal down to $14k specifically because of these hazardous materials and I know this strategy will work for you…

I have included several samples of what asbestos can look like: 

The pic above is a house that the city assessor’s website labeled the siding as asbestos. I used that to negotiating a large discount. The assessor’s website can help you with determining building materials hence helping you negotiate better. Take a look at the next pic below...

 this is a close up of an asbestos shingle. Remember to look for the deep grooves that run from top to bottom. This shingle looks to have some wear on the lower left side. Notice the face of the shingle can be disturbed as well. These shingle will crack if hit hard, that’s another sign of asbestos shingles. 

Below, is a picture of asbestos floor tile. It can come in all types of sizes and colors.

Notice 1 piece is missing and another is damaged. There’s also the black adhesive on the floor used to lay this tile down. Now days this type of tile comes with the adhesive on the back of the tile and you don’t need to apply more adhesive to the floor. When it’s cracked it releases the asbestos into the air and gets into your lungs hence being a hazardous material. The only way I know to get this tile up is to bust it up. It’s in many rehab houses as well and can be a big problem. I've seen some rehabbers go directly over top of it with carpet or your hardwood flooring. That way you won’t have to ever disturb it.    I know this was a bit long and unusual for my negotiating tips, but trust me, using the hazardous material strategy will get you unbelievable discounts. The house above is assessed for $54k & I have it under contract for $14k. I used the asbestos shingles to help get me that discount. Don’t forget to push off the obligation of dealing with the hazardous materials onto the seller 1st, to get a feel of how motivated they are. They usually want nothing to do with asbestos and will shy away from even talking about it. That’s when you know you’ve got a good topic for discussing your discount.

ps- please share any other building material tips you've used to get a nice discount...

 Good luck, Kris Haskins