Run of the Mill or Run for the Hills? Understanding Common House Conditions Presented By: Alan...

“Run of the Mill” or “Run for the Hills”?Understanding Common House Conditions

Presented By: Alan Carson and Andy TranCarson, Dunlop & Associates Ltd.

Carson, Dunlop & Associates Ltd. is solely responsible for the content of the material used in this seminar. © 2012

8 Common Issues

1. Wet basements2. Old roofs or leaky roofs3. Old furnaces and boilers4. Old air conditioners5. Knob-and-Tube wiring6. 60-Amp electrical service7. Aluminum wiring8. Vermiculite insulation

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Wet Basements

• What it means• Water in the basement can be a scary thing for any

potential homebuyer• Older unfinished basements might have water

leaking in (not unusual)• Greater concern if the basement is a finished living

space• The remedy to deal with wet basements depends on

different circumstances

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Wet Basements

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Wet Basements

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Wet Basements

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Wet Basements

Some Perspective• A large number of basements leak at some point• Weather dependent• Largely depending on water management from

exterior of the home

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Wet Basements

What do home buyers think it means? • The foundation is damaged• They may need to waterproof the foundation• They will have to spend a lot of money to correct the

water leakage

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Wet Basements

What does it really mean? • Sometimes, the client is right• More commonly, this is typical• This is rarely a structural problem• If water accumulates on the outside, it will leak inside• Higher costs to repair if basement is finished

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Wet Basements

Any chance the basement will be wet here?

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Wet Basements

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Wet Basements

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Cleaning the gutters often cures the wet basement!

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Sometimes we need to fix them!

Wet Basements

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Wet Basements

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Wet Basements

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What do we say to clients?• We see this in a majority of homes• Many basements leak at some point• It is rarely a structural problem• It is easily corrected in most cases

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Wet Basements

Old Roofs or Leaky Roofs

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Description• Old roofs – near or past end of life• Leaky roofs – isolated areas of water penetration• May be able to determine approximate age of roof

when outside• Can usually see water damage inside the home

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Old Roofs or Leaky Roofs

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Old Roofs or Leaky Roofs

What do home buyers think it means? • The entire roof needs replacement• The house is not well maintained• There is probably concealed damage• They will need to spend thousands

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Old Roofs or Leaky Roofs

What does it really mean? • There is probably an issue at a flashing or joint• Most leaks are the result of a localized issue• The roof is actually old and needs replacement

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Old Roofs or Leaky Roofs

Worn out Roof 20-year old shingles

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Really Worn out Roof!

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Minor Roof Leak

Can you guess where this roof may leak? 28

Flashing Leak

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Flashing Leak

What does it cost? • A non serious roof repair is usually a few hundred

dollars.• The new roof covering is several thousand

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Old Roofs or Leaky Roofs

What do we say to clients?• We should fix the leak!• Minor roof leaks are not unusual• Roofs are consumables

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Old Roofs or Leaky Roofs

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Old Furnaces and Boilers

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Old Furnaces and Boilers

Indications that it is old:• The seller informed us• Furnace shows manufacture date• Non-functional• Red-tagged by technician• Appears to be older and there is visible damage

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Old Furnaces and Boilers

What do home buyers think it means? • House is in bad shape/poorly maintained• All other components will be near the end of their life• The cost to correct will be huge

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Old Furnaces and Boilers

What does it really mean? • Old/defective mechanical equipment is not related to

condition of house• Does not mean all systems are old• May need repair OR replacement

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Old Furnaces and Boilers

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Old Furnaces and Boilers

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Old Furnaces and Boilers

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Old Furnaces and Boilers

What does it cost? • Repairs cost depends on issue• A new furnace or boiler is typically $4000 to $8000• As of 2010, all new furnace installations must be high

efficiency• Still some grants from utilities and municipalities

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Old Furnaces and Boilers

What do we say to clients? • Determine first if it’s repair or replace• Furnaces and boilers have a life cycle• Lifespan can be 15-30 years

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Old Furnaces and Boilers

Old Air Conditioners

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Indications that it is old:• The seller informed us• A/C shows manufacture date• Non-functional• Appears to be older and there is visible damage

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Old Air Conditioners

What do home buyers think it means? • House is in bad shape/poorly maintained• All other components will be near the end of their life• The cost to correct will be huge

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Old Air Conditioners

What does it really mean? • Old/defective mechanical equipment is not related to

condition of house• Does not mean all systems are old• May need repair OR replacement

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Old Air Conditioners

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Old Air Conditioners

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Old Air Conditioners

What does it cost? • Repairs costs are typically inexpensive• Compressor replacement can be over $2000• A new air conditioner is typically $3000 to $5000

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Old Air Conditioners

What do we say to clients? • Determine age of system (repair or replace)• Air conditioners are consumable components• They last about 15 years

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Old Air Conditioners

Knob-and-Tube Wiring

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Description • Used in all homes up until about 1950• Good-quality copper wiring, with no grounding• Separate cables for black (hot) and white (neutral)• Can be an issue with insurance companies

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Knob-and-Tube Wiring

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Knob-and-Tube Wiring

Knob-and-Tube Wiring

Knob-and-Tube Wiring

What do home buyers think it means?• The house is poorly built• The wiring is unsafe• They will not be able to get insurance

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Knob-and-Tube Wiring

What does it really mean? • The house is like every other house built before 1950• Not unsafe, unless it has been tampered with

incorrectly• Insurability will depend on extent of wiring and

insurance company

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Knob-and-Tube Wiring

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Knob-and-Tube Wiring

What does it cost? • Rewiring may cost $1,000-$2,000 per room and $10k

to $15k for average house• This is a significant upgrade, not a repair• Interim solution - GFCI outlets - $50-$100 per circuit

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Knob-and-Tube Wiring

What do we say to clients? • This wiring is what we expected to find • The wiring is usually safe but should get Electrician to

verify• Check for insurability before purchasing• This cost is significantly reduced if done when

renovating

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Knob-and-Tube Wiring

60 Amp Electrical Service

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60 Amp Electrical Service

Description • An electrical service typical of older homes• It may be too small for modern lifestyles• It is not a safety issue• It can be an insurance issue

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60 Amp Electrical Service

What do home buyers think it means?• The house is poorly built• 60 amp service is unsafe• They will not be able to get insurance

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60 Amp Electrical Service

What does it really mean? • It doesn’t have anything to do with the quality of the

home• It is not a safety issue, but a capacity issue• Many insurance companies require the service to be

upgraded to 100 amps

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60 Amp Electrical Service

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60 Amp Electrical Service

What does it cost? • $1000-$2000 to upgrade to 100 amps• Often included with other improvements

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60 Amp Electrical Service

What should you tell your clients? • Nothing to do if capacity is adequate• Allow for possible replacement depending on lifestyle• Check with insurance company. They may require a

100 Amp service

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60 Amp Electrical Service

Aluminum Wiring

Description • Commonly used from mid-60s to late-70s

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Aluminum Wiring

Description

Pre-1972 • AKA as Utility Grade Aluminum• Higher aluminum content (softer)• More prone to overheating

Post-1972 • AA-8000 series Aluminum• Better alloy• Stronger and more flexible

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Description

Pre-1972 • Lots of poor connections• Should upgrade using “COPALUM”

Post-1972 • CO/ALR devices required• Performed similar to copper• Problems with twist-on connections

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Aluminum Wiring

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Aluminum Wiring

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Aluminum Wiring

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Aluminum Wiring

What do home buyers think it means? • Inferior quality home• Unsafe wiring• Cannot get insurance

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Aluminum Wiring

What does it really mean?

• Very common in many houses in Canada• Safe if connections are done properly• Can be a minor insurance obstacle• Will need inspection/updating

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Aluminum Wiring

What does it cost?

• $600 - $1200 for a thorough inspection.• $500 - $1500 to improve connections.

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Aluminum Wiring

What should we do about it? • Check insurance requirements• Have Electrician inspect and update as required• Possibly inspected by ESA

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Aluminum Wiring

Vermiculite Insulation

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Description • Loose fill insulation used up until the 1980s• May contain small amounts of asbestos

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Vermiculite Insulation

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Vermiculite Insulation

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Vermiculite Insulation

What do home buyers think it means? • The home is a health risk• Will affect property value

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Vermiculite Insulation

What does it really mean? • Nothing, for most homeowners• If you are going to be working in the attic, you should

take precautions, like wearing a mask

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Vermiculite Insulation

What does it cost? • Nothing if left alone• Removal (asbestos abatement) costs thousands of

dollars

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Vermiculite Insulation

What do we tell clients? • Leave it alone• Get it tested for asbestos content if it is a concern to

the buyer• Most older homes have some hazardous materials• There is no evidence of health risk if it is not exposed

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Vermiculite Insulation

Vermiculite

“..there is currently no evidence of risk to your health if the insulation is…isolated in an attic…”

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Summary

• Keeping things in perspective helps everyone.• Presenting solutions makes the difference.

If it’s Run-of-the-Mill,

don’t Run for the Hills!

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Thank you!