Selling an older house on Long Island

What the buyer's inspector will actually look at

New York licenses home inspectors, and the state defines a home inspection as the process by which an inspector observes and provides a written report of the systems and components of a residential building. In practice that means the heating, cooling, plumbing and electrical systems, the foundation, the roof, the masonry structure and the exterior and interior components.

An inspector reports what is there on the day. They do not predict how long a roof has left or guarantee a boiler through the winter. That distinction matters to a seller, because the report that comes back is a list of observations, and the negotiation that follows is about which of them are worth money.

The items that stop deals here are rarely cosmetic. They are the ones with a rule or a lender behind them: a structure with no certificate of occupancy, a tank in the ground, a cesspool, or an electrical service nobody will insure.

Source: New York Department of State, home inspector licensing

The certificate of occupancy, and the work nobody pulled a permit for

A certificate of occupancy is issued by your town, not by the county or the state, and it covers the structure as it was approved. A dormer, a deck, a finished basement or a garage conversion done without a permit is not on it. That is the single most common open item on an older house here.

It is not automatically a disaster. Towns have a route for it. The Town of Brookhaven, which covers Holtsville, Lake Grove and part of Ronkonkoma, issues a Certificate of Existing Use for structures that predate the record, and the Building Division will tell you which of the two you need before you list. Islip and Smithtown run their own versions.

Two reasons to start this early rather than at contract. The work takes as long as the town takes, which is not something your closing date can compress. And a valid certificate of occupancy is one of the eligibility conditions for the Suffolk County septic grant in the next section but one, so an open permit can quietly cost you twenty thousand dollars of somebody else's money.

Sources: Town of Brookhaven Building Division, Suffolk County septic grant eligibility

The oil tank in the yard

Most residential heating oil tanks under 1,100 gallons sit outside New York State's petroleum bulk storage rules. Suffolk is not most places: the state's own guidance tells homeowners in Nassau, Suffolk and Westchester to contact their county health department, because these delegated counties have regulations that do apply.

Your options are removal, testing, or abandonment in place. The state puts removal of a residential tank at roughly $1,000 to $5,000 depending on size and access, and says a tank abandoned in place has to be emptied, cleaned and purged of all vapours. Testing tells you about today: in the state's words, no test can predict what will happen next year, next month, or even the next day.

The line that matters to a seller is this one, from the same guidance: a bank or the buyer likely will ask for an environmental assessment or the removal of the tank. Deciding that yourself, before you list, is cheaper than deciding it in attorney review with a contract at risk.

If there is contamination, it has to be reported to the state Spills Hotline on 1-800-457-7362. Many homeowner policies exclude pollution, so the cost can land on the owner. That is a reason to find out early, not a reason to leave it alone.

Sources: NYSDEC, Underground Heating Oil Tanks: A Homeowner's Guide, Article 12, Suffolk County Sanitary Code

Cesspools, sewers, and the money the county will put in

A cesspool is not a reason a house cannot be sold, and plenty of houses here still have one. It is a reason a buyer asks questions, and it is the item most likely to come with a grant attached.

Suffolk County's Septic Improvement Program provides installation grants up to $20,000 per property depending on whether the project qualifies. The New York State Septic System Replacement Program provides grants or reimbursements of up to 75 per cent of eligible costs, not to exceed $25,000 per property. The two run through the same county application.

The conditions are worth reading before you assume you do not qualify. The property has to be an existing residential home, currently on a cesspool or septic system, not connected to municipal sewers, with taxes current and no liens, and with a valid certificate of occupancy.

Whether it is worth replacing before you sell or pricing for and leaving is a real question with no general answer. It depends on what the system is doing now, what comparable houses nearby have, and how long you can wait for a grant to come through. That is a conversation, not a rule.

Source: Suffolk County Septic Improvement Program

Roof, boiler and electrical service: fix it or price it

These three are where sellers spend money they did not need to spend, and save money they should have spent. There is no rule to follow here, so the honest framing is a question: does the item stop a buyer getting a mortgage or insurance, or does it just show up on the report?

Things that stop a deal get fixed or get priced with a number attached, because a buyer who cannot insure the house cannot buy it. Things that only show up on the report are usually cheaper to disclose and discount than to replace, because you will not get the cost of a new roof back in the price. A buyer values a new roof at less than you paid for it, every time.

What you should not do is find out about any of it from the buyer's inspector. Raise it yourself and you are describing a known condition. Wait, and you are answering for something you look like you were hiding.

Asbestos siding, knob and tube, and other things that are not emergencies

Asbestos cement siding on a 1950s house is common and is not, by itself, a hazard while it is intact and left alone. It becomes a regulated job when somebody disturbs it. New York's asbestos rule exempts owner-occupied single-family dwellings where the owner performs the work themselves. Hire a contractor and the exemption does not apply: the work has to be done by a licensed asbestos contractor under Industrial Code Rule 56.

Knob and tube wiring is the other one that sounds worse than it usually is. It is original wiring with no ground, it will be written up, and what happens next depends on the buyer's insurer rather than on any state rule. Insurers differ, so the useful step is finding out what yours says before a buyer finds out what theirs says.

Neither of these needs solving in a panic. Both need knowing about before you are three weeks from a closing.

Sources: NYS Department of Labor, asbestos abatement homeowner exemption, Industrial Code Rule 56

What you can reasonably leave undone, and how to say so

You are allowed to sell a house with problems in it. What you are not allowed to do is hide them, and New York changed the arithmetic on that.

Every seller of residential real property has to deliver a property condition disclosure statement to the buyer or the buyer's agent before the buyer signs a binding contract of sale, and a copy signed by both has to be attached to the contract. The form now covers flood history and flood zone as well as the building.

The old way out is gone. A seller who skipped the form used to owe the buyer a $500 credit and that was the end of it, which is why so many treated it as optional. That subdivision was repealed. A seller is now liable for a willful failure to meet the requirements, and the measure is the actual damages the buyer suffers.

So the practical answer on an older house is usually the same: find out what is wrong before you list, fix what blocks a mortgage or an insurance policy, write down what you are leaving, and price it. A defect you disclosed is something the buyer decided to accept. One you did not is the subject of RPL 465 above.

Sources: RPL 462, delivery of the disclosure statement, RPL 465, liability