Sell a House With Roof Damage

How a bad roof narrows the buyer pool

The roof is one of the few repairs that can stop a mortgage outright. HUD’s Single Family Housing Policy Handbook, which governs FHA loans, requires the roof to “have a remaining physical life of at least two years.” When the appraiser thinks it has less, the appraisal is made subject to an inspection by a professional roofer, and the lender can require repairs before closing.

That rule matters most for modestly priced houses, where buyers using FHA loans are common. A roof with active leaks, sagging decking or missing shingles can leave you with:

• buyers who can’t get their loan approved without a repair
• inspection reports that turn into a repair demand or a price cut
• cash buyers only, at a price that reflects the repair

Conventional lenders and appraisers also flag visible roof damage, and every buyer’s inspector looks up from the driveway first. The FHA appraisal repair requirements guide covers the other items an FHA appraiser checks.

What the roof does to the rest of the house

A roof leak is rarely just a roof problem. Water that gets past the shingles soaks the decking, the attic insulation and the ceiling drywall, and it can run down inside walls. Ohio’s disclosure form asks about moisture damage from ice damming as well as roof leaks, a reminder that Northeast Ohio winters cause their own kind of leak where snow melts and refreezes at the eaves.

EPA advises drying water-damaged areas and items within 24 to 48 hours to prevent mold. A slow leak over a winter doesn’t get that chance, so attic mold and stained ceilings often come with a bad roof. If mold is part of the picture, see selling a house with mold.

Before you get any estimate, look in the attic on a rainy day, if it’s safe, and note where water shows. That tells a roofer, an insurer or a buyer far more than a photo of the shingles.

Disclosure: what Ohio’s form asks about the roof

Question C on the Ohio Residential Property Disclosure Form asks whether you know of “any previous or current leaks or other material problems with the roof or rain gutters,” and asks you to describe repairs made in the past five years. A new roof is worth listing there too, with the year and any warranty, because it answers a buyer’s question before it’s asked.

Not every seller completes the form. Estate fiduciaries, heirs who never lived in the house, and sellers in court-ordered transfers are among those exempt under R.C. 5302.30. Everyone else fills it out from actual knowledge and amends it if something changes before closing.

Storm damage and insurance claims

When a storm caused the damage, settle what you can with your insurer before you sell. A homeowners policy pays the policyholder, not the next owner, so a claim filed after closing can be messy or impossible. A few points to keep straight:

1. Report the loss on time. Policies set their own deadlines, so check yours.
2. Decide who keeps the money. If you sell before the repair is done, the purchase agreement should say whether the claim, the check, or neither goes with the house.
3. Lienholders may be on the check. Mortgage companies are often named payees on property claims, and the check may have to go through them.

Our guide to filing an insurance claim and then selling the house walks through that process for larger losses.

Getting estimates you can compare

Get at least two written roofing estimates that list the same scope: tear-off or overlay, decking replacement, flashing, ventilation and gutters. Ask whether interior repairs are included, because they usually aren’t. Two comparable bids give you a firm number to weigh against any buyer’s price reduction.

Replace the roof, credit it, or sell as-is

You have the usual three paths, and the right one depends on the rest of the house:

If the house is in good shape and the roof is the main issue, listing after a replacement may well net more. When the roof is one item on a longer list, see selling a house that needs work, or get a written offer that already accounts for it.