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One that Almost Got Away
By Russel Kirk
In looking at the cracks at the rear, I decided to take off one of the vent screens to see what I could see. We typically don't remove vent screens since we usually have access via a crawl space opening.
Well, low and behold. A manufactured home! The cracks at rear were where the skirt sections met. They were metal but had been stuccoed to match the rest of the house.
The buyer and buyer's agent were aghast, not to mention pretty angry. The reason? The house was selling for $475,000, definitely the price for a 1500 SF house in that neighborhood (San Diego, Calif.). The most expensive manufactured home in San Diego County that I could find, however, was $175,000 and that was for a 2300 SF, 2004 double-wide, double-long, double-tall, double this, double that model! That’s a $300,000 difference. Whoa! Of course, now that I had opened the can of worms, the home would never appraise for $475,000.
The interesting thing is that the current owners paid $235,000 in November 2000, and the owners before them paid $165,000 in June 1994, all normal prices for 1500 SF houses in this neighborhood at those time periods.
Conclusion? No one ever had the home inspected before and had no idea that it was a manufactured home.
The current owners are within their five and half year discovery period, so I see a lengthy lawsuit, which may lead nowhere depending on where the 1994-2000 owners currently reside and what they claim they did and did not know.
The $300,000 in potential damages is a significant amount of money, and even if I were found to be one-eighth liable (seller, seller's agent, former seller, former seller's agent, home inspector, title company, throw someone else in for good measure), that would have been $37,500 minimum, with court costs not included. And if the former seller has moved to a different state and the former seller's agent dead or can’t be found, I could be one-sixth liable - $50,000 or more. And it could get worse, much worse. That’s why I carry E&O insurance.
I'll be doing another inspection for them quite soon.
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