Can You Sell a Home with Lead-Based Paint?
Even though the information on this web page is provided by a qualified industry expert, it should not be considered as legal, tax, financial or investment advice. Since every individual’s situation is unique, a qualified professional should be consulted before making financial decisions.
We are going to discuss the critical issue of selling a home that has lead-based paint so that you can confidently move forward with selling your home.
As a professional real estate investor with more than 20 years of experience, I can assure you that you can sell your house with lead paint. You can do it in two ways: the easy one and a harer one.
We’ll discuss both ways in detail, as well as the nature of the obstacles holding you back when you are trying to sell the house with lead paint.
How Can I Sell a House with Lead Paint?
2 Options for Selling a House with Lead Paint
There are basically two ways that you can sell a house that has lead-based paint. The first way is selling the home that needs major repairs as-is. This option will save you from having to do the work needed to deal with the problem.
The second way to sell is to fix the problem first, and then market the house the way you would any other house.
These options have very different strategies. One or the other of them might be more desirable depending on your situation. We’re going to go over the specifics of each option so that you can make the best decision for your circumstances.
Obstacles You May Encounter When You Sell a House with Lead Paint
In the forty-plus years since the US outlawed the production of lead-based paint, the public has been repeatedly made aware of the dangers of having lead in their home. By now, the average homebuyer will probably prefer to stay away from the problem altogether.
Most homebuyers are going to need to borrow a significant portion of their purchase price. Their lender may require that steps be taken to address lead-based paint that goes beyond government regulations.
Lenders will look at the property as if they were going to be the owner. If they should have to foreclose, that is exactly the position in which they will find themselves. They don’t want to be left with a lead paint problem that they have to fix.
How Dangerous Is Lead Paint?
Lead is a highly toxic substance that can do long term damage to our kidneys and our brains. Lead can be absorbed into our bones. Then, when we get older and our bones deteriorate, the lead is released into our bodies.
Lead is especially harmful to children. Tests show that they can be affected more strongly by lower doses of lead than adults. Lead can disrupt the development of their nervous system and brain causing long term health risks.
Lead paint in particular is a problem because as it deteriorates over time, or is disturbed, it can become dust that is absorbed into our bodies. If the paint peels, small children have been known to pick up pieces of paint chips and put them in their mouths.
Should You Disclose Lead Paint Issues when Selling Your Home?
Telling buyers about the presence of lead-based paint in a home is the only residential property disclosure that is required by federal law (other types of disclosure are regulated on the state level).
The US banned the use of lead in paint in 1978. The EPA requires that if you are selling a home built in 1978 or earlier, you have to provide the potential buyer with a lead-based paint disclosure.
The disclosure that they prepared discusses the consequences that lead can have on our health and the health of children. It also has the seller state whether or not they are aware of the presence of lead-based paint in the house.
Sellers also have to give the prospective buyer a pamphlet that has been approved by the EPA that educates the buyers about lead-based paint. It describes how to tell if you have lead-based paint in your home and what to do about it.
You will also have to give your buyer up to 10 days to conduct tests for lead-based paint and let them terminate the contract if it is found.
In addition, many states have disclosure regulations that go further. They may require that sellers of all homes, no matter when they were built, provide a lead-based paint disclosure to buyers.
Failure to comply with federal regulations regarding lead-based paint can result in possible criminal charges against the homeowner.
If you don’t disclose what you know about lead-based paint in your home, you could also face legal action from the buyer. This could include lawsuits for damages for any health problems that are believed to have been caused by lead-based paint.
Option 1: Sell Your Home with Lead-Based Paint As Is
As we mentioned earlier, selling your home with lead-based paint as-is would be the easiest option for you.
Below is a description of how you can sell your house as is, fast, and for cash.
Will Anyone Buy a House with Lead Paint?
Most homebuyers are looking for a “move-in ready” home. A small number of homebuyers would like to find a fixer-upper. They hope that they can fix any problems themselves and wind up with a good home for a low price.
A major challenge for these buyers is cash. If they can’t pay cash for the property, then they will have to borrow the money. Conventional, FHA, and VA mortgage loans aren’t designed for this type of purchase.
FHA and VA regulations state that if the house was built before 1978, and the appraiser notes deteriorating or peeling paint, then remedial measures have to be taken before the property will be approved.
The other challenge is the fact that these buyers are looking for a property that has minor defects, not health issues.
On the other hand, professional real estate investors buy homes with cash. They are well prepared to deal with issues such as lead-based paint.
Real estate professionals buy homes as investments. For them, it’s a business decision, not an emotional one. They see issues like lead-based paint from a financial viewpoint. What will it cost them to fix the problem?
Real estate investors buy properties based on the market and their intended use of the house. If they intend to fix it and sell it, known as house flipping, they look for a good resale market.
If they are a long-term investor who will own the house and rent it, they want a good rental market.
Investors can oversee the repair of the property and act as their own construction manager. A lot of the work can be done by them and their regular workmen. For more specialized areas, such as dealing with lead-based paint, they bring in certified inspectors and repair crews.
Professional real estate investors prefer to find homes that need work that they can perform for less cost than the general public. This is how they maximize their investment. In areas with older homes, they are used to dealing with lead-based paint.
To learn more in detail about all of the aspects to keep in mind when selling your home to a real estate investor, you can read our guide Selling Your Home to an Investor the Right Way. And here, let’s discuss the main pros and cons of going this route.
What Are the Benefits and Drawbacks of Selling a Home As Is to an Investor?
If you have a home to sell that has lead-based paint, selling to an investor has some strong benefits, such as:
- You sell the house without having any responsibility for fixing the problem. All the responsibility and expense of dealing with the lead-based paint is passed on to the buyer.
- Since investors pay cash for properties, the transaction isn’t controlled by a buyer’s lender. You don’t have to worry about whether or not the property and the borrower will be approved.
- When a lender is involved, along with appraisers and inspectors, the process can take from 6 to 8 weeks. Professional investors can often close a few weeks after their offer is accepted.
- If you deal directly with an investor, there are no commissions which are the biggest part of a seller’s closing costs when selling a house with a realtor. Any other costs can be included in the investor’s offer so that you don’t have to bring any funds to the closing table.
- When you deal with an investor, you don’t have to stage your house or market it. You and your family don’t have to go through the hassle of repeatedly having to leave your home for showings and open houses.
An investor’s offer will be based on the amount of work that needs to be done and their desired profit margin. Depending on the market and the condition of your home, their offer may be below market value.
However, you should compare investors’ offers side by side with the costs of fixing and selling your home. In some situations, the time itself that you are spending preparing your property for sale may cost you more than you will gain from increasing the property value.
Once you compare all pros and cons, it may be well worth the convenience to sell your home to an investor.
How to Get the Most Money When You Sell Your House for Cash As Is
To get the best price for your home from cash buyers, you need to compare multiple offers.
You’ll need to market your home to as many investors as you can find. If you spend time online, you can probably find a few investing companies who are active in your area.
Then you need to research them to make sure that you are dealing with investors who know what they are doing. You also want to make sure that they are well funded and have a good track record of closing deals.
HouseCashin has already done all of this work for you. The professionals at HouseCashin have researched the best real estate investors in each area of the US and created an easy way for you to reach them.
With our simple Request a Cash Offer Online form, you only have to make your request for offers one time. HouseCashin puts your request in front of the best investors in your local area.
Get multiple valid offers to consider at no obligation to you. Putting the pros at HouseCashin to work for you takes the stress out of selling your house with lead-based paint.
Option 2: Remove Lead Paint in Your Home Before Selling
So that you can make an accurate comparison, let’s take a look at the steps you will have to take to fix your lead-based paint problem and sell your home the traditional way.
An inspection for lead-based paint will need to be performed. This will indicate the level of remediation and removal that needs to be done.
Next, you’ll have to hire qualified workers to perform the work. This is not something that you can do for yourself, unless you are a professional contractor.
In some cases, significant removal work will mean that you have to make additional repairs to the affected areas.
Once your home has been cleared of lead-based paint, you can market it to the public. This will either be done with the help of a broker or by yourself in a For Sale By Owner (FSBO) sale.
Are You Obligated to Get Your Home Tested for Lead Paint?
Currently, you are not obligated to test your home for lead-based paint.
Federal law, sometimes called Title X, requires the sellers of all homes built before 1978 to:
- Disclose whether or not they are aware of any lead-based paint in the home
- Give buyers a brochure describing the dangers of lead-based paint and the possibility of its presence in homes built before 1978
- Give buyers 10 days to perform their own tests without obligating them to buy the home
Some states have their own lead-based paint disclosure regulations that are in addition to federal law.
As you’ve seen, if homes of that age show paint peeling or deterioration, a lender may want them to be tested. FHA and VA loans will require it for pre-1978 homes showing old and deteriorated paint.
Real estate brokers who work regularly in neighborhoods with older homes will protect themselves and their clients by strongly suggesting that they have testing done. Federal Title X gives them the right to do this, and to walk away if lead-based paint is found.
If you have reason to believe that you have lead-based paint and you intend to fix it, you will need to have an inspection done.
The EPA website has a list of certified lead-based paint inspectors who can do the testing on your home. Their report will show the extent of any lead-based paint in your home and the steps you will need to take to fix the problem.
Removing Lead Paint
A buyer will expect any lead-based paint to be removed, not painted over or covered up with added drywall or vinyl coverings. Removal of the paint or replacement of painted surfaces are the only permanent solutions to the problem.
In 2010, the EPA created the lead paint Renovation, Repair, and Painting Rule (EPA RRP). This ruling describes how work on homes that may have lead-based paint can, and cannot be done.
When removing lead-based paint you have to be careful not to create dust or small debris that can remain in the home. Acceptable methods often use liquids to avoid creating dust.
Your contractor can remove the paint by wet sanding, but the equipment must have a HEPA air vacuum attachment to capture any dust or small particles. The paint can be softened with a low-level heat gun or with paint removers and then scraped off by hand.
If it is determined that removal efforts will not fix the problem, you may have to replace the painted materials and areas altogether. This will mean taking down and replacing drywall, doors, windows, or other surfaces that were painted with lead-based paint. Workers have to take extra safety precautions to protect themselves and others from the disturbed paint debris.
The EPA has strict conditions for the disposal of materials that contain lead. This will increase the contractor’s costs which they will pass on to you in their price.
Making Repairs After Getting Rid of Lead Paint
In addition to removal efforts, repair work on homes that had, or may have lead-based paint fall under the EPA RRP.
Any home that was built before December 31, 1977 and that has a child under the age of 6 living there has to comply with EPA RRP. Their definition of “living there” can include a child who visits regularly.
This applies to:
- Work that disturbs more than six square feet of interior painted space
- Work that disturbs more than twenty square feet of exterior painted space
- Window replacement
- Carpet replacement
- Demolition work
- HVAC repair or replacement
- Possibly work that involves sawing or drilling
The regulations include rules that limit the possible creation of dust and small debris, additional containment of the work area, and daily cleaning of the area.
After the job is finished, the contractor is required to go over the work and the dangers of lead-based paint with the occupants of the home.
Contractors who are hired to do repairs on a house that might have lead-based paint must be certified by the EPA.
Failure to comply with these regulations can result in fines of $37,500 per violation.
Overall Costs when Fixing Your Home with Lead Paint
Costs for dealing with lead-based paint vary widely in different parts of the US. You will want to contact EPA qualified contractors in your area and get several quotes for your work.
The level of work needed, removal vs replacement, is a major factor in your costs.
Depending on your location and the size of your home, a lead paint test cost could be from $150 to $500. There are do-it-yourself lead testing kits that cost less. You need to be aware, however, that no one involved on a buyer’s side of the transaction will be satisfied with that level of testing.
Lead paint removal costs are estimated by the EPA to be from $8 to $15 per square foot. This would result in a cost of from $9,600 to $30,000 for a 2,000 square foot house. That’s a huge difference that depends on the level of treatment required to remove all lead-based paint in the home.
The high end of that number relates to lead abatement costs. This would include at least some amount of demolition and disposal of materials and surfaces that were painted with lead-based paint.
The EPA estimates an average cost of $10,000. Other sources estimate a national average of around $12,000. Everyone agrees that you should expect to spend as much as $10,000 and the final tally could exceed $20,000.
The increased amount of labor involved in meeting EPA standards results in higher costs and more time to complete the project. You can probably expect the work to take twice as long as an ordinary remodeling project.
If you have plans to sell a house that has lead-based paint you should schedule 4 to 6 weeks for testing and removal work first. Your actual time can vary based on the amount of work to be done and the availability of EPA certified inspectors and contractors.
The marketing and sale of your home will take another 6 to 8 weeks. Your time may possibly take a little less if you are in a strong market or are selling in the busy springtime real estate season.
Which Option to Take when Selling a Home with Lead-Based Paint?
Once you’ve compared the options for selling your house with lead-based paint, you can make your decision on which is the best strategy for you.
If you have time and cash available to do the work to your home before selling, consider fixing your home first.
Talk to a real estate professional and find out what the market value of your home is after removing any lead-based paint. Also, have them give you an estimate of closing costs.
Then you should have your home inspected so that you know the extent of the work that needs to be done.
Talk to several certified contractors and get quotes for the needed work.
Subtract all your estimated costs from the market value that you expect to get for your home in a sale. This will help you determine if the time spent fixing your home is worth it.
If you don’t have both the time and the funds to make repairs before selling, then a real estate investor is a good option to have. It might even be cost-effective.
To maximize the value you get from the sale of your property to an investor, consider requesting a cash offer from HouseCashin. We are a national platform connecting homeowners looking to sell their house fast and for cash with real estate investors willing to help them.
Fill out our “Request a Cash Offer” form to get a few offers from competing real estate investors working in your area and vetted by our reputation standards. Then choose the best offer and quickly close on your home within a couple of weeks, skipping the inconveniences and upfront expenses of a traditional real estate sale.