Buying a home and getting a home inspection typically go hand in hand. But now, a new company is aiming to make sure you dig a little deeper to learn the true value of a property.
"When you're buying a home you are buying the trees and shrubs," says Neil Sexton, sales director for Horticultural Asset Management, Inc.
He's talking about the price of curb appeal and understanding exactly how to quantify it in dollars.
"When some people make an investment of 50, 100,000, 200,000 or 300,000 dollars worth of landscape assets over time or at one time five years ago, they should be able to, if they take care of them, benefit from highlighting the value of those when it comes time to sell," explains Sexton.
Horticultural Asset Management, Inc. just introduced in Raleigh, NC; Atlanta GA; and Washington, D.C. a service product that the company hopes will take root in the real estate industry. The service product is a replacement cost methodology for determining the value of a property's landscaping right down to the cost of a single tree or shrub. Clients can receive a certified HMI Horticultural Assessment complete with care instructions for their plants or a non-certified summary report that describes the replacement value of their trees and shrubs.
"It's always been subjective and visual but if you have a replacement cost value, whether you think it's ugly or I love it, this is what it's worth," says Sexton.
The company is working with real estate firms to introduce its service to buyers and sellers.
"If I inspect the roof, the plumbing, the electrical -- even if it's a $300,000 home -- there's a 150-foot oak tree in the front yard but no one looks at that. Now that thing could come down and destroy the whole home," cautions Sexton. He says buyers should know about these types of potential dangers.
On the other hand, Sexton says sellers who receive reports on their property can use them to assist with the negotiation process.
"Use it in the 11th hour in negotiations when you've exhausted all the other [things such as] the Italian tile, the crown molding, the window treatments. Now you say, 'Well, here's another thing. That's why we want $4,000 more.'"
Sexton says often sellers don't get the offer they want from buyers so every resource can help bring buyer and seller closer together. He says one agent in Raleigh was in the middle of negotiations when it looked as though they could not come to an agreement. Sellers wanted $680,000 and buyers were willing to pay only $600,000. The agent used the landscaping report to help the buyers understand the overall value of the property showing there was about $320,000 worth of trees and shrubs compared to practically nothing on another property the buyers were considering. According to Sexton, the home sold for $640,000. He doesn't say that it's all because of the horticulture report but, Sexton says it certainly provides value where before there was no clear cost associated with the landscape.
It's also being used as pre-loss inventory to show what the value of your land is. Just like when you video tape your home and all its assets, knowing the value of your trees, shrubs, and lawn is equally important.
"The arborist comes out and gives you a plant health score which includes strike zone trees, trees that are deemed fair, poor, or dead," says Sexton.
Ultimately, the end product gives the client a much better picture of whether the landscaping is a benefit or a hazard.