A major concern when viewing an older home is wiring; here are some useful tips to assist with identifying substandard wiring and how to deal with the situation.
Perils in Real Estate: Wiring
More and more frequently insurance companies are refusing to insure homes with knob and tube, and aluminum wiring. With many financial institutions making financing conditional on the ability to obtain insurance, this has dire implications for real estate. Potential buyers and seller's ability to close a real estate transaction is compromised in situations where there is substandard wiring.
Knob and tube wiring was commonly used in residential construction during the early part of the century. It derived its name from the ceramic knobs, which secured the wire, and the ceramic tubes that were passed through the wood framing. The primary concern here is that the insulation that surrounds the wiring will break down creating a potential hazard.
Aluminum wiring was used during the 1960's through the 1970's, and it has now been discovered to be a potential fire hazard. This is commonly because of arcing at the connectors; which causes overheating at the connections between the wire and devices, such as switches and outlets or splices in the wire.
A simple method of identifying aluminum wiring is to examine the wire sheathing for the word aluminum. If you can't find the word aluminum embossed in the wire sheathing then look for silver colored wire instead of the copper colored wire used in modern wiring.
Removal and replacement of both knob and tube wiring and aluminum wiring can be quite costly depending on how much of the substandard wiring there is in the home. If you believe a home you are viewing has substandard wiring, it's important to have it looked at by a professional. An electrician will be able to estimate the cost of removal and replacement.
This situation can be easily be averted by having the offer conditional on a home inspection. Making the offer conditional on the inspection allows for substantial repairs to be rectified by the homeowner prior to closing or to have a deal terminated based on the inspection. A licensed home inspector or a good general contractor can usually point out and identify potential real estate pitfalls such as substandard wiring. It is a great investment with any home purchase to have the property inspected for problems that may otherwise creep up on you.
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