Contact CMHC directly on a rotting Power of Sale house after declined offer?
Hey everyone, looking for some advice on a frustrating situation I’ve been dealing with. I have been looking at a foreclosure/Power of Sale property but it’s in need of repairs but CMHC will not budge on price.
TLDR at the end!
The details are as follows, there is a vacant house listed for around 150,000$ that I really want to buy, it checks every box I want, nice size land, good location and a new foundation and siding on the house, confirmed the well works. The house needs severe work done though and the listing description is a complete joke! It says it's a "great opportunity needing light cleanup and decorative touches."
After I bickered back and forth for 2 months we settled on 135,000$ as an accepted offer. That gave me the go ahead to get some quotes for the repairs. The listing agent is in a different province and has never even stepped foot in the place and there are no inside pictures on the listing. This place has had several people already back out and has been vacant for 15+ months.
My inspection revealed severe possible sub floor rot from a leak at the patio door, green algae on the basement walls, and serious electrical hazards old Stab-Lok panel with water dripping from the basement ceiling around electrical outlets among other things. After I found this out I amended my purchase price to account for the renovations but they refused my offer and have signed my release and no longer bound to the house.
I want the house, but it’s realistically worth closer to 100k given the massive repair budget it needs. CMHC took 15 months just to drop the price by 9k. I don't have years to sit around waiting for the house to drop and drop again. I’m not afraid of the work and honestly want a fixer upper to make the way I want it.
My realitor as nice of a guy but I fear he’s not conveying how much in disrepair this place is to the listing agent and is not fighting for me. The listing agent feels it doesn’t need more then 10,000$ in work and finds it hard to believe it needs what I say it does.
I am highly tempted to take matters into my own hands and try to force a price drop. I’ve been thinking of 2 options.
Emailing CMHC directly: Bypassing both agents to lay out the exact structural and fire hazards, possibly sending the photos, and pointing out that their listing agent is wildly misrepresenting a dangerous fire trap. My hope is they panic about the liability and slash the price or offer it to me as most people will not want to buy the place after they get an inspection.
The more drastic approach would be Calling City Code Enforcement and reporting the structural and electrical safety hazards anonymously to force the city to slap a violation notice on the house and hope they drop the price to rid themselves of the headache.
I know real estate protocol says buyers shouldn't contact a seller directly. If I send this email, CMHC will probably just forward it right back to the listing agent and then get in touch with my realitor and cause drama and make it difficult if not impossible to buy a place from CMHC in the future.
If I call code enforcement, I'm worried CMHC won't lower the price at all. Instead, they might just remove the listing and fix the code violations, and re list the property then it actually would be worth the current listing price.
Has anyone ever successfully bypassed the agents to deal with a CMHC directly? Does sending an email or calling code enforcement ever actually work to get a discount, or am I just inviting a mountain of drama and locking myself out of the house forever?
Appreciate any insight or advice!
TLDR:
Walked away from a vacant CMHC Power of Sale house after my inspection revealed massive hidden defects (rot, mold, leaking, bad electrical panel), but the listing description still calls it a "light cleanup." CMHC takes forever to drop prices, and the out-of-province listing agent refuses to believe the extent of the damage.
I still want the house for a fair price (100k vs 150k asking). Should I bypass the agents and email CMHC directly possibly with the photos, or report it to city code enforcement to force a price drop or will this just cause a ton of drama and lock me out completely?