The Costs of the Codes

Planning to put a home on the market?

Better check your bathrooms--hidden selling costs could be lurking there in the form of high-volume toilets that must be replaced with ultra low-flow models.

In Los Angeles and the San Fernando Valley, Santa Monica and San Diego, if you don’t have water-saving toilets and shower heads when escrow closes, you’ve got a problem.

Home sellers in California can expect to be hit with the costs of a termite report and a host of small repairs discovered in the Realtor-recommended professional home inspection; although the potential buyer may pay for such repairs.

But in some cities--most notably Los Angeles--local ordinances tied to property resale can send sellers scrambling to retrofit homes with impact safety glazing to keep sliding glass doors from shattering as well as toilets that use only 1.6 gallons of water per flush.

“When it comes time to do all those things the city code says you have to do, you have to spend a lot of money,” said Mansoor Bokhari, who just sold a townhouse in Winnetka, installing required new toilets and an emergency gas shutoff valve in the process. He says he spent $250 on the gas valve alone. And he may have to foot the bill for another one, on the home he’s buying.

One retrofitting specialist said the average cost of bringing a three-bedroom, two-bath home up to par in Los Angeles is $600 to $700. That’s in addition to cosmetic repairs and the health and safety code upgrades that a home inspection might turn up.

“The cost of retrofitting can be hundreds and hundreds of dollars,” said Dan Drantch, a broker associate with Coldwell Banker Encino. He estimates that about half the sellers he deals with are surprised to learn about some of L.A.’s latest retrofitting rules.

Many of the requirements have been in place for years--it was in 1980, for instance, that Los Angeles lawmakers first required homes and apartments to have smoke detectors as a condition of sale.

But the water conservation ordinance is just 2 years old. And people who haven’t been in the real estate market recently are caught unaware.

It causes problems, Realtors say, because sellers typically want to buy the least expensive replacement toilets if they have to upgrade, while buyers expect the new commodes to be at least equal to the old, high-volume models that must be discarded.

“When you get into luxury homes, buyers see a $600 designer toilet that’s color-coordinated with the bathroom tile. But when the seller is told he has to change the toilet, he’s going to go for the least expensive, white, $60 toilet you can buy at Home Depot. It’s always a stumbling block,” said Pat “Ziggy” Zicarelli, past president of Southland Regional Assn. of Realtors and owner-broker of Style Realty in Tarzana.

While toilets tend to top the list, other hidden costs can be racked up because of laws that require:

* Water heater earthquake straps. Required by state law, it is one of the most common retrofits and costs about $85, according to Fabian Friedman, president of Metro Retrofitting Inc., based in Woodland Hills. His company does about 500 retrofits a month in Los Angeles and the San Fernando Valley.

* Smoke detectors. In Los Angeles, single-family homes can have battery-operated detectors installed in bedrooms and bedroom corridors, while multifamily construction with a common wall must have hard-wired units. In Beverly Hills, hard-wired smoke detectors with battery backup are required in all dwelling units, Friedman said. Battery units are $20 installed; hard-wired units range from $45 to $99 installed.

* Impact hazard glazing. Tempered glass is called for in the sliding part of sliding glass doors and manufacturers have been required to use it since 1970, according to Friedman. But if there’s no tempered glass emblem, a whole new door isn’t required--clear Mylar film can be applied to prevent the glass from shattering. The retrofit costs about $65, Friedman said.

* Earthquake gas shutoff valves. In Los Angeles, the buyer normally is responsible for installing the valve within 12 months of the close of escrow. The exception: If the seller bought the house after the law took effect in February 1998, and has not yet performed the work, the responsibility for the valve remains the seller’s, Friedman said.

Some laws, like those addressing the gas shutoff valve and water-saving shower heads, apply to commercial property in Los Angeles as well. Sellers are required to file a form with the Department of Building and Safety stating under penalty of perjury that all the requirements have been met. In addition, a certificate of compliance--signed by the owner, the buyer and a qualified inspector--is required. Without it, escrow won’t close, said Bob Steinbach, L.A.’s chief residential inspector.

Realtors and retrofitters in effect “police” the ordinances, Friedman said. His company won’t sign a certificate unless the property has been personally inspected and found to be in compliance.

Ideally, Friedman said, sellers learn about retrofitting from their Realtor so they aren’t surprised in the middle of escrow.

“I always talk about retrofitting when I walk the house,” Drantch said. “You look at the toilets, the shower heads, the smoke detectors. You talk about the certificate of compliance.” But some agents don’t bring it up right away because they don’t want to scare off clients, he acknowledged.

Drantch offers his clients information on retrofitting companies such as Friedman’s, which do an inspection, write a report and complete needed improvements. The seller can pay a fee for the inspection, do the work himself and have the company reinspect it or let the company do the work (the inspection fee goes toward the work) and pay the costs through escrow.

There is some financial relief--cities and water agencies often offer free ultra low-flow toilets or rebates to homeowners who buy their own.

Santa Monica, which has had a retrofit program since the early ‘90s, offers free toilets for a $35 installation charge or provides a $75 per toilet rebate if the homeowner wants to buy something more upscale than provided by the city.

Santa Monica also mandates that shower heads and faucets emit no more than 2.5 gallons per minute and will provide a retrofitting homeowner with free low-flow shower heads and faucet aerators upon request, said Kim O’Cain, resource efficiency inspector.

Los Angeles requires low-flow showers but not faucets.

Retrofitting homeowners can take advantage of the L.A. Department of Water and Power’s offer to give customers either free toilets or rebates of $100 per toilet for single-family residences. Since the law went into effect in 1999, DWP records show that more than 84,500 toilets have been replaced with ultra low-flow models, said Tom Gacksetter, water conservation manager.

“An ultra low-flow toilet saves 21.6 gallons of water per day, so you can see we are achieving some significant water saving,” he said.

San Diego has a similar retrofit program, with city water department vouchers of $75 to $95 available toward new toilet purchases. The seller is responsible for compliance, preferably before escrow opens, but at least by 90 days after escrow closes, said Marlena Ackee, ordinance administrator.

And while 1.6 gallon-per-flush toilets are preferred, older low-flow models that use 3.5 gallons per flush are acceptable and don’t have to be replaced if already installed, she said.

Toilet retrofitting isn’t mandatory in Orange County, but there’s a voluntary incentive program with free toilets and “upgrades” (elongated bowls, colored porcelain) available for $35 to $65 as well as toilet purchase rebates of $50 to $80, said Joe Berg, water use efficiency manager for Municipal Water District of Orange County.

In Los Angeles, it’s possible to recoup 30% to 40% of retrofitting costs through the rebates, said Friedman.

And there are a few exemptions. Waivers are available if the property has been declared a historical monument or is within a historic preservation overlay zone, Gacksetter said.

Bathrooms of “architectural significance,” such as those in a Frank Lloyd Wright house or a classic California bungalow, are exempt, he said.

Exemptions are also granted for “incompatible plumbing,” such as a toilet that can’t be removed without destroying the alcove surrounding it.

But the most common complaint he hears--that new toilets don’t fit the footprint of the old toilets and require re-tiling, or worse, re-laying stone floors--isn’t enough to warrant a waiver, Gacksetter said. Neither is the argument that the old toilet color matches the sink.

There are no exemptions for property purchased as tear-downs, either. “Yes, you still have to put the low-flow toilet in. The law’s the law,” said Drantch, adding that in many “as is” sales, the seller insists that the buyer pay for it.

To avoid last-minute surprises about local ordinances tied to property resale, your best bet is to call the city you live in and ask, said Rolf Miller, owner of RPM Home Inspection Service based in Orange.

And when it comes to hidden costs of selling, retrofitting isn’t the only the only one, Realtors say.

“Many sellers are just as surprised by the city transfer tax. That, along with the IRS document transfer tax, comes to $4.60 per thousand. Think about a house selling for $600,000--that’s over $2,700 the seller has to pay. That’s going to throw the average seller off,” Zicarelli said.

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Lynn O’Dell is an Orange County freelance writer.