What is a punch list when it comes to new construction in NYC? Are sponsors obligated to finish a buyer’s punch list within a certain time frame?
We’ll explain everything you need to know about new development punch lists and show you two sample punchlists in this article.
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What Is a Punch List?
A punch list is a list of improvements, repairs and touch-ups that a new development condo or co-op buyer wants the sponsor to complete before closing or soon after closing.
Usually in new construction there are 2 walk-throughs of the apartment before closing. The first walkthrough is to develop a punch list and the final walk-through is to make sure everything on the punch list is done.
Are Sponsors Obligated to Complete the Punch List?
Sponsors are only legally required to build a new construction project up to code per the co op or condo offering plan (i.e. typically referenced in a section called Rights and Obligations of Sponsor — Construction Obligations).
However, sponsors are also business people who want their customers to be happy, and the larger developers have significant brand equity to protect. As a result, a punch list is referenced in most new development purchase contracts:
Sponsor shall make a good faith effort to address any punch list items within a reasonable period of time after closing.
Does the above language sound obligatory to you? Sponsors only need to make commercially reasonable efforts to complete the buyer’s punch list within a reasonable amount of time. In fact, buyers are often required to sign an official Inspection Statement at the walk-through.
This Inspection Statement will often contain the below language:
I understand that work indicated on the inspection sheet shall be performed in accordance with the practice of the industry. In the event of a dispute, Sponsor’s contractor, architect or engineer shall determine whether or not such work was performed according to such standard and his or her decision shall be binding on the parties hereto.
You agree to complete all items listed on this inspection statement within a reasonable period of time following closing to my Unit, subject to delays for work or materials beyond your control.
As a result, you truly are relying on good faith that the sponsor will complete any touch-ups you’ve requested when buying a new construction home in NYC!
Disagreements over Punch List Additions
New development condo or co op buyers should always ensure that the real estate listing agent or another sponsor’s representative is present at the walk through. You’ll want to agree on the punch list with the sponsor’s representative and have both of you sign or initial the punchlist.
Buyers should be as complete as possible as the listing agent may not allow you to add additional items to the punchlist down the road.
Furthermore, the items a buyer wishes to add to the punch list should be reasonable in order for the sponsor’s representative to agree. For example, a request for a new bathtub to be installed because you aren’t the biggest fan of the original design would probably be rejected.
However, if there is extra paint on the window frame that’s a result of poor workmanship will most likely be added to the punch list and fixed.
Here is an example of what a sponsor’s representative responded with after a buyer asked to add some additional things she thought off after the punch list had already been created:
Thanks for your notes. Unfortunately, this is not the way we do things. You are not able to add things to the list. I made some of the changes on the attached sheet. The kitchen was designed as it is now. Any changes that we are trying to make – is a try – hence the word ‘can’. There are indeed design flaws. We will do what we can.
Sample New Construction Punch List
Punch List for 550 New Build Avenue
Buyer: Lamont Greene
1st Walk-through Date: July 9th, 2018
2nd Walk-through Date: TBD
Smooth out and repaint the baseboards apartment wide
Missing door stops apartment wide
Install bathroom accessories – toilet paper holder, towel bar, rob hook
Ensure all magnetic door closures are operational
Clean around window frame from over painting
Repair divot in wall
Fix wall beside intercom
Smooth wall left of door entry
Fill in missing screws on transformer boxes
Retouch entry door
Adjust door lock on coat closet
Repair door near 2nd to top hinge
Fill in gap with black silicone at threshold at 2nd bathroom
Washer dryer closet – fill in gap at threshold
Washer dryer closet – fill in gap at top of tiled baseboard
Clean up over painting in corners (ceiling and floor)
Install shelves in medicine cabinet
Repaint back of entry door
Level off tub spout
Oven needs to be secured in
Fix alignment of upper cabinets so they are all level
Install filler pieces on both the left and right of upper cabinets
Repair lower and uppers where marked, both inside and outside
Adjust the dishwasher so it’s flush with the cabinets
Add a piece of baseboard molding to the lower cabinet left of the range so it integrates better on the wraparound
Fill in gaps in the shelving unit at the end of the island
Insert a piece of molding so it covers the gap at the island counter and side panel joint or recut the end piece and dishwasher filler piece. Perhaps have them at different plains when two pieces of different material meet.
Fix nicks in interior of upper cabinets covering hood
Repair cracked window facing east
Repair the closet door at the base
Repaint the walls above the thermostat
Missing outlet cover behind door
Clean paint off the locking mechanism on the door
Repaint the northern wall
Repaint the closet frame
Smooth out the baseboard to the left of the closet
Replace missing screw from lockset
Smooth the bulge in the floors at the southeastern corner of the room and fill the gap
Replace sprinkler heads
Fill in the gap with black silicone at the threshold of the 2nd bathroom
Repaint to the left of the entry door
Fill the gap on the door frame on the lower right
Repair the edge near the cover lighting in the shower
Redo silicone along all corner edges
Paint the interior of the cove in the shower
Install shelves in medicine cabinet
Adjust the vanity drawers so they are level
Level shower escutcheon plate
Redo joint at tile to sheetrock joint along wall and ceiling
Sponsor Representative Signature:
Simple Punch List Example
Large crack on top left corner of second bedroom
Shower door in master bath does not close – glass chipped off door when forced to close.
Outlets next to the kitchen faucet: the two outlets on the left don’t have power (there are 4 total there)
Outlet on on the SE corner of living room, plugs cannot be inserted in the top outlet (won’t go in all the way). NE corner of living room’s outlet, cannot insert plug in either top or bottom one.
Lights not working: kitchen light and 2nd BR closet (bulb or socket?).
Windows need cleaning.
Scuff marks in the hall around the entry way (small one near thermostat also, for instance).
Scuff marks in master BR closet.
Visible screws on shutters, some shutters don’t sit well in their window compartments.
Paint apartment white (where currently light pink or light yellow — living, bedrooms).
Disclosure: Hauseit and its affiliates do not provide tax, legal, financial or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, financial or accounting advice. You should consult your own tax, legal, financial and accounting advisors before engaging in any transaction. The services marketed on Hauseit.com are provided by licensed real estate brokers and other third party professional service providers. Hauseit LLC is not a licensed real estate broker nor a member of any multiple listing service (MLS).