I'm not a home inspector and I'm not an electrician. I've been around enough inpsections at this point and bought and sold enough homes in areas like Leaside and yonge and lawrence to know a thing or two.
Here's the deal. Knob and tube is considered by insurers to be a riskier form of wiring. It's not grounded and in the insurers world, safer wiring has come to replace this older wiring. Many homes still have knob and tube wiring and it powers the house just fine.
But...over the last few years and certainly over the last few months, it appears there's been a movement of fewer and fewer insurers looking to underwrite homes with knob and tube wiring.
When you inspect the house you purchase, the home inspector is able to give you some sense as to whether or not the house has any active knob and tube wiring. That's pretty much the extent of what an inspector can provide. Unless the inspector opened the walls and had complete access to the attic, etc., they really have to go on an educated guess based on location of house; age of house and any reno's done where wiring may have been updated.
Now, when you go to get insurance on your house, the insurer will ask if there is knob and tube. When you reply --yes..you will learn the position that particular insurer takes. They may tell you they have no interest in insuring you and to look elsewhere; tell you they will insure and provide you with a binding letter to remove all within 60 days of ownership or at least reduce to say under 25% or 10%.
A client of mine learned this week that TD Insurance who for years was insuring knob and tube homes, has walked away from this business (unless you hear differently).
Some insurers will provide you with a binding letter and then mandate that you have a certified electrician come to the house and infact verify the exact percentage of knob and tube and then slate that into a sliding scale of premiums.
The best you can do is call around insurers and learn their positions before you buy.
There are some niche players who underwrite these homes, few questions asked.
At the end of the day, the arguement is...if you're buying a house to reno, you're going to be updating the wiring to run you're high efficiency appliances so the current state of the wiring doesnt mean much.
Also, paying a premium to insure is an annuity. It often pays to get rid of the knob and tube as a one time fee and update.
These decisions of course find their way into the calculator along with your other costs depending on the exact house you buy.
Do not be afraid of knob and tube and do not pass up a great house because it has it. By the way, most homes with knob and tube are also of the vintage to have water boilers in the basement to heat the house. Guess what....these boilers are often insulated with a thing called "asbestos".
Want other things to worry about....
buried oil tanks
lead pipes
tree stumps blocking old clay pipes carrying out sewage
I'm just joking around. The point is...know the age of the house you're buying. Know what to look for. Alot money for work that may need to be done and if you're lucky enough to find a great character house in one of the best locations in this great city-enjoy it!!
Cheers-
http://www.TheSmithsBuyAHouse.com
mgruenstein.blogspot.com
mgruenstein@trebnet.com
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