I own a small second home (market value about $40,000) that I'm
looking to sell It was built where knob and tube was apparently used as
well as ungrounded cloth shielded cable snip .



FWIW ... At $40K, is perhaps most of the value in the land? If so, then
I'd be wary of the buyer that's just looking for a way to get the price
down ( a buyer might be buying to demolish and rebuild ... that's what
going on around here). But first, if you haven't already done so, you
really need to get an appraisal done to establish the value as is. And
if it was me I'd avoid all that electrical and whatever else, and sell
as is ... with my lawyer taking over once I had a written offer that I
liked in my hand.

FWIW: Last year I had the old side of the house rewired (was knob and
tube) in order to get insurance renewed. Two story 1911 home ... cost
was $6000 cdn and the 100A breaker panel was previously installed ...
$500. I am just now finishing up patching and painting ... walls and
ceilings are full of circular 4" holes to run the new wiring. So
there's more to the rewiring than just the wiring. Or ... if you go
ahead with the wiring and aren't prepared to do the patching and
painting, then cost that in too.

So from my experience, I'd sell as is. Now if it was $650,000 property,
that might make a difference :-)