Tuesday, September 2, 2014

Avoiding Legal Issues In Real Estate

As a Realtor for over a dozen years, I've never been sued, or even had a breath of a suit. For that I am grateful. Well, for that I say thank you to myself for serving my clients well, more than well actually.

Read an article this morning that a big sale (to the tune of over 12M) that happened in Malibu a few years ago was going through some legal issues due to the size of the property being about 1/3 less than the advertised square footage. Apparently there is an ordinance in that community that allows for the basement and garage to be counted in the actual size. Even if the tax records show it as less though.

The listing agent and the selling agent worked for the same company. Buyer isn't going after his agent, only the sellers agent. I find that interesting, of course!

However, when you are buying real estate.....and you are using me as your agent.....you should (and do) get every little bit of info about the property you can possibly find to make sure it really is the right property for you.

Whether it is a buyer or a seller, they are presented at the initial thought process of buying or selling:

1) Comparable Sales 
2) Property Profile/Tax Record
3) A bevy of additional documents too, of course. But for this blog, note the item directly above # 2.

The property profile is a brief, yet very important document to see if likelihood of the property being advertised at 15k sq feet is only 9500 sq feet. Sometimes they are more than noted, but if so, we need a written reason (aka seller disclosure) as to why it is not noted in the tax records attached to the MLS.

Buyers recently closed on a property that my tax records showed less than. We were able to obtain permits, which my clients signed. And, a letter from the assessors office noting the correct square footage that was advertised, which was signed as well.

Other little tid-bits are on that property profile report, tax basis, special assessments, last time it was sold, all kinds of good info. My clients appreciate it being shown to them. I would if I was buying or selling as well!

This particular buyer didn't have an appraisal, who would have caught the difference in size, as he paid all cash. Honestly at 12.5 M, I'd want an appraisal for sure, cash buyer or not.

At any rate, buyer and seller beware. Make sure you and your agent are looking for EVERYTHING, related to the property. Do not count on someone telling you the truth. Do your due diligence, no matter what. And, if I have a client that does not want to? Hmmmm, you can bet they are signing waivers indicating that they were recommended to do XYZ....and chose not to.

No comments: