Well, we've found just the right house (or close to it ... sometimes
compromises have to be made), and are ready to make the offer. It
shouldn't be a scary thought because we will have done our homework.
The first thing we do is to check the comparable home sales in that
subdivision to see if this home is priced fairly, and how it relates to
others similar to it that have sold. This CMA (comparable market
analysis) tells us the price range of sold properties are in the area,
what the average time on the market for them has been, and what the
average sales price per square foot of the recent solds are.
In some cases there will not be enough that have sold. I find out how
long the property has been on the market or if there have been any price
reductions during the listing period, if there have been any other
offers on the property, and what the motivation of the seller is.
One thing that buyers quickly find is that they themselves become
mini-appraisers. After a day out, buyers know instinctively if a house
is overpriced. Fortunately, since our areas are subdivisions and
masterplanned communities, there are similarities to them. There is no
point in overpricing since it won't appraise! Therefore, there is a
smaller margin of pricing over what an actual market price would bring.
When we're comfortable with what we will be offering, we begin to
fill in the blanks of the Arizona Residential Real Estate Purchase
Contract. This contract took 2 years in the making (its revision) since
new issues, such as lead-based paint, pool safety, for example, make
changes necessary from time to time. It has the input of attorneys,
appraisers, loan companies, inspection companies, termite companies, and
the Real Estate Board of Realtors, making it as fair as possible for
both buyer and seller.
We go over this contract very carefully, so that each paragraph is
understood. The first part acknowledges agency, and that I exclusively
represent you as a buyer. Next is the earnest money, which is held by
the title company until closing and becomes part of the down payment.
The property description follows, and an extensive paragraph
outlining what stays with the house. The majority of homes in the Valley
are sold without the refrigerator, washer or dryer, but any other
appliance that is attached stays, such as the stove, dishwasher and if
built-in, the microwave. Window coverings, fountains, pool equipment,
lighting, screens, etc. are also examples of what stays.
Next are the terms of the offering price, including which method of
financing. Then we fill in the closing date desired, and acknowledge
that the closing date is actually the recordation date at which time
keys are passed to the buyer.
The title company chosen is stated, and what their role is, and lists
the title insurance policy commitment, including the Conditions,
Covenants and Restrictions (CC&Rs), and that they will make the
prorations and what the title company provides.
Next addresses the disclosures. You will be pleased to know that
Arizona has many provisions for disclosures! An important one is from
the Seller, known as SPDS, Sellers Disclosure Statement, a 3-page
disclosure provided to the buyer within 5 calendar days for approval. If
the home was built before 1978, a lead-based paint disclosure is
necessary. If the home has a pool, a pool-safety disclosure is
necessary.
There are provisions for a Home Inspection, Home Warranty and any
other inspections the buyer may elect. The Home Inspection company I
recommend is a part of ASHI and certified, and very thorough!
If the home is on well, or septic, there are certain seller
obligations. However, the highest percentage of homes is city sewer and
city water.
The day before closing, there is a final walkthough to make sure all
is as it was when inspected, or if any repairs that were requested have
been completed.
There are warranties that survive the closing. Any information that
was withheld which materially and adversely affect the sale will survive
the closing. Fortunately, this has never been the case in the 25 years I
have been in real estate in Arizona!
Remedies for Breach are addressed, whether by buyer or seller, what
recourse, there is such as mediation, arbitration or if judicial action
is warranted.
There are additional terms, such as compensation of the Brokers (it
is paid by the seller and the amount is agreed upon in the listing
agreement).
This is a synopsis of the terms of the contract. The legalese
contained brings this contract to 9 pages! Fortunately, it is plain
language and easily understood.
Okay, now what? As buyer's agent, I present the contract to the
seller's agent, who in turn presents it to the seller. If feasible I
will be negotiating with the seller and their agent at their residence.
However, if the seller is out-of-area, negotiation is done from me to
the seller's agent, or in a conference call. May I say, that as a top
producer, I have a successful career based on negotiating skills? I will
definitely be working on the buyer's behalf! You can count on it.
There may be multiple offers, there may be counter offers. Time is of
the essence as the contract states. A fair offer usually generates a
fair response. With 25 years of experience as part of the Top 10% of
Coldwell Banker, there will be no stone left unturned to get you the
best possible outcome.
Now, we have an accepted offer. What's next? We have 10 days in
which to do a Home Inspection. We both attend because you will learn
much about the mechanisms of the home. Should you be out-of-area, I will
attend. You will have a spiral-bound book listing every detail of the
home, including the roof. Any repairs will be requested in writing
immediately, and the seller has 5 days in which to respond.
After inspections are completed and approved, we enter our next
phase, the closing!
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