P R E S E N T S Minimize Your Risk Minimize Your Risk Maximize Your Earnings Maximize Your Earnings Understanding and Recognizing the Top 10 Property Conditions that most often lead to disputes in the Real Estate transaction *According to the NAR Legal Scan/Legal Pulse
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
P R E S E N T S
Minimize Your Risk Minimize Your Risk Maximize Your EarningsMaximize Your Earnings
Understanding and Recognizing the Top 10 Property Conditions
that most often lead to disputes in the Real Estate transaction
*According to the NAR Legal Scan/Legal Pulse
2016 NAR Profile of Buyers & Sellers
Characteristics of Home Buyers
First-time buyers made up 35 percent of all home buyers, an increase over last year’s near all-time low of 32 percent The typical buyer was 44 years old for the 3rd straight yearThe median household income rose to $88,500 an increase of $2,500 66% of recent buyers were married couples17% were single females 7% were single males 8% were unmarried couples
2016 Profile of Buyers & Sellers
83% bought single family homesThe typical home purchased was 1,900 square
feet, three bedrooms, two bathrooms, built in 1991
84% found heating and cooling costs were important environmental features
Buyers typically searched for 10 weeks and looked at a median of 10 homes
88% of buyers purchased their home through a real estate agent or broker
2016 Profile of Buyers & Sellers
Home Sellers and Their Selling Experience
The typical home seller was 54 years old, with a median household income of $100,700
For all sellers, the most commonly cited reason for selling their home was that it was too small (18 percent), followed by the desire to move closer to friends and family (15 percent), and a job relocation (14 percent)
Sellers typically lived in their home for 10 years before selling, an increase from nine years in last year’s report
Eighty-nine percent of home sellers worked with a real estate agent to sell their home The final sales price was a median 98 percent of the final listing
price Recently sold homes were on the market for a median of four
weeks
FACT:FACT:80% of claims against brokers E&O insurance
are due to property related conditions
What is theNAR Legal Scan and Legal Pulse?
Legal Scan Published every two years by National Association of Realtors
Legal Scan discontinued in 2013
Replaced with Legal Pulse
What is the NAR Legal Pulse?
Quarterly newsletter - analyzes current legal trends in risk management that impact real estate professionals (nationally)
Powder Post Beetles Frass Small circular/oval holes Meandering holes
through wood
Carpenter Bees Staining Bees hover around
eaves, deck, fence Round holes
Septic/Sewer#4
Sewer & Septic
Where does the water go?
Where does this water go?
Warning Signs of Septic/Sewer Issues
Slow sink drainsSlow drainage when flushing toiletsOdor in yard – septic breakoutInternal odorsWashing machine (grey water) drained to outside
Plumbing
Plumbing
The latest in designer plumbing!
Some Things Are Readily Apparent
Some Not So Obvious
Warning Signs of Plumbing Issues
Loose and missing grout and tiles
Loose toilet
Safety glass at tub or shower enclosures
Water odors (sulfate)
Aged piping
Leaking drain traps
Reduced water pressure
Roof
Roof transition Exposed Flashing
Roof Flashing
Defective Asphalt Shingles
ICE DAMS!!!!
Warning Signs of Roof Issues
Age of RoofRusted FlashingMissing, cupped or curled shinglesStained ceilingsCracked or missing tilesBuckets in the attic
Environmental Issues
Radon (in air and water)AsbestosLeadUnderground Storage Tanks
Warning Signs of Environmental Issues
Radon –mitigation system not functioningAsbestos – wrapped pipes, loose insulation,
vermiculite, aged floor, 6 x 6 ceiling tileLead – 1978 or beforeUST – cut off fuel lines, new gas, evidence of prior
oil tank, propane
HVAC
Warning Signs of HVAC Issues
Aged units
No maintenance tags
Odors in house or near unit
Ineffective function – not hot enough, not cold enough
Electrical
Panel, Condition & Location Problems
Warning Signs – Electrical Issues
Outdated Service sizePanel issuesExposed romexOpen junction boxesExtensive use of electrical cordsAluminum wiring (primarily used from 1965 – 1974)
Best Practices…
Make sure your client understands his/her obligations under the contract
Explain that he/she has a right to bring in specialists to investigate the condition of the property
Do not give advice beyond your area of expertisePoint out potential trouble spots and recommend a
Home InspectionDocument everything in writing
Minimize Your Risk
Make sure the Inspection Companies that you recommend have:
Errors & Omissions InsuranceFully licensed in CT and NYStrictly adhere to the Standard of PracticeStand behind their inspectionsOffer comprehensive inspection agreements