The new real estate contract, coming out in January 1, 2012 will make the housing sell in AS IS condition. I believe that this will result in prices falling. It will also change the way we do business.
Just one year ago, the homes that were built in the 1980s or newer seemed to have features which the market wanted. They had master bedroom baths, good closets. Indeed the townhouses have been pulling ahead in the marketplace. Now the homes seem dated when they were built before 1995. The extra rain storms have taxed roofs and basements. The droughts have been hard on foundations. Buyers' are very cautious when looking a these properties because they do not want to just take on someone else's problems.
Sellers should do their bet to put the properties in top condition and consider replacing older systems. It is better to get permits when doing remodelling so that they can assure a buyer that the work was done properly. When putting a house on the market, be prepared to do a home inspection prior to marketing so that you can let a buyer know that you are ready to sell. Also, home warranties are important as they truly do mitigate costs when moving into a new home (Old Republic paid out 8 times so far this year to my clients).
In this ever changing real estate world, this new challenge of selling the properties as they are presented will lead to new norms in how we do business.
They are planning to change the way we sell real estate here in Northern Virginia. The homes are to sell in AS IS condition, not in normal working order. This will change a lot of the ways that we do business. I do believe that this will result in prices falling more than they would of without this change.
The expectations of what the buyer is getting will be lowered. We have already seen the market be particularly brutal to the older, single family homes. And indeed the older homes all seem to have aged disproportionally in the past year. Just one year ago, the homes that were built in the 1980s or newer seemed to have features which the market wanted. They had master bedroom baths, good closets. Indeed the townhouses have been pulling ahead in the marketplace. Now the homes seem dated when they were built before 1995. The extra rain storms have taxed roofs and basements. The droughts have been hard on trees.
Earlier today, at the NVAR convention, we saw a preview of the new real estate sales contract to be used in Northern Virginia. For 30 years we have been transferring in real estate in "normal working order". That is, that the buyer could expect all the items in the house to basically function as expected. And so all parties could argue about what is "Normal", and what the buyer should expect to get. Now all the buyer is told is "WYSIWYG" what you see is what you get; the house sells AS IS. However the appliance, equipment or structure is operating at the defined time is what you are buying. We have already seen the market be particularly brutal to the older, single family homes. And indeed the older homes all seem to have aged disproportionally in the past year. Just one year ago, the homes that were built in the 1980s or newer seemed to have features which the market wanted. They had master bedroom baths, good closets. Indeed the townhouses have been pulling ahead in the marketplace. Now the homes seem dated when they were built before 1995. The extra rain storms have taxed roofs and basements. The droughts have been hard on foundations. Buyers' are very cautious when looking a these properties because they do not want to just take on someone else's problems.
Sellers should do their bet to put the properties in top condition and consider replacing older systems. It is better to get permits when doing remodelling so that they can assure a buyer that the work was done properly. When putting a house on the market, be prepared to do a home inspection prior to marketing so that you can let a buyer know that you are ready to sell. Also, home warranties are important as they truly do mitigate costs when moving into a new home (Old Republic paid out 8 times so far this year to my clients).
In this ever changing real estate world, this new challenge of selling the properties as they are presented will lead to new norms in how we do business.
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