1. P R E S E N T S
Minimize Your RiskMinimize 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
2. 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 year
The median household income rose to $88,500 an increase
of $2,500
66% of recent buyers were married couples
17% were single females
7% were single males
8% were unmarried couples
3. 2016 Profile of Buyers & Sellers
83% bought single family homes
The 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
4. 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
6. What is the
NAR 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
7. What is the
NAR Legal Pulse?
Quarterly newsletter - analyzes current legal trends
in risk management that impact real estate
professionals (nationally)
Tracks cases and statutes
Identifies emerging issues and trends
www.realtor.org
8. 2015 Legal Issues
by Major Topic
____________________________________________________________
Topic Cases
Agency 74
Property Related Conditions 49
RESPA 40
Fair Housing 32
10. Caveat Emptor
The doctrine of “Buyer Beware” is gone….
Replaced by Agent Beware!Replaced by Agent Beware!
Realtors are held to a higher standard
“What do you know about the property” has been
replaced by “What should you know about the
property!”
11. Today’s AgendaToday’s Agenda
• Help you develop an awareness of what to
look for (without turning you into home inspectors)
• Highlight warning signs of possible defects
• Overview of Top 10 Property Conditions that
most often result in disputes
12. Why is this information important?
Happy, well informed clients, mean more
referrals (and no disputes)
More referrals = more earnings
Minimize your risk by having a greater
awareness and understanding of adverse
conditions
19. Warning Signs of Water Intrusion
Poor grading
Inadequate ventilation
in crawlspace or attic
Cracks in foundation
Efflorescence
Roof stains in attic
Missing roof shingles
Stains on ceilings
Newly painted
foundation/floors
Water stains
baseboard/furniture
legs
Mold
Sump pump
Downspout not
extended
Window rot
26. Warning Signs of Structural Issues
Sloping or sagging
floors
Overly snug fit to floors
and windows
Cracked tile floor
Excessive concrete
cracking and
separation
Alterations without
permits
Sagging beams
Funky
supports/columns
Stair riser/tread size
Crushed sills/joists
Suspicious homeowner
repairs
39. 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
44. Warning Signs of Roof Issues
Age of Roof
Rusted Flashing
Missing, cupped or curled shingles
Stained ceilings
Cracked or missing tiles
Buckets in the attic
46. Warning Signs of Environmental Issues
Radon –mitigation system not functioning
Asbestos – wrapped pipes, loose insulation,
vermiculite, aged floor, 6 x 6 ceiling tile
Lead – 1978 or before
UST – cut off fuel lines, new gas, evidence of prior
oil tank, propane
51. Warning Signs – Electrical Issues
Outdated Service size
Panel issues
Exposed romex
Open junction boxes
Extensive use of electrical cords
Aluminum wiring
(primarily used from 1965 – 1974)
52. 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 expertise
Point out potential trouble spots and recommend a
Home Inspection
Document everything in writing
53. Minimize Your Risk
Make sure the Inspection Companies that
you recommend have:
Errors & Omissions Insurance
Fully licensed in CT and NY
Strictly adhere to the Standard of Practice
Stand behind their inspections
Offer comprehensive inspection agreements
I think we can all agree, we enjoy smooth transactions. Disputes are time consuming and tough. Whether they are resolved through conversation and negotiation or through complex and expensive litigation – it’s something we would all like to avoid. Today we’re going to discuss the top 10 property conditions that most often lead to disputes. In the more than 20 years that we’ve been doing home inspections, we’ve seen these conditions over and over again. Today we’d like to help you learn to identify and understand these conditions and develop an awareness of what to look for - so that you may better inform both your buyer and seller clients, and in turn, minimize your risk.
But, before we get into the meat and potatoes of our seminar, let’s first take a look at today’s buyers and sellers…
Legal pulse summarizes national trends and discusses representative cases.
2015 no environmental cases, but other years did have radon, asbestos issues.
Other/misc - stigmatized property, megan’s law, electromagnetic field, valuation, etc
#71
#72
#75
#74
#67
#78
Washer hose
Water Pressure
Roof transition, missing flashing and damage; exposed flashing