Feb 18, 2022

The market continues to be on fire. We are in uncharted waters as far as the demand gap goes. This extreme sellers market has never been seen before and it will be up to investors to correct it in the coming years through flips, rental purchases or new construction. Flips and rentals are easy to get funded, but new construction is still very difficult to find to all investors except those that have a lot of recent experience and deep pockets. One thing that commercial lender rules makes could do is to loosen the requirements for qualifying for these new construction loans and allow us to build our way out, quicker.

If you use your own contracts when purchasing off-market properties, I read a great post online that will prevent sellers from selling the property behind your back. (it happens) This poster has language in his contracts that read:

Seller agrees by executing this contract that buyer has the remedy for breach of contract by the seller to record a memorandum of contract to enforce its rights and interests in the property. The memorandum is to protect Buyers interests and enforce its rights to purchase the property“.

As a disclaimer, seek advice on this line item in the contract, but it would protect you and your interests in the property. If you have any advice or experience with this, let me know and I’ll share it.

Realtor tip of the week

Let’s discuss seller disclosures. As a Seller in FL and use a Realtor or not, you will be required to fill out a disclosure form. In this form, you will need to disclose the following information:

Material Facts/Defects. These are items that can affect the value of the property known to the seller that may or may not be obvious to a potential buyer. (leaking sewage drain field, etc) By the way, a homicide, suicide or death in the property is NOT a material fact.

Endangered Species. Gopher Turtles are cute but can get you in serious trouble if you try to relocate them or a nest. Consult with wildlife officials.

Radon disclosure. A disclosure is already inside a FL Realtor contract, include it in yours if you sell FSBO. It is not required for short-term rentals.

Code enforcement actions. This is obvious but if you are in violation, buyers need to know. It will be found anyway during a municipal search conducted by the title company. Disclose up front.

Insulation information. In a new construction home, it must be disclosed what kind/type/R-value of insulation that was used in the building process.

The best rule is always to disclose any known issues that may affect the value of the property.

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