Solid Offers with Buyer Protections

It’s probably no surprise to you that the real estate market in Arizona (and most of the country) is insanely hot. We’re seeing buyers and sellers make mistakes in this market and wanted to use this months market update to educate you on some issues regarding the real estate transaction you may not know. The is John Schloz with this month’s real estate market update. When a seller lists their home in Arizona, they can give their agent permission - or withhold permission - to disclose the terms of any offers to other agents. Allowing an agent to disclose the terms of other offers gives that agent the ability to create a bidding war, often bringing in better offers in a competitive bidding situation. And, Realtors are bound by the code of ethics to treat all parties honestly, so we must be truthful in negotiations. Complicating matters, in Arizona, Dual Representation is permitted, allowing a broker to represent both the buyer and the seller in the transaction. If an agent receives an offer from another agent in the same brokerage however, laws of dual representation limit the agent on disclosure, since we must protect the interests of all represented parties. Some buyers these days are going straight to the listing agent hoping to garner an advantage in negotiations. However, depending on the ethics and integrity of that agent, this can also hurt that buyer when it comes to full representation. Make sure your agent a trusted advisor. Buyers in today’s market are waiving their rights from the contract. The AZ standard residential purchase contract has many protections written in for both buyers and sellers. The standard contract is written as an AS-IS contract, putting the obligation of due diligence on the buyer. State law requires sellers to disclose any material facts that might negatively affect the value of the property. Waiving the use of the Seller Property Disclosure form does not alleviate the seller from that obligation. Buyers waiving their rights to an inspection can put themselves in a very costly and dangerous position. If a buyer is looking for ways to compete, they could waive lines 273 - 284 of the contract still allowing them to inspect the property but retaining the right cancelling if something unacceptable comes up, but letting the seller know the buyer will not ask for repairs following the inspection. It’s a tricky market. Make sure you work with an agent who understands the contract and the risks involved in a real estate transaction. Make sure you work with a trusted advisor. Like me, John Schloz HomeSmart