Archive » January 25, 2007
Real Estate View
By Mark Schneidman
(Mark has lived in Santa Barbara since 1977 and has been a full-time realtor with Coldwell Banker since 1988. He is host of “Radio Real Estate,” broadcast on KZSB 1290 AM live on Monday mornings at 11 am and rebroadcast on Monday evening at 9 pm and again on Saturday at 2 pm. If you have a real estate question you would like answered, please send it to Mark at: www.RadioRealEstate.com™ and he will respond via this column.)
Do Nice Guys Finish Last? Not in Real Estate
To ‘win’ in real estate you should be a nice guy (sorry ladies, please allow me to use this gender-specific expression). You need to be tenacious, tireless, educated, experienced and persistent without being pushy – although some pushiness is tolerable and acceptable, especially if you first ask permission to do so. But the icing on the cake is to “be a nice guy.”
Of course we can say this about all professions and walks of life but it rings particularly true in working small town Santa Barbara real estate. Everybody knows everybody. While you are sitting in Jeannine’s reading this paper there is at least one real estate agent within 10 feet of you and at least one real estate-related conversation going on that you can overhear.
This recent inquiry helps illustrate my point:
My sister was the buyer in an escrow in Santa Barbara that she canceled. The seller requested a copy of the home inspection report and she has refused to hand it over. Do we have to give the seller a copy of the home inspection report? The listing agent is threatening to take us to small claims court. We both live out of state but she will return to Santa Barbara to purchase something else.
The Residential Purchase Agreement says the buyer shall give the seller all investigative reports obtained by the buyer.
The contract was written this way so that the seller has written notice of any and all defects discovered about the property. This, in turn, insures that future buyers will have all available information in front of them so that they can decide on the value and desirability of the property.
What might appear contraindicated to this approach is that the contract does not specify the exact parameters allowing the buyer to cancel the escrow. The buyer must remove the inspection contingency within the agreed upon time period or cancel the escrow. Sellers facing a failed escrow want to put the property back on the market quickly to find another buyer.
Irrespective of your contractual obligation, I’m wondering why you would not readily turn over the report to the seller. One scenario might be that you believe the seller misled you, that had you been made aware of certain information in advance you would not have spent the money on the home inspection report.
I will give you the same answer whether that was the case or not: Give him a copy of the report. If you don’t want to fax or mail the report, then fax the home inspection company authorization to give the report to the seller. In situations like this, the next buyer might pay the home inspector a small fee to meet and discuss the report at the subject property. It will not cost you anything but it may pay dividends down the road.
Based on the threat of small claims court, it sounds like there was some bad blood between the parties. Take the high road. Number one, because “Goodness is the only investment that never fails” (Thoreau); and number two, the next house your sister wants to purchase might be listed by the same agent. If not, it will be a friend of the listing agent or in some “Six Degrees of Separation” fashion will be reconnected back to this first failed escrow. Your sister does not want to be one of two buyers bidding on a property where she is known as “the ungracious buyer.” Don’t burn a bridge.
The Withholding Front
For escrows closing on or after January 1, where the real estate withholding of 3.33% requirement applies, you now have an alternative. For individuals, you can make an election to withhold 9.3% on the gain or the 3.33% on the total sales price. The Franchise Tax Board will provide an electronic form to assist you in computing your gain. Go to www.ftb.ca.gov. One of the exemptions for the real estate withholding is that the property qualifies as the seller’s principal residence under Internal Revenue Code Section 121.
The statements made regarding the contract’s content and tax information are my personal opinion and in no way should be construed as legal or tax advice. Seek the advice of an attorney and accountant for your specific circumstances.
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