Friday, July 27, 2012

The Inspection Objection

Sometimes a Buyer will get nervous when the moment finally comes to sign a contract.  He may be afraid that he could change his mind about the property, or that perhaps there's "fine print" that commits him to do something he didn't intend.  I always make sure that my buyers understand that the contracts Realtors use are standard, Real Estate Commission approved documents, and that clients are most welcome to take them to an attorney for review if they feel at all uneasy.

I also explain that the Colorado Contract to Buy and Sell Real Estate offers several protections for the Buyer, opportunities to terminate the transaction and get earnest money returned.  For instance, should the bank appraisal come in much lower that the agreed upon purchase price, the Buyer can negotiate with the Seller or terminate the contract.  Or if, in fact, he can't get approved for the loan and terms he thought he could afford, he can legally cancel the agreement.

Another opportunity to terminate is presented during the property inspection period.  Often, buyers hire a professional inspector, sometimes several, to go over the property more closely to discover any defects that were not apparent during regular showings.  The inspections can range from a standard once-over of the structure and systems to sewer scoping and radon tests, but include anything that can be discovered about the property by the Buyer.  For instance, upon further investigation of the area, the Buyer may find that the empty land behind the home is not zoned residential, and decides that he doesn't want to back to future commercial buildings.

A few things to remember about the inspection period.  Even though the Buyer does not have to disclose the specific reason for the termination, he had better have one.  The purchase agreement states that the Buyer is signing the contract in good faith, meaning that he fully intends to follow through with the purchase of the property.  If the Seller has reason to believe that the Buyer did not act in good faith when he terminated the contract (e.g., really just wants to buy another home instead), the Seller may be able to make a case to retain the earnest money as liquidated damages.

Another important point to keep in mind when addressing inspection issues with the Seller:  the Inspection Notice is not intended to renegotiate the deal.  It is to address significant structural, system or safety issues that affect the value of the home the Buyer thought he was getting.  A Seller will assume that a Buyer has taken into consideration the apparent condition of the property when making his offer.  She will expect that the offer price reflected the understanding that the fence is falling down and that the front door will need to be replaced.  She should expect, however, to repair, replace or otherwise compensate the Buyer when his inspection reveals that the A/C unit is not actually functioning.

Sometimes in a seller's market, buyers are forced to move quickly on properties they may not have had the time to fully consider.  Especially in the case of multiple offers, a Buyer may feel that he has ultimately overpaid during a bidding war and will try to use the inspection items to recoup his money through significant Seller concessions or a price reduction.  This is why it's important to have a Realtor who knows the area well arm you with current sales data and professional advice.  Proceeding knowledgeably from the beginning will put you in the strongest negotiating position and pave the way for a smoother transaction.

images:  Marc van der Chijs, AmberStocel

I would love to help you with your real estate journey. 
Please contact me at 303-917-7143 or

Thursday, July 5, 2012

Broomfield: Go Big or Go Home

I recently attended a presentation conducted by Broomfield city and county officials, outlining and updating development plans.  I was actually a bit overwhelmed by the end; there's a lot going on, and the future growth promises to bolster recent momentum.

There are currently six single-family residential projects either proposed or underway:
Lambertson Farms Landscape Plan

  • Anthem - southeast of Highway 7 and Sheridan Parkway, 3,500 units.  Anthem is composed of Anthem Ranch, 1,700 age-restricted units, and Anthem Highlands, 1,800 single-family units.  Homes range from $240,000 to $570,000, and the development is about 40% completed.
  • Ashwood - west of Zuni Street and north of 144th Avenue, 32 units.  Homes range from $500,000 to $700,000, and is 20% completed.
  • Spruce Meadows - west of Zuni Street and just north of the Ashwood neighborhood, 73 units.  Homes range from $800,000 to $2,000,000, and is just over 60% completed.
  • Silverleaf - northeast of 144th Avenue and Lowell Boulevard, 71 units.  Homes range from $420,000 to $650,000, and Taylor Morrison will begin pulling permits this year.
  • Lambertson Farms (McKay Shores) - northwest of 136th Avenue and Huron Street, 192 units.  This development also includes 357 additional units (townhouses and apartments), as well as two commercial centers and athletic fields.  Single-family dwellings range from $350,000 to $1,200,000 and is just beginning construction.
  • Skyestone - Simms Street and 108th Avenue, 432 units.  The site construction for these patio homes is underway.
In addition, there are six mixed-use developments planned or proposed for northeast Broomfield:
  • North Park - 935 acres, will include a town center, 17 million square feet of commercial development, and up to 6,000 multi-family residential units.
  • Palisade - 155 acres, currently includes Childrens Hospital and a Federal Records building. It's zoned for 500 single-family dwellings, 500-multi-family dwellings, 1.5 million square feet of commercial development, and a proposed 203-unit multi-family residential project.
  • Highlands - 145 acres, zoned for both residential and commercial development, including an 11 acre park and 800 residential units.
  • Northlands - 132 acres, including retail, commercial and 325 multi-family residential units.
  • Seven25 - 134 acres of mixed-use development, including 300 multi-family units.
  • 257 Land - 500 acres, including commercial and office space as well as 1,200 single-family units and 1,500 multi-family units.
On the south side of the city you'll also find, in various stages of construction:

Arista's aloft Hotel
  • Avenue 120th Apartments - 120th Avenue and Lowell Boulevard, 302 multi-family units.
  • Harvest Station -  Wadsworth Boulevard and 118th Avenue, 536 multi-family units plus commercial.
  • Arista - Uptown Apartments, 272 units, Venue Apartments, 116 units, AMLI Apartments, 166 units, and 62 paired KB homes.
  • Parkway Circle - US-36 and the Northwest Parkway, 1 million square feet of commercial development including the Hyatt House Hotel, and 648 multi-family units.
  • Broomfield Business Center - Northwest Parkway and Via Varra, commercial, office, retail and 500 multi-family units.
  • Interlocken - Camden Flatirons, 424 multi-family units, AMLI, 374 multi-family units.
  • Carmel - Coalton Road and Summit Boulevard, 1,075 multi-family units.
Whew!  After a severe drop-off in building permits the past three years, projections for 2012 and 2013 show a significant increase, especially for multi-family residential projects.  Check the city's website for an updated map of approved residential projects and other development updates.

Of course, all of this construction means simultaneous pursuance of infrastructure goals, such as transportation and water supply, which city officials purport to be on top of.  Check in here in the future while I follow the progress of these various projects, and let me know if you'd like to get an inside peek into any of them.

I would love to help you with your real estate journey. 
Please contact me at 303-917-7143 or