Buyers – Investigate First!
As a real estate agent, I can help point you in the right direction to make decisions in purchasing a home, vacation or investment property. Part of that decision-making process is conducting a proper “due diligence” by investigating as much about the property and the area around the property that can affect the future value and enjoyment.
The Arizona Department of Real Estate have prepared a document called the Buyer Advisory (8 pages including acknowledgement) that helps with your investigative process. E-mail me at David.Ramey@cox.net and I will send you an electronic copy of the Buyer Advisory. Some of the excerpts below are taken from this document.
Once you determine to make an offer on a piece of real property, you should consider the following investigative steps to further support your decision to purchase this property. As you scroll down, you will find that it goes for several pages (which are not all inclusive for the steps that can be taken). Remember, this may be the largest investment, whether personal or business, in your lifetime.
FIRST, walk and drive the area around the property. Many wonderful things are on the internet, but nothing beats being there in person. How does the neighborhood look? Is it near a landfill, freeway, airport, train track, major roadway, cattle feedlot or anything that may keep you and others from enjoying this property.
Schools & Universities:
The location and quality of schools and universities can be very important to many homebuyers. The Arizona Department of Education site includes both public and charter schools. On this site, you can see the Report Cards of the schools in the area you are considering. Be sure to make a personal visit to the schools to help your decision.
Arizona Department of Education
School District Web Sites
Universities & Colleges in Arizona
Homeowner’s Association (HOA) – If the property is governed by one.
Review the CC&Rs (Covenants, Conditions and Restrictions), which are deed restrictions on items like paint colors, parking, landscaping, antennas, play equipment and more. HOAs also have Articles of Incorporation, Bylaws and other Rules and Regulations which would be prudent to review. HOAs also are required to make disclosures to the prospective buyer including assessments, reserves and violations. Websites to further review regarding this are:
http://www.azleg.state.az.us/ars/33/01260.htm (HOA disclosures required)
http://www.azleg.state.az.us/ars/33/01806.htm (HOA disclosures required)
http://www.nicm1.com/ (HOA matters)
http://www.realtor.com/BASICS/condos/ccr.asp?poe=realtor (about CC&Rs)
Subdivision Public Report (for new homes/developments):
The subdivision public report is required to be provided (and you will be asked to sign a form stating that you received it) by the entity who subdivided the property. This includes raw land. For example, a major issue for land would be the access to water. This report should cover the availability to water. The following two links may be useful.
http://www.azre.gov/PUBLIC_INFO/Documents/Property_Buyer_Checklist.html
http://www.azre.gov/LAW_BOOK/Documents/HTML/32/32-2183.htm
Get A Home Inspection:
A home inspector can potentially save you money, time and troubles with a thorough examination of the home you intend to buy. Be sure that the inspector is certified to perform these duties. This service is performed for a fee and payment is usually made on the day of inspection. Most inspectors will ask you to show up the last half hour of the inspection to walk through their items of concern. Review their report thoroughly.
Arizona State Board of Technical Registration
American Society of Home Inspectors
Termite Inspection (& other wood destroying organisms):
Termites do inhabit Arizona and a termite inspection should locate any wood infestation and let you know if there are signs of previous treatment for termites.
About Wood Infestation Reports
Homebuyers Guide to Termite Treatments Made Before or During Construction
Structural Pest Control Commission (State of Arizona)
Seller’s Property Disclosure Statement (SPDS):
On this 6-page form, the Seller answers a variety of questions about the property that is being sold. Review this carefully and ask any further questions that you have. If major repairs have been made, ask to see the invoices. If an addition has been made, ask to see the permit.
Insurability of the Property – C.L.U.E. Report:
Imagine that you bought a home and found that you could not get it insured due to numerous incidents and claims on the property. One way to investigate this is to obtain a C.L.U.E. (Comprehensive Loss Underwriting Exchange) Report on the property which will give a five-year history of claims specific to that property. Ask the Seller to provide you a report. In developments such as townhouses and condominiums, the HOA provides the blanket insurance. Talk with the insurance agent for the HOA regarding any concerns.
Another step to take is to notify your insurance agent that you are contemplating a purchase of a property. That agent may be able to shed further light on this subject.
Arizona Department of Insurance
http://www.aaronline.com/documents/insurance.pdf
Title Report/Commitment:
When escrow is opened with a Title Company, the company issues a Title Report or Title Commitment that gives the conditions upon which they will provide title insurance. In this report are items listed under Schedule B Exceptions regarding encumbrances, liens and easements on the property.
American Land Title Association (Click on “Consumer Information”)
Lead-Based Paint:
For homes built before 1978, the seller must provide a disclosure form regarding lead-based point
http://www.aaronline.com/documents/leadsale.pdf (Sample of this form)
http://www.hud.gov/offices/lead/training/LBPguide.pdf (Lead Paint Safety)
Affidavit of Disclosure: (land purchases)
The Seller of five (5) or fewer parcels of land must provide the Buyer an Affidavit of Disclosure at least seven (7) days before transfer of ownership.
http://www.aaronline.com/documents/faq_affidavit.aspx
Swimming Pool Barriers:
Cities and counties can have different pool barrier laws. Be sure to check on the city, county and state laws on pool fences when purchasing a home with a pool.
Residential Pool Safety Notice
Pool Barrier Law Contact Information
State Law -- Arizona Revised Statutes 36-1681
Expansive Soil:
Arizona does have expansive soil that can cause cracking in the walls, floors and foundations. Any concerns in this area should be further checked by a structural engineer.
Natural Resources Conservation Service - Soil Survey
Soil Shrink-Swell Potential -- Greater Phoenix Area
Geological Hazards - Arizona
Land Fissures:
Land fissures have appeared in certain areas in Arizona. As a buyer, you need to have an awareness of this type of soil event and research further for your information.
http://cals.arizona.edu/AZWATER/arroyo/062land.html
http://soils.usda.gov/
Flood Plains:
Is the property in a flood zone? If so, the lender may require additional insurance.
Maricopa County -- Flood Plain Maps
http://www.azgs.state.az.us/flood_links.htm
Square Footage:
Square footage for homes is not the exact science you might think. Several appraisers can come up with different figures, but they should be very close in their results. The MLS printout has a variety of sources to use for the square footage. The county assessor’s office also has a square footage figure on record. Things do change over time with the addition of a room or the addition of a second floor. The best source for the square footage of a home is an appraiser.
Arizona Board of Appraisal -- Directory
Septic Tanks/On-Site Wastewater Treatment Facilities:
Septic Tanks and Wastewater Treatment Facilities must be inspected before the property changes ownership if the facility was approved to be used on the property on or after January 1, 2001. An inspection of facilities approved prior to this date would also be prudent.
http://www.azdeq.gov/environ/water/wastewater/septic.html
Mold:
Mold is a fact of life and it can exist in many places, including the home you are about to purchase. This issue can be of greater concern to some than others. If mold does concern you, hire a mold inspector.
Centers For Disease Control and Prevention - Mold
Mold Information Sheet
Environmental Hazards:
Although many homes do not pose a threat to you from an environmental standpoint, there are times that a buyer should check further for those things that may be an issue to them or their family. Below is a guide that may help.
A Homebuyer's Guide to Environmental Hazard
For information on Asbestos, Radon and more, check this site:
U. S. Environmental Protection Agency
Superfund Sites:
Superfund sites do exist in the greater Phoenix metropolitan area. This can be researched through the Arizona Department of Environmental Quality.
http://www.azdeq.gov/environ/waste/sps/phx.html
Freeway Construction:
The Arizona Department of Transportation is in charge of the freeway development and planning.
Transportation Planning Division - ADOT
Intermodal Transportation Division - ADOT
Arizona Department of Transportation
Military & Public Airports:
Although it is nice to be within minutes of an airport, it is not pleasant to be in the flight path of low flying aircraft. Check the flight paths and airport vicinities before you buy.
Military Airports
Public Airports
Browse Arizona Airports
Sex Offenders:
Arizona has a registry available to identify locations of sex offenders.
Sex Offender Info Center - AZ Dept of Public Safety
Crime Statistics:
Crime statistics on several cities can be obtained over the internet.
http://www.faxnet1.org/Crime_Statistics.htm
Property Boundary:
When property boundaries are an issue, a surveyor would be required.
Arizona Professional Land Surveyors
Arizona State Board of Technical Registration
Zoning & Planning:
The zoning of nearby land or the property you are purchasing can be very important. You need to check with the planning and zoning department of the city in which the property is located.
Roof Rats (Arizona Roof Rats):
Roof Rats have become a problem in certain neighborhoods in the Phoenix metropolitan area. Measures are being taken by the residents to clear the fruits from the trees & ground below and to place wire mesh on attic entrances. Information on roof rats can be found below.
http://www.maricopa.gov/envsvc/water/vector/roofrats.asp
http://cals.arizona.edu/urbanipm/rodents/roofrat.pdf
http://phoenix.gov/GARBAGE/rats2.html
Honeywell Testing Site for Jet Engines:
In the Queen Creek, Arizona area, there is a jet engine testing facility that has been there for over 40 years. When tests are conducted, the engine noises may be heard in the neighboring areas. Here is information about the location of this facility.
http://oaspub.epa.gov/enviro/multisys2.get_list?FACILITY_UIN=110002576043
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