Question (GA & TX): I want to sell an unimproved lot in Fulton County, Atlanta Georgia. How can I estimate the value of the land short of a formal appraisal? Also, I want to buy 7.5 acres in Houston, Texas. How can I know what is a fair market value for land in that area?

Answer: For both Fulton County, Georgia and the Houston, Texas areas, we recommend you contact a Realtor. Be up front with the Realtors with whom you talk. Inform each one what you are seeking and why. Of course, we also recommend that you hire a Georgia Realtor to list your Georgia property and a Houston area Realtor to represent your interests under a Buyer Representation Agreement, as opposed to doing it yourself as a FSBO (For Sale By Owner) in Georgia and a non-represented buyer ("customer") in Houston. What you want the Realtors to do for you is a "CMA" or Comparative Market Analysis (sometimes also referred to as a "Competitive Market Analysis").

You may wish to also enter the property details in an AVM ("Automated Valuation Model") such as Zillow.com, Cyberhomes.com, or others that appear in your favorite search engine when you enter "Automated Valuation Model" in the search bar.

AVM's are an affordable (most of them are free) beginning point, in our opinion, but may or may not supply you with an accurate snap-shot of the market value of the subject property. A Realtor's CMA is an excellent source for a property's indicated market value. Then, in order of least expensive to most expensive, there is a formal appraisal of a subject property performed by a Certified Appraiser.

Question (MA): I purchased a house 3 months ago. The previous owner made some improvements without the required construction license. If a building inspector finds out about this, which person is responsible for those improvements: me or previous owner? And what are the consequences? Do I have to fix what was done before I bought the house? What if I am satisfied with those improvements?

Answer: The answers to most -- if not all, of your questions can be obtained by accessing this site. We suggest that you contact Mr. Bill Thornton, Building Inspections, City Hall, Room #04, 70 Allen Street, Pittsfield, MA (Phone: (413) 499-9440).

The purpose of your call is to find out what is the best way to handle what you have recently discovered after you purchased the property. The person, with whom you speak (if it is not Mr. Thornton), will most likely ask you what types of improvements were made to the house and whether they were under $1,000 (You might qualify for a Home Improvement Affidavit to be filed as an attachment with the construction permit application). The basic idea you want to get across is that you bought the property unaware that the previous owner had made non-permitted (also called "unlicensed') improvements. You will probably also be asked for the identity of the previous owner (that should be available from your closing papers).

You ought to get the problem solved by reporting its existence to the appropriate department (Building Inspections) because you will most likely be required to disclose the work that was done when you sell the property.

Question (NV): We sold our home in May 2006 .The buyer asked us to increase the sales price of the home from $560,000 to $580,000. The buyer wanted $25,000 towards concessions and a three wheeler sitting in our garage. We paid 3 percent towards closing cost ($17,400). The buyer wanted us to give him a check for $25,000 after the close of escrow.

We felt this was fraudulent and refused. We recently received a letter from the buyer's lawyer stating we didn't fulfill our agreement and therefore we owe the buyer a check for $25,000 to be mailed to the lawyer's office. The buyer is a real estate agent and flips homes for a living. Have we been flipped?

Answer: We don't mean to be "flippant" about a potentially serious situation but there is a distinct possibility that you have.

Your Nevada purchase and sale contract with the buyer contains all the terms and provisions of the contract. No changes have any force or effect until all parties to that contract provide a written agreement to amend the contract. In general terms, whenever a contract for residential real estate calls for a higher sales price than the original asking price, and furthermore calls for a $25,000 amount to be paid to the buyer out of the closing (i.e. not disclosed on the HUD-1), it smells fishy! We are assuming you did close on the sale of the property at your original asking price, and that you did not send the buyer $25,000 because you never agreed to that in the contract. Thus, you received the letter from the buyer's lawyer after the sale concluded.

Without seeing the documents involved it is impossible to offer an opinion, but essentially if it walks like a duck, quacks like a duck, and looks like a duck, there is a high probability that it is a duck! The word "duck" in this example represents mortgage fraud.

Question (VA): We purchased our home in Manassas, VA, just over 1 year ago. The home was built in 1981 and currently has both a well and septic system. My question is about the well and my feeling that we were not properly informed of its history and problems.

Approximately 2 months after moving in the well went dry while my wife was in the bath. It took approximately 8 hours to get our water back up and running. Since then this has only happened a few other times as we are careful and watch when we shower, do laundry and run the dishwasher.

Do you know what if any recourse we may have with the previous owners?

Answer: The very first question we would ask is whether or not you obtained an inspection of the property including the well. If you did, what were the results?

Whether you have any recourse against the owners depends upon what type of document they provided you as required by the Virginia Residential Property Disclosure Act. If they signed a Residential Property Disclosure Statement, they would have to set forth the property's condition including any known defects in the water system. If, however, they signed a Residential Property Disclaimer Statement, then the sellers make no representations or warranties as to the property's condition except as otherwise provided in the purchase contract.

We recommend that you get your real estate documents out and look at the purchase contract and whether or not the seller provided the Disclosure or the Disclaimer Statement to you. There is the possibility that if you can prove the sellers misrepresented anything about the condition of the water well and its history, you might be able to assert misrepresentation and concealment of material facts. Should you choose to go down this road, however, we recommend that you hire an attorney to review your documents and advise you regarding the merits -- if any, of your case.

Published: March 13, 2007

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