By Lou Jewell ALC on July 22, 2009
Anyone involved in a typical Land transaction, leasing, buying or selling may be exposed to 93 plus potential Land issues. For years now I have advocated for need of a "Land Disclosure" form throughout our country. So far only four states have such a document available for the real estate industry and they are Arizona, California, Georgia and Tennessee.
Most states have "Residential Property Disclosure" forms which are executed at time of the listing by the sellers and reviewed and signed off by the buyers during the offering process. We recommend these forms to also be used even in cases where you are selling without the assistance of a real estate firm.
North Carolina's "Residential Property Disclosure" form has only twenty-one issues, far less than the Land form who should have and fewer than other comparable forms found around the country.
Here are a few examples of the ninety-three plus potential Land Disclosure issues currently in place by the four states previously mentioned.
"Are you aware of any?"
Land can have a lot of issues and knowing all the aspects involved is critical for all involved in any of these transactions.
The Real Estate Industry "Realtor®" program has an established "The Realtor® Code of Ethics" as a guideline for practicing real estate. This code has seventeen articles. Article 11 states:
"The services which Realtors® provide to their clients and customers shall conform to the standards of practice and competence which is reasonably expected in a specific real estate disciplines in which the engage; specifically, residential real estate brokerage, real estate syndication, real estate auction, and international real estate." (Our Professional Standards Committee voted unanimously in Washington in May this year at the NAR Mid-Year Convention meeting to include the four letter word "Land" in Article 11 of the code, subject to the Executive Committee final approval this fall).
"Realtors® shall not undertake to provide specialized professional services concerning a type of property or service that is outside their field of competence unless they engage the assistance of one who is competent on such types of property or service, or unless the facts are fully disclosed to the client. Any persons engaged to provide such assistance shall be so identified to the client and their contribution to the assignment should be set forth." (Amended 1/95)
See: http://www.realtor.org/MemPolWeb.nsf/pages/Code
Unfortunately when one goes to real estate school around the country and takes the 160 +/- hours of classroom instruction and testing, they are not taught about Land, Commercial real estate, Property Management, etc., only about residential property and real estate law. Do not assume that all real estate agents have the knowledge in the specific areas of brokerage.
If you are buying or selling Land or Farms or Ranches, make sure to find a member of the Realtors Land Institute to help you in this process. Specifically look for an Accredited Land Consultant, their Designation for those experts in Land who have worked hard to achieve it.
See: http://www.rliland.com for the nearest RLI agent and the RLI programs and educational opportunities.
Consult with a Land attorney if you plan to create your own "Land Disclosure" form. If you are a real estate agent, please check with your Broker-in Charge before creating or using even if your state has a standard required "Land Disclosure" form already approved. The potential risks and liabilities created because of non-disclosures can be very costly.
Related articles:
Posted in Due Diligence | Tagged Land Disclosure, Residential Property Disclosure, The Realtor® Code of Ethics