Thursday, October 09, 2014

Home selling tips: A tale of storage wars at East Lakeview final walk-through

I was in the East Lakeview neighborhood early this week for a final walk-through at our 416 W Briar listing (sold for $528,500). The final walk-through is a custom where the purchaser physically walks the property prior to the closing.  The expectation is the property should be empty and delivered as agreed upon in real estate purchase contract.
The building at 416 W Briar in East Lakeview.  I was at the final walk through of our top floor listing on Tuesday.

Step one: Move out!  416 W Briar Unit #3 vacated prior to the walk-through and closing.
The sellers had moved out completely by the time of walk-through and the cleaning people were working at the unit. The buyer was satisfied with the walk-through of the unit. Everything was left intact as expected.  However, there was an issue with the storage area in the basement.  Another unit owner had personal property stored in the designated area for our listing. An additional storage space was full of construction debris from a recent rehab.  The purchaser, understandably, wanted it moved prior to the closing scheduled later that afternoon.

Construction debris left in the purchasers storage space at walk-through
Although there was no legally assigned storage spaces in the property title nor the condo association bylaws for any of the units, the Condo Board did have a professional plan drawn up designating storage units earlier this year.  Additionally, the storage unit construction project was documented by the Board in the legal 22.1 Disclosure form (sort of the "State of the Condo Association" given to the buyer upon his/her executed contract). Thus, the buyer's expectation was the storage space (the actual square footage) in the basement would be open for their use. The unit owners, however, had simply not completed the project or moved their stuff.

The huge front terrace of 416 W Briar overlooks a quintessential East Lakeview city block.
This was a problem. Buyers and sellers can get upset about large and small issues near closing time and sometimes even be irrational. Lots of scenarios could unfold. The buyer could refuse to close that day (or for a long period of time... or try to walk away from the deal). The seller could try to receive earnest money from the buyer for not closing on time.  These are just a few examples.

Bob and I work hard through the entire transaction to avoid worst case scenarios if and when issues arise.  First, we work to avoid any issues ahead of time.  In this case, we made sure our sellers would be out on time and their storage removed.  We did not account for the OTHER owners' stuff.  

Secondly, with all documentation and contacts from the transaction at hand, we took measures immediately to communicate with the seller, the condo association and sellers attorney to suggest a few scenarios to solve the issue.

Third, we made ourselves and our resources available to carry out the solutions.

Most importantly we closed the deal for our seller that afternoon.  Bob negotiated a $5,000 escrow "hold back" from settlement proceeds to be held for one week after the closing (way down from what the buyer wanted initially). The seller would have means to work with the association to move the personal belongings to its rightful space.  The escrow monies would be returned to the seller after the personal property was moved.  If after seven days the personal property is not removed the seller could recoup their costs for moving it themselves. The excess funds from escrow would be returned to the seller. 

Deal? Deal.

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