The legal requirements for brokerage relationships in Colorado between buyers or sellers and their Realtor is one of the somewhat confusing areas of Colorado real estate law. In order to aid in understanding, we will define each of the relationships and their roles below.

Sometimes historical perspective helps in understanding why the current system is in place.  Prior to the Brokerage Relationship Act in 1994, every real estate agent in Colorado was assumed to be an agent or a subagent for the Seller. This obviously could cause confusion, conflict of interest and frustration in transactions.  As an example, if a real estate agent showed property to a potential buyer and that buyer disclosed a maximum price s/he would pay for a home (and perhaps even offered a lower price), then technically, the real estate agent as the seller's agent and fiduciary for the seller was required to disclose the buyer’s position to the seller.  This was an untenable legal situation and looking back twenty years later, it is hard to believe that was how real estate agents were required to conduct business between buyers and sellers.  

The 1994 law was enacted to allow for Buyer's Agency, Seller's Agency, and Transaction Brokerage.  Today Real estate brokers and their clients can choose which capacity works best for them among the following options.

Sellers Agency.  A seller’s agent (or listing agent) works solely on behalf of the seller to promote the interests of the seller with the utmost good faith, loyalty and fidelity. The agent negotiates on behalf of and acts as an advocate for the seller. The seller’s agent must disclose to potential buyers all adverse material facts actually known by the seller’s agent about the property. A separate written listing agreement is required which sets forth the duties and obligations of the broker and the seller.  Buyers Agency.  A buyer’s agent works solely on behalf of the buyer to promote the interests of the buyer with the utmost good faith, loyalty and fidelity. The agent negotiates on behalf of and acts as an advocate for the buyer. The buyer’s agent must disclose to potential sellers all adverse material facts actually known by the buyer’s agent including the buyer’s financial ability to perform the terms of the transaction and, if a residential property, whether the buyer intends to occupy the property. A separate written buyer agency agreement is required which sets forth the duties and obligations of the broker and the buyer. Transaction-Broker: A transaction-broker assists the buyer or seller or both throughout a real estate transaction by performing terms of any written or oral agreement, fully informing the parties, presenting all offers and assisting the parties with any contracts, including the closing of the transaction without being an agent or advocate for any of the parties. A transaction-broker must use reasonable skill and care in the performance of any oral or written agreement, and must make the same disclosures as agents about all adverse material facts actually known by the transaction-broker concerning a property or a buyer’s financial ability to perform the terms of a transaction and, if a residential property, whether the buyer intends to occupy the property. No written agreement is required.  The Wells Group has specific standard procedures regarding disclosures to buyers and sellers regarding the above brokerage relationships.  Overall, understanding how your real estate agent may assist you is important prior to entering into real estate transactions. Please call our office if we may assist in explaining further, or if you have additional questions or scenarios you would like to discuss.  As always, we are not providing legal advice, and if you have specific questions, please seek appropriate legal advice from your attorney.

The Wells Group has specific standard procedures regarding disclosures to buyers and sellers regarding the above brokerage relationships.  Overall, understanding how your real estate agent may assist you is important prior to entering into real estate transactions. Please call our office if we may assist in explaining further, or if you have additional questions or scenarios you would like to discuss.  As always, we are not providing legal advice, and if you have specific questions, please seek appropriate legal advice from your attorney.

Don Ricedorff, Broker Associate, GRI, CRS, CCIM, ABR, RSPS, CDPE

E-Mail: don@durangorealproperty.com

Direct:  970-375-7014

Fax:  970-259-5007

Web: www.DurangoRealProperty.com

Member of Rocky Mountain Commercial Brokers
www.RMCBrokers.com

Camping in Southwest Colorado

Backpacking is the most strenuous of the camping activities, but many would argue it’s the most rewarding. With the plethora of mountains in our own backyard, getting to the “top of the world” scenery is best done by foot. Unlike many other places, backpackers in Southwest Colorado truly have the ability to enjoy the remote outdoors—and actually be alone in nature. Some of my best experiences over the years have revolved around backpacking in Colorado. I love the views and the hikes, and the satisfaction of packing all of the necessities to the camp spot. With my kids, we have enjoyed numerous backpack trips into Hermosa Creek, Bear Creek, Verde lake, Island lake, and others.  Of course, we would recommend either having outdoor experience or going with someone who has that experience for first time backpackers.

Car camping/tent camping also has its place in our area. There are so many places that allow car camping, and the best part is a person does not have to go far to find it! In many ways, car camping combines the best of all worlds—it allows campers to discover remote locations, but does not require such minimal provisions to be packed. Essentially, ice chests, tents, sleeping bags, etc., may all be kept in the car and do not need to be transported to a camp site (as is the case for backpacking). Campgrounds are also a great option. In Colorado, many campgrounds offer a “remote” experience, even if they are technically campgrounds. Transfer Campground outside Mancos, and Burro Bridges at Dunton are two of our favorites; we have had camping trips there that have felt like we were the only ones on the mountain!

Then there is the recreational vehicle world. I must admit at this point in my life this experience is more appealing! Durango offers campgrounds in town and right outside town. These campgrounds offer the hookups and amenities that RV users appreciate. Also, several people enjoy taking trailers up La Plata Canyon, the Jersey Jim area in the La Platas, and the backside of Durango Mountain Resort. When we owned a travel trailer, we even enjoyed taking it to Utah in the spring to catch the early warmer weather.

While these camping experiences all vary, the great news is that Durango offers a customizable camping experience that anyone may enjoy. The outdoors, views, clean air, and time to recharge are such great benefits to this relatively inexpensive activity. As summer is here, it is the perfect time of year to go explore our beautiful outdoors.

Positive News On Interest Rates

In other news, Elliot Eisenberg notes the positive future in regards to interest rates. According to a press conference today, Fed Chairwoman Yellen suggests that the Fed will keep interest rates low, and "allow inflation to systematically exceed 2%." She did away with forward guidance, and suggested various economic reasons/indicators to set policy. This is great news for interest rates on homes, as they remain historically low. While interest rates will rise at some point, it appears that we are still in a "sweet spot" to take advantage of these low rates.


Source: Elliot F. Eisenberg, Ph.D.

A Year To Date Comparison: 2013 VS 2014

This week we wanted to focus on overall real estate activity year to date for La Plata County in comparison to last year’s activity through this time. Below are several categories of properties in the county. If you are considering purchasing a home, you can see where increased activity has occurred this year. If selling a property is a consideration, the numbers indicate which market segments are currently experiencing more activity. 

A few areas to note:

The current sweet spot for Durango in-town and Durango rural properties is the $250,000-500,000 range.

The majority of in-town condos/townhomes fall under $350,000.

The Bayfield price range most typically falls under the $250,000 range as well.

For additional questions or more specific information, please contact our office.

Mesa Verde & Beyond!

The Four Corners area is a true window to history. In fact, we have the rare ability to see the lifestyles of the earliest inhabitants in the area. The Anasazi, which means “Ancient Ones” first lived in the area around from around AD 600 to AD 1300. Then, they mysteriously left the area, and the reason has never been clearly identified. Obviously, this even puts perspective on our recent history! It is amazing to see the way they utilized the natural growth and cliff areas for homes, as well as the mesas and seasons to produce the necessary crops and water sources to sustain life.

Mesa Verde National Park is the most well-known and well-traveled in the area, but other places exist to explore the ruins as well. The Mesa Verde area boasts thousands of archaeological sites, and visitors can walk through the ancient community buildings. Many are built in the cliffs. Notably, Cliff Palace and Balcony house are astounding, as they are preserved to display the ancient lifestyles. Guided tours allow visitors to see the lifestyles and customs held by the Anasazi. The views and adventure even going through the ruins is an experience unlike any other. It is so hard to fathom the amount of work and dedication necessary to create these dwellings.

A day trip to Mesa Verde is an all-day experience. Although the drive to the entrance is not far from Durango, allow some time to get to the top, as well. Most visitors like the majority of the day in the park. Hotels and camping are both options inside Mesa Verde as well. Our family has enjoyed visiting Mesa Verde for years. When we first moved back to Durango (over 20 years ago now), we had so many visitors from out of town, we went to Mesa Verde multiple times per summer. I’ve even gone at least once each of the last couple years. There is so much there to see that it never gets old taking a day trip to visit and explore.

Also in the Four Corners area, the Aztec Ruins in Aztec, Ute Mountain Tribal Center, Chaco Canyon, and Canyon de Chelly all offer various sets of ruins to see. Many of these areas feature hiking trails and scenic drives to see the sites. They tend to be less populated, but each area offers unique views and a step back in time.

It is so amazing to explore these areas and feel the sense of history around us. Generations and civilizations of people have enjoyed the Four Corners, and we are so fortunate to be able to get a glimpse into the life they once lived.

Importance of Home Inspections

Home inspections are a perfunctory part of a home purchase. Oftentimes, results of a home inspection indicate minimal areas to fix in a home. Sometimes, however, the results of a home inspection will indicate issues that should receive serious consideration prior to the purchase of a home.

A few key categories impact home inspections.

Health &  Safety Issues:

Sometimes the results of home inspections indicate potentially dangerous health hazards in a home. For that reason, health and safety issues are the kind of problems that most often result in inspection objections by buyers.  But, it is important to note that most of these health and safety issues can be completely mitigated and once a successful mitigation occurs a home can be safely purchased free of the health and safety concerns.

Mold can be a condition found in some homes. Mold spores are natural and they are in the air of every home, and they grow in moist areas. There are concerns If mold is left untended, it can cause headaches, illnesses, eye irritation, and rashes. Mold can also cause the disintegration of wood, and long term mold exposure may affect the structural integrity of a home. The key to resolving mold issues is removing the moisture issue, treating the mold, and remediating any structural issues.  Mold usually can be successfully mitigated and should not impede the successful closing on a purchase if the parties to the transaction are willing to reasonably negotiate the necessary mitigation.

Radon is another health and safety factor to consider. High levels of radon in a home has the potential to cause lung cancer, and it is claimed to be the second leading cause for lung cancer. Fortunately, as with other health and safety issues, radon can be mitigated and minimalized below the threshold of the Environmental Protection Agency recommendation for acceptable radon levels in a home and as such, radon  should not cause a sale transaction to fail if the parties reasonably agree on the necessary mitigation.

Asbestos may also be found in the fibers of building materials in older homes. If left unchecked, it is a substance that may cause cancer and lung problems. It is typically best to leave asbestos untouched and avoid areas where it may be found and have a qualified professional environmental inspector evaluate to determine the acceptable mitigation, which may include removal.

Structural Issues:

Structural areas in a home can have a range in level of seriousness.  Among structural issues are water in the crawlspace or leaks in plumbing. Naturally, this impacts the functionability of various aspects of the home, as well as the potential for more serious structural damage. Also consider cracks in the home, any cracks in stucco or siding, and any foundation issues as those may be indicative of a more serious problem. Roof issues tend to top home inspection lists, as well, as they can cause leaks, and in our area, ice dams can be an issue. Termite damage is not common in this area, but if it exists it can impact the structural integrity of a home and should be fixed. Other heating, plumbing, and electrical issues should all be taken into consideration. Overall, structural damages to a home should be weighed for both the impact to the home and cost in repairs. Structural issues will usually be addressed in an inspection objection.

Minor Issues:

A home inspection may also yield more minor issues to fix. Cracked windows, torn carpet, a broken garage door, faulty gutters, warped paint, scratched surfaces, etc., may all occur in the home inspection report. Typically, these issues are easier to fix, although a cost still exists. Buyers and sellers negotiate these areas prior to the sale of the home.

Summary:

Home inspections shed light on important factors to know prior to purchasing a home. Buyers should take the inspection process very seriously, and rely on the expertise of their home inspector to guide them through the varying levels of importance discovered in an inspection. Sellers should be aware of these inspection items, and are well advised to discover and to fix items before they become an issue during the sale process.  Routine maintenance may alleviate some of these areas for a smoother inspection process, and we still recommend pre-inspections for homes more than a few years old.  For the benefit of one of our builder friends, note that home inspectors are not required to have certifications, so you should choose an inspector based on recommendations and experience.          

See below for additional information and resources on inspection health hazards.

http://www.cdc.gov/mold/faqs.htm

http://www2.epa.gov/asbestos/learn-about-asbestos#asbestos

http://www.epa.gov/radon/pubs/hmbyguid.html

http://realtormag.realtor.org/tool-kit/closing/article/10-most-common-home-inspection-problems