Buyer Due Diligence When Purchasing a Home in Arizona
Buying a home can be a daunting and stressful undertaking, whether you’ve lived here for years or are relocating from another state. Performing a thorough due diligence is critical and entails more than just a home inspection. It also includes an understanding of the surrounding area, the neighborhood, the HOA and the CC&R’s, soil conditions, crime reports, etc. In order to assist buyers , the Arizona Department of Real Estate and Association of Realtors have published a Buyer Advisory as a supplemental tool for buyers.
Assisting buyers with a home purchase
Realtors are required to provide a copy of the Buyer Advisory no later than the beginning of the inspection period. The advisory covers documents that will be used, physical conditions of the property, and factors about the surrounding area.
Documents Used In The Transaction
Forms that will be used in the transaction are numerous. One of the most important is the purchase contract which establishes the price, close of escrow date, inspection period duration, contingencies, closing cost assistance, etc. Then come the addendums such as the HOA/Planned Community Addendum, possibly an As-Is Addendum, wastewater addendum, etc.,etc. Other documents will include the Seller Property Disclosure Statement, Title Report, CC&R’s, inspection report and others.
Physical Conditions of the Property
One condition that varies depending on the city will be the degree of expansive soil that exists in an area. This is the reason many builders have been using post tension slabs. To identify the areas that have expansive soil, click on Soil Shrink Swell Potential Map.
The square footage is typically taken from the county tax assessor records, and most of the time it is correct. However there are cases when it is incorrect. If it does not seem right, make sure and measure it during the inspection period.
Factors About The Surrounding Area
Factors that may not be specific to the house but affect the desirability of the area could include future Transportation Projects or highways in the area. Another link provided in the Buyer Advisory is a link to sex offenders.
Due Diligence for Waterfront Property
When you’re considering the purchase of a waterfront property, there are additional factors that must be considered. One of them may be does this lake allow boating? Another one would be understanding the source of the lake water . For those who may be interested in fishing, make sure and talk to the HOA and even more importantly, the company that the HOA uses to maintain the lake. That company will have the most detailed information.
The Best Advice In The Buyer Advisory
I believe the best advice in the Buyer Advisory is at the end of the document. On page 9, it recommends; “Talk to the Neighbors Neighbors can provide a wealth of information. Buyers should always talk to the surrounding residents about the neighborhood and the history of the property the buyer is considering for purchase.” You’ll have to live next to them so you might as find out if you can get along with them!
The above are a fraction of the factors that the Buyer Advisory recommends a buyer to investigate. Review the entire document and ask your Realtor any questions you may have.
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