I'm sure we're not unique in our real estate business - strange situations can arise just about anywhere - it just seems that some times we have nothing but "interesting" situations!
One such interesting sale was just closed this past week. It was truly a beautiful home, almost 5,000 square feet and only a few years old. Unlike similar homes closer in to DC in Montgomery County which would have gone well over $1 Million, because this is in a different county and not really in commuting distance, the home sold for under $500,000 - quite a buy! The family who purchased the house were thrilled - they had done their homework, searched for six months or more and found everything they wanted in this home, or so they thought.
One week before closing, as we were contacting utility companies to make the change for our client, we ran into a problem. The gas company couldn't find any records of the property address. Ok, we thought, maybe we have the wrong gas company. So, we contacted the listing agent (the buyer was our client), and asked for the name of the gas company. They contacted the seller and got us the information - only problem was it was not a "natural gas" company, it was a propane company. Our buyer was, understandably, upset. They hadn't seen any propane tank, they had been told (and it was in the listing paperwork) that the house was natural gas, and in fact, natural gas was one of their big criteria!
After calls to the propane company, we discovered that there was no tank on the property, the development had a large holding tank, then the propane was delivered via underground pipes to the individual homes which were all on meters. We got copies of the propane bills for the past year to compare them to natural gas - they were higher to the tune of double or more! The selling agent was at a loss, she had not idea the home was propane and in fact, on looking at other listings - active, sold and under contract in the same development - about half the listings showed the homes were natural gas!
So, here we were, days from closing and as our clients really loved the house, we decided to go back to the seller with an addendum to the contract which, in essence, asked for a credit to cover the increased and unexpected costs and reserved the right to cancel the contract and retrieve our earnest money deposit if an accommodation could not be reached on the grounds of misrepresentation.
We asked for, and received, a $5,000 credit from the sellers - enough to cover the increased costs for a several years and the deal went to closing.
The lesson hear is that there would have been no credit had the heat, cooking and hot water fuel been listed as "other" and the propane delivery system (pretty much the same as regular natural gas) explained. I believe our clients would have still purchased the house had they known in advance. You might wonder how to find fault with the listing agent, her client told her the heat and hot water were "gas" - but if the agent specializes in that area she would know (certainly should know) and if she doesn't, she needs to become familiar with the area, similar homes, etc.
It is quite possible that had the closing taken place and the buyer discovered the situation after the fact, there may have been the basis of a suit against both the seller and the real estate agent!
So, do yourself a favor (as always), go over listing paperwork carefully - go over the MLS listing carefully, go over printed brochures carefully. It is up to you to find any mistakes that could be costly in the end.
As Always BE INFORMED and CHECK BACK HERE OFTEN
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