Open house agent interview sheet: a checklist of pertinent questions to ask the listing agent about a property to gain an understanding of the price to offer
This article analyzes the selling agent’s use of the Open house agent interview sheet to obtain an aggregate synopsis of a listed property’s condition and attributes to best inform him and his buyer of the property’s value before setting a price and submitting an offer to purchase.
As all real estate professionals well know, timing is everything. And few things in the real estate industry are as time-sensitive as the delivery of property disclosures and relevant property information to prospective buyers and their selling agents. For every party in any real estate related transaction to succeed in their own capacity, it is critical that all data and information about a property cannot be limited in its quality, quantity and timing of release by the seller’s listing agent.
A flood of property information is not a hazard in the real estate industry; it is the beneficial antithesis of stark, reluctant releases of information to interested buyers, a manifestation of the seller and listing agent arrogance which rose to predominance during the Millennium Boom. Reluctance to disclose information upfront is a risk inconsistent with all the current and long-term aspirations of an agent providing real estate services as it interferes with closing and invites litigation by introducing untimely surprises immediately before closing. [For new case law on the timing of the delivery of disclosures in the new real estate paradigm, see the October 2010 first tuesday recent case decision, Holmes v. Summer (October 6, 2010) CA4th_.]
A selling agent and buyer should not need to twist the arm of a secretive and aloof (lazy) listing agent to disseminate information on conditions affecting the property already known or readily available to the listing agent. It is in the interest of all parties, including the listing agent, to avoid the dilatory disclosure of material information since hoarding property information is counterproductive, wrong and a violation of listing agents’ general duties owed to prospective buyers to voluntarily provide property data. It is also contrary to law: all property-related disclosures are to be delivered to the buyer as soon as practicable – as soon as possible (ASAP) – after commencement of negotiations and before entering into a binding contract – pre-acceptance. [Calif. Civil Code §§2079 et seq.; Calif. Attorney General Opinion 01-406 (August 24, 2001)]
All this begs the question: what is the best way for a selling agent and his buyer to quickly gather information about a property from listing agents during the early stages of their search. Without information on the merits and defects of a property, the selling agent and buyer have insufficient basis for determining the relative value of a property, and ultimately, the price to be offered for it?
The Open house agent interview sheet functions as a quick-fact checklist of material information concerning a property listed for sale and the circumstances surrounding it, such as its location, financing and, if available for asking, the seller’s motivation for selling. [See first tuesday Form 320-2 below]
Editor’s note – All first tuesday forms may be accessed by currently enrolled first tuesday students within their Student Homepage. first tuesday forms are enabled for digital fill, print and save. Log in with your DRE license number and click “first tuesday Forms Download and Updates.”
The Open house agent interview sheet is to be used by selling agents when contacting listing agents regarding a listing or attending open houses on their own or with their prospective buyers. The form covers property related information, including material facts, the listing agent knows or should already know and have available in his marketing package handed to prospective buyers, all this when negotiations begin (in the process Holmes-proofing himself by timely delivery) – not after negotiations have ended with the seller’s acceptance of the buyer’s offer. [Jue v. Simser (1994) 23 CA4th 312]
The interview sheet it structured as a series of questions to be asked of the listing agent. Armed with this knowledge, the selling agent and buyer can obtain a preliminary understanding of the value of the property, information that will necessarily factor into the buyer’s decision regarding whether or not to submit an offer, and if so, on what terms.
The Open house agent interview sheet contains probing questions for the listing agent designed to elicit concrete responses from the seller’s listing agent relating to the:
- seller/owner/occupant, such as personal information available about:
- their reason for selling [See Form 320-2 §1.1];
- when the seller is vacating the property [See Form 320-2 §1.3]; and
- whether the seller is ensnared in any litigation. [See Form 320-2 §1.9]
- property, such as:
- the age of the property [See Form 320-2 §2.2];
- property specifications, such as its square footage, lot size and its number of bedrooms and bathrooms [See Form 320-2 §2.3];
- whether the mandated disclosures, such as the Natural Hazard Disclosure (NHD) and Transfer Disclosure Statement (TDS), are available as part of the listing agent’s marketing package for the selling agent’s and buyer’s immediate review [See Form 320-2 §§2.10, 2.11]; and
- whether crime exists around the property which negative affects its value.
- location of the property and features of the surrounding area, such as:
- a description of the property’s neighborhood [See Form 320-2 §3.1];
- area amenities, such as schools, banks and shopping opportunities [See Form 320-2 §3.5]; and
- the number of homes in the neighborhood of equal, lesser and greater value. [See Form 320-2 §§3.6-3.8]
- third parties who have knowledge of the property, such as:
- whether prior purchase offers have been submitted, and if so, at what price [Form 320-2 §4.1]; and
- the impressions of other individuals who have viewed the property, such as neighbors and other agents. [See Form 320-2 §§4.2-4.3]
- terms of sale, such as:
- the listing price and whether it was reduced, and if so, when [See Form 320-2 §5.1];
- the sale price expected by the seller, the approximate fair market value (FMV) of the property, and the price the seller initially paid for the property [See Form 320-2 §5.2]; and
- what existing financing encumbers the property, and whether the seller would agree to carryback a portion of the purchase price. [See Form 320-2 §5.3]; and
- miscellaneous information that will assist the selling agent and buyer determine the property’s value, such as:
- whether a tenant currently occupies the property, and if so, on what terms [See Form 320-2 §6.1]; and
- the name of the listing agent and open house agent. [See Form 320-2 §6.2]
Much of this information will also be covered in the reports and mandatory disclosures presented to the selling agent and his buyer early in the discussions about a property (read: when negotiations begin and before submitting an offer to the seller), disclosure documents such as the NHD, TDS, home inspection report (HIR), property profile, neighborhood security report, ownership expenses and termite inspection report. However, the Open house agent interview sheet functions as a quick-reference guide, compiling all this advantageous or adverse property information into a single document for easy review by the selling agent and buyer.
Editor’s note – The selling agent and buyer may rely on the listing agent’s disclosures (and silence) without confirming their accuracy, completeness or consequences before the buyer submits his offer to the seller. However, after the seller accepts the buyer’s offer, the selling agent is to conduct his own due diligence investigation of the property to verify the information (or lack of information – silence) provided by the listing agent.