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Realtynovice
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Realtynovice answered:
It's been my experience, based on statements by contractors, realtors, appraisers and legal interpretation of building restrictions (unless other specific language specifies otherwise) that a home (buldings square footage is that of the outside circumferance all above-grade floors of the building less the square footage of the garage and any unfinished areas . My experience has been that some (way too many) realtors commonly use finished footage that is below grade (basement) which should not be included (I have yet to find a definitive answer whether it is acceptable to add "basement" square footage in a finished walk-out that is technically not below grade. So although there is a "generally accepted" definition of what constitutes accepted square footage calculation; there is a lot of fudge room in what should be included as there seems to be some argument of what spaces get included or excluded.
Having had a few months to reflect on this I would have to say errors in square footage is more than excusable puffery and as I said before it could be actionable, but it's a pain to persue legally and the "reward"can be minimal. (please review the caveats in my previous post)
For those buyers for whom exact square footage is important, I would suggest you invest in a $30 laser measuring tool.
Having had a few months to reflect on this I would have to say errors in square footage is more than excusable puffery and as I said before it could be actionable, but it's a pain to persue legally and the "reward"can be minimal. (please review the caveats in my previous post)
For those buyers for whom exact square footage is important, I would suggest you invest in a $30 laser measuring tool.
Michael,
The reason I asked about "material" is to see if this was a specific term of action available in your jurisdiction. If so I am unfamiliar with it.
"Material" in contract law is one that is substantial and important. As you can appreciate, these are subjective terms and the outcome of a claim would depend on all of the facts and circumstances attendant to the transaction.
The common actions in contract law are "neglegent misrepresentation" and "fraudulent misrepresentation."
To prevail on either one there are certain elements that must exist or be proven.
Negligent has fewer elements to prove and they are less stringent (easier to meet.)
The big difference between the two is in the remedy available. Basically, Fraud=$.
The big problem is that in many jurisdictions "caveat emptor is applicable to real estate transactions relative to conditions open to observation. Accordingly, in cases where a condition is discoverable and the purchaser has an unhampered opportunity to investigate but fails to do so, he has no cause of action for misrepresentations or misstatements by a vendor, unless the vendor's actions or omissions amount to fraud," and fraud is hard to proove.
As you have not closed, but are under contract, I suggest you stop and take inventory of your situation. Talk to an attorney as you may have a good case to break the contract and walk away. But is that what you want? An attorney could advise you as to whether you have a stonger case that would alow you to do some arm twisting and get a better deal, or if all you have is the right to break the contract and either renogotiate or walk, or that you are stuck. As I said this is a subjective area and an attorney is unlikely to be able to give you no more than what your chances are at prevailing (no guarantees) and what legal costs are likely to be incurred to pursue your chosen remedy. The hard choice will be yours.
The reason I asked about "material" is to see if this was a specific term of action available in your jurisdiction. If so I am unfamiliar with it.
"Material" in contract law is one that is substantial and important. As you can appreciate, these are subjective terms and the outcome of a claim would depend on all of the facts and circumstances attendant to the transaction.
The common actions in contract law are "neglegent misrepresentation" and "fraudulent misrepresentation."
To prevail on either one there are certain elements that must exist or be proven.
Negligent has fewer elements to prove and they are less stringent (easier to meet.)
The big difference between the two is in the remedy available. Basically, Fraud=$.
The big problem is that in many jurisdictions "caveat emptor is applicable to real estate transactions relative to conditions open to observation. Accordingly, in cases where a condition is discoverable and the purchaser has an unhampered opportunity to investigate but fails to do so, he has no cause of action for misrepresentations or misstatements by a vendor, unless the vendor's actions or omissions amount to fraud," and fraud is hard to proove.
As you have not closed, but are under contract, I suggest you stop and take inventory of your situation. Talk to an attorney as you may have a good case to break the contract and walk away. But is that what you want? An attorney could advise you as to whether you have a stonger case that would alow you to do some arm twisting and get a better deal, or if all you have is the right to break the contract and either renogotiate or walk, or that you are stuck. As I said this is a subjective area and an attorney is unlikely to be able to give you no more than what your chances are at prevailing (no guarantees) and what legal costs are likely to be incurred to pursue your chosen remedy. The hard choice will be yours.
Michael,
Did you walk the house?
You refer to this as a "material" misrepresentation. Why do you use this term? As that is important to any remedy that might be available.
Did you walk the house?
You refer to this as a "material" misrepresentation. Why do you use this term? As that is important to any remedy that might be available.
Realtynovice answered:
Bumping this one too as nearly a year has passed. Kind of fun to see what advice turned out good and what didn't. Some of you ought to go to Vegas and make a killing and others.... oh, well.
1sttimer, the point of my answer was to give you a logical price point, based on verifiable data, to determine what the price of a home would be had the idiotic exhuberance of 2000-2007 not occured.
Use the formula in my prior answer if you want to know what the home would have been approximately worth had all not lost their heads for 7 years. Of course there have been unusual deviations at times (some up, some down- but none like 2003-2007) but over the long run, past history shows reliable, consistent, average trends. Any valuation based on what has happened between 2004 and 2007 is wishful thinking if not just plain foolish.
Use the formula in my prior answer if you want to know what the home would have been approximately worth had all not lost their heads for 7 years. Of course there have been unusual deviations at times (some up, some down- but none like 2003-2007) but over the long run, past history shows reliable, consistent, average trends. Any valuation based on what has happened between 2004 and 2007 is wishful thinking if not just plain foolish.
There are just too many variables for your question to be answered to any degree of certainty, unless hand grenade accuracy will suffice.
After asking yourself "Is it what I want, where I want it, and can I comfortably aford it?", the next question everyone wants to know the answer to is "If i want/need to sell it, will I at least break even?"
So: Are you buying the highest priced home in a decling neighborhood? Are you buying a 6000sq foot McMansion which no one will want if fuel heating costs skyrocket? Are you buying a home in a middle manager's price range at which there will be future buyers? - or will that local company at which all the middle management types work move or go belly-up and take all your potential buyers with it (to say nothing of all the homes those displace middle managers are going to put on the market.)
Unless you're extremely fortuitous, you are going to be down 6% right off the bat. Whoever sold you the home, sold it at what you and they considered a "fair price" plus realtor commision. To break even, you need to sell it at a price 6% greater so you can get what you paid plus pay your realtor. You're in the hole as soon as you buy.
Enff of my Bull. The advice I give to those who have asked me is: nationally the historic appreciation for homes has been 3 1/2 to 5%. The government has this data for nealy all metro areas going back to the early 80's on a year by year basis. Find this data for the metro area in which you wish to buy (its on the internet). Average the annual percentage appreciation from as early a date as the data is available up to the year real estate in your metro went nuts---its imposible to miss--somewhere.about 1999 to 2002. Next: research the prior selling price of the home you want to by if it sold prior to the big bang. If your desired home is new const. or has no sale prior to the big bang then get the selling price for a couple of comparibles (use the auditor's site for your metro). Now take that prior selling price (remember it must have been prior to the big bang) and compound it by the average appreciation percentage you calculated for each year from that prior selling date untill the present. That is the value the house should historically have had if it had not been for the big bang AND is the price I would recommend. (remember I said "I"-check my handle)
Good luck.
After asking yourself "Is it what I want, where I want it, and can I comfortably aford it?", the next question everyone wants to know the answer to is "If i want/need to sell it, will I at least break even?"
So: Are you buying the highest priced home in a decling neighborhood? Are you buying a 6000sq foot McMansion which no one will want if fuel heating costs skyrocket? Are you buying a home in a middle manager's price range at which there will be future buyers? - or will that local company at which all the middle management types work move or go belly-up and take all your potential buyers with it (to say nothing of all the homes those displace middle managers are going to put on the market.)
Unless you're extremely fortuitous, you are going to be down 6% right off the bat. Whoever sold you the home, sold it at what you and they considered a "fair price" plus realtor commision. To break even, you need to sell it at a price 6% greater so you can get what you paid plus pay your realtor. You're in the hole as soon as you buy.
Enff of my Bull. The advice I give to those who have asked me is: nationally the historic appreciation for homes has been 3 1/2 to 5%. The government has this data for nealy all metro areas going back to the early 80's on a year by year basis. Find this data for the metro area in which you wish to buy (its on the internet). Average the annual percentage appreciation from as early a date as the data is available up to the year real estate in your metro went nuts---its imposible to miss--somewhere.about 1999 to 2002. Next: research the prior selling price of the home you want to by if it sold prior to the big bang. If your desired home is new const. or has no sale prior to the big bang then get the selling price for a couple of comparibles (use the auditor's site for your metro). Now take that prior selling price (remember it must have been prior to the big bang) and compound it by the average appreciation percentage you calculated for each year from that prior selling date untill the present. That is the value the house should historically have had if it had not been for the big bang AND is the price I would recommend. (remember I said "I"-check my handle)
Good luck.
Realtynovice answered:
Thought I would bump this as it is now nearly a year later. Any new insights or retrations?
The better question is "Why in the world was ANYONE (in their right mid) buyin from 2004 thru mid 2007?
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