December 22, 2011 at 11:09 am EDT | by Sue Goodhart
Change is in the air

Home buyers should be aware of 2012 changes in Regional Sales Contracts. Most will be well served to have a home inspection contingency in place with their sales contracts.

This year, when we ring in 2012 with a glass of bubbly, we will also be ringing in a new era of how D.C.-area residents buy and sell real estate.

As of the first of the new year, a new Regional Sales Contract will be implemented in D.C., Northern Virginia and Montgomery County, Md., that will have major changes and new implications for the condition of a property when a buyer moves in or a seller moves out.

The contract currently in effect until the end of the year has a paragraph (“paragraph seven”) in which the sellers warrant that they will deliver all plumbing, heating, cooling, electrical equipment, appliances and smoke and heat detectors to the purchaser in proper working order. All other items in the home (such as structural issues, roof, etc.) are sold “as-is.” If the purchaser has a home inspection contingency, they can negotiate for the seller to fix any items not covered under paragraph seven. In order for the contract to move forward, both parties would need to agree on which additional items would be fixed by the seller (again, always assuming that all paragraph seven items would be fixed). Unless agreed upon, the sellers are under no obligation to fix any items not warranted in paragraph seven.

Under the new contract coming down the pike, the old seller’s warranty in paragraph seven is removed and all homes will be sold “as-is” in their entirety. Since sellers are now under no obligation to fix any items, all purchasers will be well served to have a home inspection contingency in place and an experienced realtor to help them negotiate the items to be repaired or replaced.

The purpose of this change was that there were many disputes between purchasers and sellers regarding what items were required to be fixed under paragraph seven. For example, if a 1980s clothes dryer made an extremely loud noise and shook as it dried clothes, but it dried them efficiently, was that proper working order? Many realtors believe that this change will alleviate some of these gray areas of what constitutes working order since all items will now be negotiated.

So what is the bottom line for how these changes will affect buying and selling property in D.C.?

* It is more important than ever for buyers to have a home inspection contingency.

* Both buyers and sellers should use an experienced agent to help them negotiate not only through the sales price of the home, but also through the home inspection contingency to save on costly repairs.

* Sellers must keep in mind that most purchasers will still expect their new home to have the major items in working order. If something is broken before putting your home on the market, it is a good idea to fix it beforehand or at least agree to fix it after the home inspection.

* Purchasers should be more cautious before putting in an offer on a property. Home inspections can be costly so be sure to take a good look around to see if you see any potential problems before going under contract.

If you have any questions about the upcoming changes to the contract, please don’t hesitate to let us know.

Sue Goodhart is the top-producing agent at McEnearney Associates in Alexandria and is licensed in D.C., Maryland and Virginia. She can be reached at 202-507-7800 or


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