Buying or Selling a Home/zoning contingency

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Expert: John Hendricks - 9/3/2008


Question
I have been offered,by a college, my asking price for my residential/farm property contingent to a rezoning approval for a college building. This rezoning may take considerable time. Is it common to ask for additional money in return for the contingency? Can I also ask for additional money if the approval process is delayed beyond a reasonable time?  Should I be represented by an attorney as well as my real estate agent during all the negotiations?

Answer
Dear Sheila;

Thank you for your questions.

There is a contract provided by the California Association of Realtors (CAR) that is called an "Option Agreement" Form 'OA' for such a transaction.

To answer your first two questions, everything is negotiable in a real estate transaction. Your assumption is correct in negotiating an amount of option money that would reflect the time period of the option to purchase your property and it is non-refundable. Normally if the option to purchase was exercised, the option money would be applied to the down payment. If they do not exercise their option to purchase within the time frame set in the option agreement, then they could resubmit an extension prior to the expiration of the original option agreement. The extension would include another offer of payment of option money that also would not be refundable. This option money payment again could be applied with the first option money payment if everyone was in agreement.

Be aware though, if you enter into this option agreement, you can’t sell to any other party during the duration of the agreement, so make sure that this arrangement meets your current and future needs.

The last question you had was regarding representation. You can be assured that the college will be represented by council, either a Realtor or attorney. Their interest would be on behalf of their client (the college) only, not you. If that is the case, yes employ an attorney to review all documentation prior to your approval. You may consider having the attorney negotiate the transaction for you to eliminate the emotional aspect from occurring.

I hope this helped in answering your questions… Good Luck!

Warmest Regards;
John Hendricks  

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John Hendricks

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As a California Realtor for 23 years practicing in Marin and Sonoma Counties, it is now time to provide counsel through AllExperts.com to those who need advise in real estate. My knowledge and experience includes a wide range of resale residential real estate purchases, new home sales, income related investment properties involved in 1031 exchanges, and land. Let me help you in any of these areas...

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John Hendricks has established himself as one of Marin & Sonoma Counties premier Realtors. A native Californian, John is a well-known and respected Realtor in both Marin & Sonoma Counties who has resided in the Northbay since 1976. John began his real estate career in 1986, and since then has distinguished himself as one or Northern California's top producing Realtors. Before joining Frank Howard Allen Realtors, John was an associate of the Prudential California Realty from 1990-1992 where his outstanding sales achievements earned him one of the company's highest honors, the prestigious "President's Circle Membership", presented to the top 2% of associates for sales and earning excellence. Since his association with the highly regarded Frank Howard Allen Realtors in 1992, John has once again established himself as one of his company's Top 10 Producing Realtors in Marin & Sonoma Counties for the years 1993 through 2007 and now in 2008. Five continuous years of outstanding performance has now allowed John to join 15 other Realtors in the prestigious "Lifetime Hall of Fame" for Frank Howard Allen Realtors. John established a group of professional individuals who specialize in a variety of areas in real estate called, 'Lundmark-Hendricks Fine Homes' This group of professionals are dedicated to the success of representing clients with the greatest amount of care and service when either buying or selling real estate.

Organizations
California Association of Realtors National Association of Realtors

Education/Credentials
Upon Request...

Awards and Honors
Frank Howard Allen Realtors "Hall of Fame Member" Chairman's Circle for 10 consecutive years

Past/Present Clients
Joe Louis & Sharon Sigurdson We want to thank you again for your excellent representation of interests during the recent purchase of our home in Petaluma as well as the sell of our home in Mill Valley. We had the unusual pleasure of working with you during the last year both as sellers and buyers. We felt that our interests were always paramount and that we received a very fair price for the sale of the Mill Valley house as well as our purchase of our new home. This speaks particularly well of you, because of the recent unstable and chaotic real estate market. Will Finke "Quite frankly, we came out of a very difficult situation, which time does not allow elaborating on. This was one of the greatest experiences of our lives as clients. John Hendricks is one of the top businessmen I have ever met." Bruce & Nancy Rosentreter "I chose John Hendricks to sell my house. I picked him because I thought he was professional, aggressive, and that he could get top dollar for my house. He fulfilled my expectations completely." Joy Schuelke "Since we were trying to sell a high end home in a very tough market, and in the middle of a very rainy winter, the prospects seemed quite bleak. I was convinced at the time, and am even more so now, that without John's tenure, patience, and tenacity, we would have not been able to move the property." Lynn McCarthy "I cannot stress strongly enough how impressed I was with the service provided to me by John and his group. Throughout the entire transaction, John was always available, always forthcoming with excellent advice based on his years of experience, and always willing to put in the extra effort to make this a positive experience for me. I feel lucky to have had the experience of working with him." Lea Lieurance-Turk "Thank you John for your outstanding real estate services for the past 5 years I have known you. You have made my dreams come true as far as selling and buying property."
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