Looking Out for My Buyer: A Lesson in Purchasing Rural Property in California

There is a tremendous amount of rather contentious debate about the value (or lack there of) in purchasing Real Estate with a Buyer’s Agent representing you. As a California Real Estate Broker it is obvious where my opinion falls in this debate. Although I do believe there are individuals who are capable of handling the transaction on their own, most individuals DO NOT belong to this group. I’m not here to debate this matter. I’d rather tell you about an example of what it is that a Buyer’s Agent does to protect their Buyer’s best interests; about what it is that I do and what value I bring to the relationship.

A recent client of mine had entered in to a contract to purchase a home on a 3 acre parcel of land in Colfax, CA. The property was an older home and his plan was to remodel it and resell the property in a few years. Our offer was accepted and we were working our way through the Contingency Period. During this period it is the Buyer’s responsibility to do his or her due diligence to make sure they know the condition of the home they are about to purchase. This means it is my responsibility to make sure my client is informed and aware of the results of the various inspections that determine the condition of the property.

One of the last contingencies that had to be cleared was the Domestic Well Inspection. This well inspection tests the property’s well for drinkability and the volume of water it yields. Often rural properties in Placer County are not on sewage or water systems and so septic tanks and leech fields are required to address the waste and well water is required to supply water to the property. If the well doesn’t supply a large enough volume of water, measured in gallons per minute (GPM), it will be very difficult for the well to provide enough water when it is needed by the people living on the property. Generally speaking, anything less than 10 GPM is highly undesirable and would probably require the addition of a storage tank or the drilling of a deeper well.

When I received the Well Inspection Report from the Listing Agent I noticed that the first page was missing. The first page is the page that contains the results of the GPM test. So I contacted the Agent and asked for it. She told me that she had sent it. I informed her that I did not receive it and that she needed to resend it, she eventually did. When I saw the report’s results I was shocked. The inspection results measured the well’s yield at 1.6 GPM. This is well below (no pun intended) the 10 GPM needed to supply water to the Colfax property on demand. Even if the Listing Agent and Owner had no idea the GPM would measure so low, it should have been brought to our attention as soon as the report was received. Instead, they tried to sneak the report past me and my buyer.

Anyone who knows anything about buying and selling rural properties knows that 1.6 gallons per minute would create a very difficult and uncomfortable living situation for my client and his family of five. Costly and time consuming work would need to be done to the property in order to remedy the situation. And even that is shaky at best, as there’s no guarantee that drilling the well deeper would necessarily improve its performance. This meant the Placer County property was no longer as valuable as we had thought and it certainly looked like the Agent had done everything possible to prevent us from discovering this detriment. Needless to say my client and I were terribly unhappy with the deception and we canceled the contract within hours of reading the report.

Yes, it is entirely possible that Randy, my buyer, could have noticed this discrepancy himself. But it’s also possible that with all the changes going on in his life he may have been distracted and missed it. He would’ve ended up purchasing an overpriced property and still have had to spend $20,000 to $40,000 to improve the condition of the well. Or even worse yet, it may have been impossible to improve the performance of the well. The Listing Agent did go out of her way to prevent that information from being seen. That is of course if we are assuming that she didn’t “accidentally” forget to include the ONE page of information that would make the property practically unsellable. But it doesn’t matter if Randy would have noticed their ruse or not because I caught it and we immediately called them to task.

If there’s one thing I’ve learned in Real Estate, and in business in general, it’s that there is always something that can go wrong; that WILL go wrong. Staying alert and always looking out for your interests, being prepared for those problems that will arise, and knowing how to fix them; this is what I do. When I am representing you I am looking out for your best interests in your California Real Estate transaction, just like a lawyer looks out for his client’s best interests in court. And you know what they say about someone who represents themselves in a court of law.

I am very well informed concerning purchasing properties that have wells, and I was pleasantly surprised that Mary and her team were as well informed as I was. I am interested in protecting my own interest, but, in my experience, it is rare to have a team that is fighting for my rights as hard as I do. Thanks Mary and team!
~Randy Bivens, PHA Realty Client