Are Agents Required to do an Agent Visual Inspection Disclosure (AVID)?

There is a lot of confusion around filling out the cumbersome Agent Visual Inspection Disclosure (AVID) form. California Civil Code 2079 requires that an agent must conduct a reasonable competent and diligent visual inspection of real property in order to disclose to the prospective buyer and material facts affecting the property’s value, desirability, and intended use. Agents do not have to inspect:

  • Areas not reasonably accessible; 
  • Areas off the site of the property; 
  • Public records or permits concerning the title or use of the property; or 
  • The common area if the property is in a common interest development 

Since we know that California law requires agents to performs a visual inspection, we will determine what document to use.

First let’s establish what is a “material fact” from other facts, since that is what we agents are expected to disclose.

An online legal resource defines material fact as: A fact that would be important to a reasonable person in deciding whether to engage or not to engage in a particular transaction. Based on this definition, many cosmetic issues, like scratches on wood, for example, would not need to be mentioned. In fact, what if there are no material facts to disclosure? Do agents still have to do a disclosure? The answer is yes.

The good news is that there is a place in the transfer disclosure statement (TDS) Sections III and IV for agents to fulfill disclosure duties.

If there are more material facts to disclose then an AVID form can be used to give a more comprehensive account of the inspection.

If you don’t have access to an AVID form then you can you use a substitute form.

In no case should an agent leave the visual inspection section of a transfer disclosure statement empty and not do any other form. If this happens, and a buyer is adversely affected by a material fact that was missed by the agent then that buyer may pursue the agent for negligence.

 

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Do Real Estate Agents Need an Office?

The question arises from agents, “do you have an office?” This is an important question because a big difference between many tradiitonal brokerages and 100% commission brokerages is access to an office. In order to answer, it’s only fair that we give some background information. When proespective agents would call or visit the office to inquire about Balboa Real Estate, the answer to the question whether there was an office to use was an unequivocable “yes!”  Agents were mostly concerned if a prospective client wants to meet then where could they host a meeting. For years, our company had professionals offices and a conference room with company signage and nice furnture, basically everything that an agent would need in a professional office. All this was set up for our agent and then….nothing. By nothing I mean agents never used the office. I shoudn’t say never, because once every 3 or 4 months the conference room was used and maybe an agent would use an auxiliary computer to print something on occasion.

We realized that agents meet sellers at their home, the home the agent would list. Agents would meet buyers at the properties they were interetested in viewing. If an agent needed to to talk to a client somewhere other than the propsective listing or purchase properties, they would meet at the most close and convenient coffee shop. I was told there was no reason for an agent and their client to drive several miles out of their way to meet at an arbitrary location.

When agents need to create a listing agreement it is created online, then either sent through Docusign or a PDF is emailed. The client will sign online or print/sign/scan back to the agent. The same process is used for purchases. It seemed that since the paperwork was done online, there was no point in going to an office to print and fill out paperwork. The concept of the office has changed drastically. At this time our office had over 100 agents, did hundreds of transactions a year, yet the office was always quiet with very few visitors.

As most real estate tools are web-based, and agents can easily have a printer and scanner at home to use as needed, there is no reason to go into the office. In fact, a case can be made that it is less time effcient to run to the office for a few tasks, than to do then from your home office. It’s also inconvenient to request your clients to drive over to your office for paperwork or a discussion. Clients are better served at the home they are listing or interested in buying.

There is one last factor to consider, and that is commission. If an agent doesn’t need a brick-and-mortar office to consistenly go to, then they will keep more commission. 100% commission real estate companies that have limited office recources for agents allow agents to keep far more of their commission than tradition companies. If an agent can save thousands of dollars on a transaction at a 100% brokerage, then is it worth it to invest some of this money in home office? We say yes.

If you are interested in finding out what Balboa Real Estate has to offer. please CLICK HERE

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