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Buyer Protection in a Hot Market


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Over the past few years, the Nantucket real estate market has been hot, and many sellers have been unwilling to accept contingencies as part of a transaction. This fast-paced and complicated market has put the onus on buyers to understand their risks and ensure they are asking the right questions before submitting an offer. Read on to learn more about working closely with your broker to understand the intricacies of your purchase so that you can ensure your ability to modify, change, or expand a prospective property as desired.

Protect yourself when buying

All real estate transactions are different, and the Nantucket market can be complicated and unique. Below are a few things to think about for your next purchase.

Investigate what is around you:

Always ask about the abutting properties, especially if there is vacant land. Depending on ownership, expectations can vary greatly.  For example, if a property abuts town-owned land, the guarantees are not the same as if a property were to border conservation land.  Town-owned land can be sold or developed, and while it is of low likelihood, it is good to be aware of the possibilities.  A call or trip to the Nantucket Planning Office to get an idea of how the Town is currently using the property or if there are plans for the property’s future would be a great place to start.  Alternatively, land owned by Nantucket Land Bank or other conservation organizations is unlikely to undergo drastic changes, if any.  While rare, Land Bank and other organizations can trade property, but it requires a significant approval process or a lack of conservation deed restriction, respectively.

Finally, if the vacant land that abuts a property you are interested in is privately owned, do not assume that the land will remain that way, even if someone has assured you otherwise.  So long as there are no deed restrictions or other stipulations in place, a privately owned property can sell or change hands at any moment, and the word of the previous owners would no longer stand.

Add the appropriate contingencies to your deal:

Some deals are more complicated than others, but no matter what, you want to think through all aspects of a deal and what contingencies make sense to include in an offer.  The real estate market has been hot over the past few years, to say the least, and it has indeed been a seller’s market.  Given this dynamic, sellers often have not been accepting many contingencies, if any at all.   If this is the case, it is ideal to talk to an attorney and engineer to get a true sense of what you could be up against in executing your vision and understand any risks you might be undertaking.

When it comes to new construction and significant renovations, it is awesome when there can be transparency and agreement among neighbors. However, there are times when a neighbor might object to your plans, with the worst-case scenario being that your projects get tied up in court or, more likely, before a local board.  Your neighbor could appear at meetings or send an attorney on their behalf to voice their concerns.  Depending on the risk level of your purchase, you should discuss if it makes sense to include any approval contingencies and keep in mind any appeals period. As an example, the Historic District Commission has a ten-business-day appeal period.

Another possibility to be mindful of is the Massachusetts Endangered Species Act or MESA. MESA exists to protect endangered plants and animals within our state.  Thanks in part to MESA, there are portions of the island that are considered natural resource protection areas.  Building or making changes to a property that falls within one of these areas would require you to hire an engineer to complete a study for submission to the state to determine if any endangered species are present. Whether or not an endangered species is found could significantly impact what you can or cannot do on the property.  If the property you are interested in purchasing falls within this zone, you might consider a MESA contingency, which can take 30 – 60 days or longer. 

While these are just a few of the significant possibilities, each property is different and may have more than or less than the above to consider. Therefore, you will want to work closely with your agent/broker to discuss potential risks and which contingencies to consider beyond the basics when considering your purchase.