Hurricane Damage Impact on Pending Home Sales in Apopka Florida
Every year, Florida is at risk for one or more hurricanes. If you are in the process of selling or buying a home when a big storm hits, you may wonder about the hurricane damage impact on pending home sales in Apopka Florida. This information may help.
Buyer Access to Damaged Properties
It’s very common for buyers to request a showing immediately after a hurricane in order to survey the damage. Section 18(L) of the real estate contract allows for such showings, with reasonable notice to the seller. Understandably, buyers are just as concerned about damages as sellers are. The amount of damages will be important to the contract, which we cover in more detail below.
Extension of Deadlines Under Force Majeure
Section 18(G) of the Florida real estate contract covers major disasters such as hurricanes. It allows deadlines within the contract to be extended. However, it also allows either party to terminate the contract if closing delays exceed 30 days from the date noted in the contract. Notice of termination must be submitted in writing. Terminated contracts can be the biggest hurricane damage impact on pending home sales in Apopka Florida.
Amount of Damages and Repairs
The amount of hurricane damage to a home can also be important. Section 18(M) of the real estate contract covers casualty damages to a home before closing. Here’s what buyers and sellers should know.
The 1.5% Mark
Damages amounting to less than 1.5% of the purchase price are handled differently than those exceeding that amount. Buyers have the option to terminate the contract when damages exceed that threshold. Under the threshold, sellers are responsible for completing repairs before closing.
Repairs Before Closing
There are some cases where repairs are not completed in time for closing. There are three potential outcomes when this occurs:
- Escrow Funds - Funds from the seller can be placed into an escrow account to cover the repairs. 125% of the repair costs are escrowed, just for added security. Payment for the repairs will come from those escrowed funds, and anything remaining will be returned to the seller.
- Buyer Accepts Funds – The buyer may accept funds from the seller for 1.5% of the purchase price. Repairs become the responsibility of the buyer. Should repairs cost less than 1.5%, the buyer keeps anything remaining.
- Terminate Contract – The buyer may opt to terminate the contract.
Summary of Hurricane Damage Impact on Pending Home Sales in Apopka Florida
As you can see from above, hurricane damage impact on pending home sales in Apopka Florida can be minor or major, depending on the extent of damage and possible delays. Minor damages may be resolved quickly and create little or no delay in closing. Major damages could delay closing dates or even result in termination of the contract. If terminated per the provisions above, any deposits are returned to the buyer without further obligation or recourse.
The important thing for Florida buyers and sellers to remember is that hurricanes are unexpected and impact both parties. If both parties wish to continue with the sale, that’s wonderful. However, there are some cases where this is more difficult to accomplish due to timing and cost. Proceeding with understanding and patience can go a long way in helping everyone through the difficult situation.