Long Beach Island Real Estate Legal Forms and Types of Representation

Before starting your search in the LBI real estate market, it is important to understand who is working for you. Generally speaking, most homes will be listed for sale by a listing broker, also referred to as a seller's agent, and a buyer's broker will represent a buyer, also referred to as a buyer's agent. Sometimes, both buyer and seller are represented by the same agent, which is called a disclosed dual agency. Dual agency has several limitations associated with representation, as the agent cannot favor one side or the other. When buying a home in the LBI real estate market, it is advisable to work with a buyer's agent who can represent your best interests. A buyer's agent will work for you and you alone to help you find a home and ensure your needs are protected. Below is a detailed breakdown of agency relationships commonly found in the Long Beach Island real estate market.

CIS Form

The Consumer Information Statement or "CIS" form is intended to explain the general nature of our business relationship and inform you of your rights. This form describes the role of each real estate agent, their relationships and responsibilities, and the part of an attorney. NJ Real Estate Law requires that this form be signed before working with an agent. It is important to note that signing this form does not bind you to anything or anyone. Your signature is only an indication that you have received it and that you understand the role of agencies and representation in the LBI real estate market.

Buyer Agency

Buyer agency refers to the relationship between The Van Dyk Group, myself, and my client (you). This particular form of agency refers only to listings that The Van Dyk Group does not represent. When a listing is being represented by an agent of The Van Dyk Group, and I show the property to you, the agency relationship changes to "Dual Disclosed Agency." In short, as your agent, The Van Dyk Group and I have been hired to represent you in a real estate transaction and will act in your best interest.

Seller Agency

Seller agency refers to the agency and the agent representing the seller and their interests. If the same agent represents both the buyer and seller, this is called a "dual agency" on Long Beach Island. A seller's agent will work to get the best price and terms for their client and does not represent a buyer's interests in the LBI real estate market.

Dual Agency

Disclosed Dual Agency occurs when The Van Dyk Group, or any real estate agency in New Jersey, represents both the seller and the buyer. The same agent may represent both buyer and seller, or a different agent of the same office may represent each side of the transaction. In either case, the agency relationship is the same. It is important to understand that in either case, privacy is stressed, and no information will be made known that would put you in an unfavorable standing in the transaction.

 Closing Steps and How a Buyer's Agent Can Help in the LBI Real Estate Market

Home Inspection- A home inspection is highly recommended and is performed by a licensed home inspector. He or She will conduct a thorough examination of the house and point out any safety concerns or issues with the house. A buyer's agent will help with recommendations on trusted inspectors and help you understand the report's findings. A buyer's agent can also coordinate repairs and estimates to give you a complete picture of the report and its meaning. 

Survey and Flood Elevation Certificate-A survey should always be performed before closing. The survey is required for a CO and shows the town that there are no encroachments on adjoining properties. A flood elevation certificate will give you critical information about the home and its risk level for flooding. This document can help with obtaining a flood insurance policy as well. In most cases, the buyer is responsible for providing the survey and the flood elevation certificate. A buyer's agent can help you understand what the survey shows and help you find flood insurance with the elevation certificate. 

Appraisal-If a mortgage is required for the purchase, an appraisal will be ordered by the bank and paid for by the buyer. Some banks require two appraisals for properties over $1,000,000 on LBI. A buyer can strengthen their offer by waiving an appraisal contingency. However, if there is a disparity between the appraised value and the purchase price, the buyer may have to make up the difference out of pocket. Appraisals typically are not an issue as the sales price should be in line with the market. A buyer's agent will work with the buyer to provide comparable sales before the offer is made to ensure the price is correct. If the buyer's agent knows the market, appraisals should not be an issue. 

Certificate of Occupancy (CO)-The town on Long Beach Island, where the home is being sold, will perform a CO inspection and issue the certificate before closing. A CO inspection is not a home inspection but does look for open permits and basic safety requirements. While typically, the CO is obtained by the seller, there are many instances where the buyer is responsible for obtaining the resale CO. When this happens, the buyer's agent will ensure the home is up to code to pass the inspection. This involves basic paperwork and checking things like loose handrails, fire extinguishers, smoke detectors, etc., to ensure they are in working order.

 Walkthrough-This is typically done right before the closing takes place. The intention is to make sure the property is in good condition, any repairs have been completed, and the house is as it was represented. If there are any issues, we will take photos of them and discuss a solution at closing. A good buyer's agent will usually do a pre-walkthrough to make sure there are no last-minute surprises that could hold up closing. By checking things before the final walkthrough, problems can be addressed promptly and ensure a smoother closing. 

Settlement-This is the actual signing of documents and transfer of funds. This can be handled in the buyer's attorney's office or by mail. A buyer's agent plays a surprisingly small role in the actual settlement. Since COVID, many closings are done by mail, and if they are in person, it is usually the closing agent and attorney who attend. That said, the buyer's agent will still be on hand, either in person or by phone, just in case some last-minute surprise occurs!

General Advice-Moving to Long Beach Island can be a very imitating process. There is a lot to understand about the LBI real estate market and what ensures a safer investment. I will always be available to help you in any way I can. Even if it is for a restaurant recommendation, a place to go out at night, or anything else, I will always do my very best to help you! 

 

 Ownership Costs on Long Beach Island

The following is a list of estimated costs associated with the ownership of LBI. Remember that these are general numbers, and each home will be different. It is best to get an accurate estimate of the ownership costs for a home before making an offer. A buyer's agent can work with you to understand these costs and how they impact ownership costs in the LBI real estate market.

Taxes– LBI taxes are generally affordable and will range from around $1,500 for a condo to $50,000+ for a large oceanfront estate. Most people are surprised that taxes are comparatively inexpensive to a primary residence, with an average home costing about $6,000-$15,000/ year. A buyer's agent can work to verify that the numbers being presented are accurate and that you, as a buyer, understand taxation in the towns on Long Beach Island.

Water/Sewer-Most towns on Long Beach Island have metered water and sewer. Typically, water and sewer bills are about $1,000/ year for both bills. A buyers agent will help with final meter readings on the day of closing.

Insurance– Almost all homes with a mortgage are required to have homeowners insurance and flood insurance. If there is no mortgage on the property, insurance is usually elective. A buyer's agent can play a major role in helping to understand the cost of insurance and helping to identify homes that might be at risk for a higher premium before starting your search. Flood insurance in the LBI real estate market can be obtained through FEMA or a private agency. It is best to shop both options as there can be a significant difference in the annual cost. In most cases, budgeting between $1,000 and $2,500/year is accurate. Homeowners insurance depends on the amount and type of coverage you feel comfortable with. Most policies will range in the $1,500-$3,000/year range. If you are considering a townhouse or condo, a blanket insurance policy may be required for the property and homeowners insurance for your belongings. Flood and liability insurance will usually be a part of the condo HOA. The Van Dyk Group has a large in-house insurance department that can help answer any questions you have, even if you choose not to write your insurance with us. 

House Bills- Cable, internet, phone service, security monitoring, etc. are all available on Long Beach Island, and the cost will vary greatly depending on the services you obtain and the amount you use the house. Budgeting around $500/month for all these bills is in the ballpark for most owners. A buyer's agent should review the different utility bills and their estimated costs as well as offer suggestions on saving money with utility bills.