Using the promulgated New Mexico real estate forms from the Realtors® Association of New Mexico, there is a process for offers and counter offers. This process, if properly followed, will produce a document trail that makes it very clear later as to the motivations and desired actions of all participants.

1. The Buyer(s) execute a purchase agreement, or offer to buy.
2. Their broker presents the offer to the Seller(s) broker, who presents it to the Seller.
3. The Seller will execute another document, the counter offer, which indicates the differences in what the purchase offer indicates and what they are willing to do.
4. The Buyer can accept that counter offer or do their own counter to that one.

This back and forth process requires a fresh counter offer document, normally one page, for each step. This leaves an excellent paper trail for all the negotiations. It is important to realize that the purchase agreement is still valid in all its terms throughout this process. Each counter offer indicates that the purchase agreement and named previous counter offers are a part of the agreement. Each subsequent counter offer is to submit changes to all previous terms.

In other words, unless amended by a counter offer, all terms in the purchase agreement are agreed to by both parties. If you don't agree with something, it must be specifically addressed in a counter offer. And subsequent counter offers can change previous agreed upon items in counter offers or the purchase agreement.

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There are a great number of time sensitive processes and actions involved in a real estate transaction after you've come to a contractual agreement and until closing. We'll list them here and link to descriptions of each. To make it easier, a new window will open with each to keep this one visible. First a few definitions:

Delivery - The deadline date for delivery of documents or inspection or other reports.

Objections - Buyers, upon receipt of certain documents, surveys and inspection reports, have a specified amount of time in which to object to the contents of those items.

Resolution - When there are objections, the Seller has a specified time in which to respond as to whether they can or will correct items or not. Resolution of an item normally means that the transaction is still on track and that item is no longer an issue.

OK, we have those basic definitions out of the way, so let's go on to the steps in a normal transaction. If it's land, then items that have to do with structures and inspection of them would not be a part of the process. Here are the steps:

1. Contract is signed, so copies are delivered to all parties and the title insurance binder is ordered from the appropriate title insurance company. Details
2. The property condition disclosure is normally delivered right away for land or homes. There are objection and resolution deadlines. Details
3. If there are road maintenance documents, water rights, or well documents, these are normally delivered quickly also. There are deadlines for objections and resolutions. Details
4. If inspections are part of the process, the buyer should begin lining up inspectors and appointments as soon as possible to meet all deadlines. Inspection deliveries are a part of this step. There are deadlines for objections and resolution. Details
5. Special inspections and objections requirements are involved for septic systems. Details
6. The title insurance binder is provided by the title company and delivered to the Buyer(s). There are deadlines for objections and resolution. Details
7. If financing is involved, the Buyer(s) should apply for their loan quickly, as there are deadlines for this, as well as for proof of final approval. Details
8. If a home or structure is involved, the Buyer(s) should apply for insurance right away, as there is a deadline to get out of the transaction if insurance isn't available. Details
9. If a home is being purchased, there will likely be objections to the inspections. These may involve requirements for repairs, etc. There are deadlines. Details
10. A survey is almost always involved in a purchase. There are deadlines for delivery, objections and resolutions. Details
11. A day or two before closing, all objections should be resolved. In the case of a home, there can be a walk-through by the Buyer(s) to make sure all is in order for the closing and funding. Details
12. The closing takes place either local or remote. The title company funds the transaction only after recording at the courthouse. Details

That's it! It's a lot of paperwork, many deadlines, and hopefully not too much stress. Our goal is to make it all a walk in the park for our clients.

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I looked up the two residential sales with conventional mortgages, and here are a couple of notes that I think are relevant to the Taos real estate market:

1. Notice the long days on market for both, listed in 2007-2008.
2. One dropped $214,000 from initial list price, and the other dropped $74,000 from it's first listed price.

I believe we're experiencing a very soft market, quite a buyers' market at the moment, and these show buyers who are value hunters.  They're watching multiple price drops and moving in when the prices reach levels they perceive as bargains.

I've also updated inventory and absorption rate statistics.

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In fact, I guess the question is how different (or not) the Taos real estate market might be?  Or, are we losing buyers to other ski areas where prices are more attractive?

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We have a small MLS and there isn't a huge amount of competition here, so maybe those are a couple of reasons why listing brokers can continue to provide mediocre services for high dollar commission. In putting up a price change alert today, I noticed a home over $500k that had been reduced three times in price, and it only had three exterior photos. I was really feeling sorry for the seller for paying a high commission for such poor property presentation until I saw that it was owned by the broker...so they're getting what they deserve.

But, this prompted me to take another look at all of the residential listings currently active (873 of them) to see how they fared for images and virtual tours.  Here are some bullet points:

• 303, or 35% had less than the maximum 9 allowed photos of the listed home.
• 90, or 10.3% had 4 or fewer photos.
• 24, or 2.7% had either no photo at all or just one.
• A whopping 749, or 86%,  had no virtual tour link in the listing.

Sorry sellers, but why do you put up with this?  This is especially true in today's technology world when virtual tours are either free or a few bucks each.  And, with digital cameras, why would there not be enough about your home worth taking 9 easy, fast and free pictures?  In that group with zero or only 1 image, almost half were over $300k, with at least one listed at more than $1.2 million.

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I've also updated inventory and absorption rate stats, so check how it looks today in relation to past updates.  Keep in mind that inventory and absorption rates are not a report available from the MLS in the past, so unless someone else is going in and doing these periodically, this is the only place you'll find historical records of these numbers.

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In the article "Housing Market: Buyer Really Beware," Time.com states that today's market causes desperate sellers to omit material facts, or even lie, to get their home sold in a buyers' market.  Items mentioned include:

• mold
• incorrect taxes
• lot size mis-stated
• home size mis-stated
• no or under-stated utility bills
• not disclosing pest problems, noise issues, past damage, etc.

The article suggests that the buyer ask to see utility and tax bills, get inspections, etc.  It's interesting to me, as there's no way one of my clients will get close to closing with mis-stated square footage or lot size, or any major problems in the areas discussed in the article.  It's my job as a buyer broker to get this information and all disclosures to them as quickly as possible.  And, by the way, in our long days on market, a disclosure a year old isn't going to cut it.  I'll want a new one.

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• They're still difficult to get, but easing a bit from last year
• Jumbos are not getting much easier
• Higher down payments, with 10% not cutting it much anymore, more likely 20% to 35%
• Condos are harder, and a 30%+ rate of rentals in the project may stop a mortgage application in its track

"Lenders now appear more willing to finance second homes, but borrowers must be patient, eminently qualified and strategic about their housing choices"

That last one, a direct quote, bears comment.  Appraisals have become more conservative, and the buyer really needs up-to-date comparative market analysis reports that don't just look at past sales.  First, there aren't that many.  Second, looking at the competition in the market helps a buyer to craft a better offer and end up with a better deal.  If a buyer's broker is doing their job, the market analysis will cover both recent sales and competitive listings, and I've even been known to submit this report as an exhibit with a purchase offer.  It can help the listing broker to be real with the seller about the value of their property in today's market.

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