Time is of the Essence

I had to smile the other day when I was teaching a class on the new NVAR Sales Contract to be released January 1st 2012.

Among the changes I noticed was the inclusion of clause 30; “TIME IS OF THE ESSENCE AS TO ALL THE TERMS OF THIS CONTRACT”.

In my 34 plus years in Real Estate this clause has appeared and disappeared in our contract iterations several times.  Most recently it was not part of the main contract but inserted in the various Jurisdictional addenda’s.  This got me thinking about how sales associates go about explaining this clause if their client asks, or holding to it.

We spend time reviewing and commenting on contracts, with stock words or phrases that should mean a lot to us – but oftentimes little, if anything, to our clients. Some of those words or phrases are absolutely essential; others have lost their impact over time. One of the latter is the phrase: “time is of the essence,” which Black’s Law Dictionary defines as, “performance by one party at [a] time or within [a] period specified in [the] contract is essential to enable him to require performance by [the] other party.”

So can we explain this? What does it mean in plain English? Well, by including this phrase it simply means that one party to a contract is automatically entitled to terminate the contract if the other party fails to perform upon the time and conditions specified in the contract.

And that’s important, right? Ok… let’s explore the possibilities.

Most lawyers I know dislike vagueness in any contract language and “time is of the essence as to all the terms of this contract” certainly qualifies. Inclusion of the phrase provides a judge with evidence of your intentions when you entered into the contract, but in and of itself, and without further specificity, this may not be sufficiently strong enough to support a verdict in your favor, if a contract problem ever gets that far. Given all that, I would encourage you not to rely too heavily on the simple existence of this stock phrase in your contracts. Instead be sure your requirements for performance are accurate, specific and time-constrained.

In practice, since no one ever wants to spend the time, money and emotional angst trying to prove their case in court, here are three recommendations to strengthen intent and give it some enforcement:

1. Clearly state your expectations – both time and quality, for performance or delivery. Do not fall victim to vagueness, either yours or that of your client. This will not serve either party well in the end.
2. Confirm that all dates and deadlines are accurate. Do not allow for assumptions, or performance, to be qualified as “best efforts.” You want the terms plain and clear to both parties.
3. Put on your judge’s hat. If it’s vague, or unclear to you, chances are, it would be to a judge as well. Step back from your contract and try to see it through a third party’s eyes.  Consider how a judge, months or years down the line, might interpret the language which documents this contractual agreement.

Know your contract, be accurate, be precise and be clear.

- Scott Avery, President, Avery-Hess Realtors

Find your home, Plan your life: www.averyhess.com

Centreville, VA Market Report 8/15/11

Centreville continues to mirror the Fairfax County market. Centreville showed a 5% decline in average sales price over July 2011, while the county overall showed a 3.25% decrease.

This appears to be only a slight “hiccup” in our overall stable market.  June showed a healthy increase, and overall the trend is still going upward for the year.

July Statistics for Centreville:

All indications show that the Centreville market will enjoy a steady increase in value.  We must remember that July of 2010 contained a larger number of foreclosures and short sales, which are down considerably in 2011.

If you considering buying now, don’t hesitate, interest rates continue at all time lows.

Market data, commentary, and statistics proved by Jim Agnew, Managing Broker, Avery Hess, Realtors, Dulles Area Office, Centreville, VA

McLean/Tysons Corner, VA Market Report – 8/10/2011

Tysons remains the vibrant center of business and shopping in Fairfax County; despite the traffic congestion and the continuing road construction for the widening of the beltway and the Metro extension to Dulles.

Perhaps with an eye towards the future, when all of the projects are completed, people are buying homes in the Tysons Corner and the surrounding neighborhoods.

Comprised of 3 different zip codes, the Tysons area has remained overall stable year over year, with 22180 seeing declines in total volume and average sales price, but 22043 seeing significant gains in both categories.

The statistics for July 2011 are relatively unchanged from 2010.

It will still be several years before the road & Metro projects are completed, but as much as Tysons Corner is the center of business and commerce today, the future promises great opportunities for those who act now.

If you are considering purchasing now is the absolute best time. Prices and interest rates are at historic lows.  While the Fed has indicated that rates will remain low for a few years, the price of housing is certainly going to increase.

If you bought gold in 1996 for $400 an ounce you were probably depressed in 1999 when it dropped to $250. How delighted you are today when it reached $1700.

The housing market is cyclical and historically always rebounds. It may have taken longer this time around but it definitely will again.

Market data and commentary provided by Charlie Carroll, Managing Broker, Avery-Hess, Realtors.
Search for homes in McLean, Tysons Corner and all of the DC Metro: www.averyhess.com

Bristow, VA Market Report – 4/14/11

Despite the ongoing news about rising interest rates, more foreclosures properties entering the market, and no buyers, Northern Virginia continues to sustain a steady growth in most markets.

The Bristow community however is bucking this trend for the 1^st quarter of 2011.

Market Statistics for Bristow:

The bright side is that the number of properties under contract for the month has increased over 2010, which indicates that the number of sold properties will show an increase for the month of April.  March of 2010 had fewer listings, contained a larger number of foreclosures and short sales, and was driven largely by the first time buyer tax credit, particularly is the under $400,000 price range.

Market data, commentary, and statistics proved by Jim Agnew, Managing Broker, Avery Hess, Realtors, Dulles Area Office, Centreville, VA.

McLean/Tysons Corner, VA Market Report – 3/30/2011

February and early March have seen a downturn in the real estate market throughout much of Northern Virginia due to several factors, not the least being the colder than average winter weather. Tysons Corner, the shopping and employment center and unofficial downtown of Fairfax County did not escape this trend. Another major factor for the Tysons Corner area is the massive amount of road construction for the Beltway HOT lanes and the expansion of the Metro.

The number of units sold was approximately the same as the previous year but the average sales price was down more than $90,000.

Hopefully, since the calendar indicates the arrival of spring, we will have improved weather conditions but the road construction issue will remain for quite some time. While residential real estate seems to be lagging, the commercial market is gearing up and building construction continues. There is no doubt that the residential market will once again be robust as Tysons Corner becomes accessible by Metro.

Market data and commentary provided by Charlie Carroll, Managing Broker, Avery-Hess, Realtors.

Search for homes in McLean, Tysons Corner and all of the DC Metro: www.averyhess.com

Centreville, VA Market Report 3/28/11

How does the Real Estate Market look for Northern Virginia this year?

All of the signs are for a strong market and increasing listing and sales prices.  Due to continued low interest rates and low inventories, the demand from buyers will continue to outrun the supply.

The Centreville, VA statistics reflect the overall climate for Northern Virginia:

Total 49 Unit Sales for February 2010

Total 58 Unit Sales for February 2011 – a 9 unit increase from last year

Average sale price for February 2010 was $288,836

Average sales price for February 2011 was $319,093 a dramatic 10.5% increase

Average days on the market listing to contract for February, 2011 was 52

If you are considering selling your home, get ahead of the start of the Spring market, pick a reputable well known and well capitalized company, interview at least 2 qualified agents, prepare your home and sit back and wait for the contracts.

Market data, commentary, and statistics proved by Jim Agnew, Managing Broker, Avery Hess, Realtors, Dulles Area Office, Centreville, VA