Clarification for Energy Audit Requirement

For a quick reference I have provided a break down Q & A regarding this new regulations.

The new requirements are found in NRS 113.115, which was passed by the Nevada Legislature in 2007 and amended in 2009. The Nevada Energy Commissioner recently adopted regulations that provide a framework for the evaluation form.

Note: All residential transactions that close on or after January 1, 2011 must comply with the new law. Either the evaluation form must be completed and provided to the buyer or the parties may waive the requirement by using the waiver form on the bottom of page 4 of the form. 

Who should complete the form?

Like the Seller's Real Property Disclosure form, the energy evaluation should be completed and signed by the seller, not the real estate licensee. Alternatively, if the seller chooses to have an energy evaluation performed by a certified inspector, the inspector will complete and sign the form. When must the form be provided? NRS 113.115(2) states that the seller must provide the evaluation form "before closing a transaction for the conveyance of residential property." The law does not specify a date or a number of days prior to closing.

What transactions are exempt?

NRS 113.115(3) provides four exemptions:

• By foreclosure pursuant to chapter 107 of NRS. (Note: This means the Trustee's sale; it does not mean an REO. REO transactions are not exempt under this provision.)
• Between any co-owners of the property, spouses or persons related within the third degree of consanguinity.
• By a person who takes temporary possession or control of or title to the property solely to facilitate the sale of the property on behalf of a person who relocates to another county, state or country before title to the property is transferred to a purchaser.
• If the seller and purchaser agree to waive the requirements of subsection 1 [of NRS 113.115].
  
  Additionally, per NRS 113.115(4), if the seller completed an evaluation within the previous 5 years before signing the purchase agreement with the buyer, the seller may provide that evaluation to satisfy the requirements of NRS 113.115(1).

May the buyer and seller waive the evaluation form?

Yes. When the buyer and seller mutually agree to waive the requirements of NRS 113.115(1), the evaluation is not required. The waiver is found at the bottom of page 4 of the form.

Does this new law apply to transactions already in escrow as of January 1, 2011? 
Yes.  The seller in any residential transaction that closes on or after January 1, 2011 must comply with the new evaluation form.  If the parties choose to waive the requirement, use the waiver at the botrtom of page 4 of the form. 

If the seller provides the evaluation form, does the buyer have the right to cancel based on what's disclosed?
There is no independent statutory right of cancellation provided in NRS 113.115 or NRS 701.250. Thus, for a buyer to cancel based on what's disclosed on the evaluation form, it would have to arise from a contractual right such as the due diligence period.

Does the buyer have to sign the form?Yes. The buyer signs on page 4 that he/she has received the evaluation form.  From a risk management standpoint, a fully executed copy of the form should be kept in both the listing and buyer agent's files.

Any questions please do not hesitate to contact me.

Heather Etchings

Realty One group

702-277-7071

HeatherEtchings@Gmail.com

Brand New Nevada Revised Statute Effective January 1, 2011 "Energy Audit"

Home Buyers in Nevada have something new to look forward to and Sellers another step to providing "Full Disclosure" to potential buyers. It's the "Energy Audit" now required and mandated by Law for residential property point of sale transactions. As of January 1, 2011, Sellers will be required to provide a three page disclosure of the energy consumption of their home or Buyers can waive their right to one.

All the details and NRS can be found here: http://renewableenergy.state.nv.us/.

Being someone who purchased in Nevada 17 years ago when there wasn't so much as a Sellers Real Property Disclosure, Nevada has come a long way in protecting the prospective home owner and Sellers. Whatever state you are purchasing in it's always a great idea to check what is required by law in the form of disclosures. Many who choose to Sell directly to the buyer (For Sale By Owner) could find themselves in legal trouble for not following the law and a Buyer who choses to buy directly from the Seller thinking they will hatch a better deal, beware you may be buying a lemon and without the proper documentation or representation from a Realtor you could be in for thousands of costly repairs.

Vegas is Selling Fast so As always Happy Home Hunting!

Heather Etchings