Section 2.5.2 Reporting New Construction Where Lot is Sold First, Improvement Sold Later

Section 2.5.2 Reporting New Construction Where Lot is Sold First, Improvement Sold Later

  1. Construction to Perm Financing: (Lot closes and bank loan pays builder to start & finish construction.)
    1. Do not enter lot as a separate sale(not a land listing).
    2. Where the buyer can choose the house plan, enter the listing the same day it goes under contract with a status of Pending (You will need to add it as an active listing, save it, and then change the status to Pending.) Under no circumstance would you wait until closing to enter the information.
    3. Follow the Photo Guidelines Exhibit 3
    4. Change the status to Closed when the deed is recorded and proceeds disbursed.
  2. If Not Reporting Sale of Lot Separately:
    1. Enter the listing as Pending once house is closed in by the builder
    2. Follow the Photo Guidelines Exhibit 3
    3. Follow Rules to report sale after deed is recorded and proceeds disbursed.
  3. If Reporting Sale of Lot Separately: (Where recording lot sale is desired)
    1. Lot Sale:
      1. If the lot is listed in the MLS. Change status to Pending, then Sold following all other Rules.
      2. If the lot is not listed in the MLS, enter it as Pending when it goes under contract.
      3. Follow the Photo Guidelines Exhibit 3
      4. Follow Rules to report sale after deed is recorded and proceeds disbursed.
    2. Improvement:
      1. Whenever construction starts on the improvement, enter the listing as Pending. In the first line of the Agent Remarks enter the following: Previous lot sale reported as MLS number ____________.
      2. Follow the Photo Guidelines Exhibit 3
      3. Follow Rules to report sale after deed is recorded and proceeds disbursed.
      4. It is prohibited to enter the sale of any new construction where the Participant is entering just the construction cost of a home as the sale price (custom build, no real property transferring.
      5. It is prohibited to enter new construction where the Participant is adding the price of a land sale to the cost of subsequent construction cost (two separate contracts) and using the sum of the two contracts to create a sale price of a single family home. Such a transaction should be shown as a vacant land sale.

Note: The listing agreement of a property entered into the MLS by the listing broker should include a provision expressly granting the listing broker authority to advertise; to file the listing with the MLS; to provide timely notice of status changes of the listing to the MLS; and to provide sales information including selling price to the MLS upon sale of the property. If deemed desirable by the MLS to publish sales information prior to final closing (settlement) of a sales transaction, the listing agreement should also include a provision expressly granting the listing broker the right to authorize dissemination of this information by the MLS to its participants.

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