East Bay Real Estate Point of Sale Ordinances Explained | Don’t Make An EXPENSIVE Mistake!

Most people who want to buy a house in the East Bay think about comps and floor plans. Those are important but you should also be aware of all the Point of Sale ordinances that come along with buying a house.

Point of Sale ordinances refer to anything that needs to be retrofitted, inspected or upgraded in order for a property to be sold. They have to be addressed either before the seller puts the house on the market, at the time of sale, or deferred after the sale is closed and to be done by the buyer shortly thereafter.

Ordinances:

1. Sewer Lateral

A sewer lateral is the line that connects your house’s sewer to the city sewer system. It’s an ordinance because most East Bay cities want them to be pressure tested and to make sure that there’s not an active leak. In addition, an unmaintained private sewer lateral can cause more costly problems. For example, the leakage of untreated sewage into the soil and into the groundwater.

To avoid these problems, make sure to look for the following in the disclosure packet:

  • The bid for the pressure test
  • The bid for the replacement of the line if in case the test fails
  • Lastly, read the quote to make sure it is given by a reputable company.

Since replacing the sewer lateral costs thousands of dollars, averaging from $5,000 to $7,000 in the East Bay, it will always be a good idea to check who’s going to do the work. 

With regards to who’s going to pay if the sewer lateral needs replacement, it can either be the buyer or the seller depending on your negotiations. If it is deferred until escrow and the buyer will shoulder the cost, another thing the buyer needs to take into account is the amount to be deposited into escrow.

The buyer, will be required a $4,500 deposit. The municipal district will then hold this deposit usually for a minimum of six months with no penalty until the work on your lateral is complete. As an incentive, if you get the work done within this allotted time, you get your whole $4,500 back. Otherwise, they will start taking parts of your deposit.

NOTE: Most properties inside of an HOA are exempt from this one because the HOA is actually responsible. 

2. Gas Shut-Off Valve

The gas shut-off valve is a small red box placed on your gas meter. In the event of an earthquake, a little ball will fall down inside this box and shut off the gas that goes to your house. The main idea is if the gas line breaks and there’s an electrical fire, it won’t ignite the gas and blow up your or neighboring homes.

Not all cities in East Bay has this ordinance. Alameda does. However, whether or not it is an ordinance in your city, a gas shut-off valve is a good safety feature to have in your home.

3. Sidewalk Ordinance

Under this ordinance, the maintenance of the sidewalk in front of your property becomes your responsibility. This means that as part of closing the escrow, someone is responsible for making sure the sidewalk does not have any divots or cracks that are raised over a quarter of an inch. Unfortunately, in cases when there’s a tree or uneven pavement, you may end up replacing parts of the sidewalk.

As with the other ordinances, make sure to go through the disclosure packet to check for the bids. The bids usually won’t be too astronomical and would usually range from $1,000 to $5,000 for the usual sidewalk length. 

With this in mind, if you’re looking for a house to buy in Oakland or Piedmont, make sure to remember that there is such an ordinance. It can help you plan accordingly if for example, you’re buying a corner lot with two sections of sidewalk, a property with lots of trees, or if ever you’ll need to replace parts of the sidewalk.

Other ordinances from other cities:

4. Berkeley Energy Audit

This ordinance stipulates that owners must conduct energy assessments of their property and disclose findings in an Energy Report.

5. Berkeley Seismic Tax Credits

This ordinance states that to be able to be eligible for a reduction in real estate transfer tax, building permits submitted for qualifying seismic strengthening work must comply with specific technical guidelines. You may check this link for the guidelines set by the city.

6. Oakland's Water Conserving Plumbing Fixtures

If you will be doing additions or improvements to your property, you will also be required to replace your property’s plumbing fixtures with water-conserving plumbing fixtures.

7. Pool/Spa Safety

In general, this lists guidelines for the installation of safety devices if your property has a spa or pool. 

In conclusion, since every city in every state imposes its own Point of Sale ordinances, make sure to really dig into these ordinances with your agent . Sellers also often expects the buyers to take on these ordinances so it is very important that you’re well-informed about what you’re signing up for, how much money you have to spend, and what timelines are associated with these things. 

I hope this list has helped you. If I can give you more context on the process of buying your first home, please do not hesitate to reach out. My information is below. 

Here’s to all your success!

Best,

Hans Struzyna,

The market has shifted and you need to be aware of where we are going. I have created a free resource packed with all the information I tell all my clients when they start shopping.

Download my COVID Era Buyers Guide:

(510) 768 - 8228
DRE # 020284245
EastBayHans@gmail.com