We recently completed a transaction on a house, where there was a community well involved. Rodrigo goes over the points of what’s important to consider when selling a house with a community well.
Probably the most important thing when buying or selling a property on a community well is to be sure that a well agreement is in place. A well agreement, which is an outline or agreement that states that a specific property has the ability to use a specific well and that may also specify how much water, how often, and for how long the property can access the well, will ensure that, in the event that a property is sold, the new owner can continue to access the well. Because a well agreement may have rules and restrictions as far as the duration of use, deed transfers and sales, and so forth, it’s important to understand the specific terms of the agreement prior to selling or buying a property on a community well.
In addition, a community well may carry a monthly cost – this often works in lieu of a water bill and helps to cover the electricity needed to power the pump as well as general maintenance that may be required. The well agreement should also clearly state who is responsible for the water lines and their upkeep and repair, and whether the costs of any potential repairs are included in the monthly cost, if there is one. This will help to prevent any confusion or disputes that might arise if lines on common property or on one individual’s property but running to a different property require upkeep.
For sellers, it’s essential to check the details of your well agreement and clarify the questions above prior to putting their property on the market. Doing so will ensure that the buyer doesn’t have the ability to use the lack of a well agreement or any shortcomings in its contents as leverage to push the selling price down. For buyers, it’s equally important to check for a well agreement and to become familiar with its terms in order to ensure that they will be able to continue accessing the well upon purchase and that the terms are agreeable.
If you’d like to learn more about how community wells work, what a well agreement should look like, and how to handle the sale or purchase of a home on a community well, reach out to us at AshevilleCashBuyers.com or at 828-222-6443!