Cocoa Beach Insider

If you are looking to buy a condo in the Cocoa Beach or Cape Canaveral area, you might come across the term First Right of Refusal in some of the marketing and MLS descriptions. This was pretty common practice for condos in the 1960’s and 1970’s to have in their condos rules and regulations. The exact reason for this, I really don’t know. I do know that if you happen to find the perfect condo for you, the first right of refusal will add a little stress to the transaction once your offer has been accepted by the seller.

So, what is a “First right of refusal?”

Once a condo is for sale and goes under contract with a bonafide buyer, the sales contract is then presented to all the owners and they get to decide if they would like to exercise their right and purchase the condo for the terms you and the seller agreed upon. Depending on the complex, the timeframe an owner has to decide is anywhere from 10 days to 30 days. This means you as a buyer, after house hunting, finding a property, figuring out the offer, either arranging for your mortgage or freeing up the cash to purchase has to then wait to see if you are actually going to be the new owner of the condo. If you do happen to be a buyer submitting the offer, make certain you have a real estate agent that is familiar with the first right of refusal because you have to structure your offer with this in mind. If you are reading this post, hopefully you will just call me to help find a condo and you will have one less thing to worry about.

Here are some things I will include in your offer:

All the timelines in the contract, the escrow, the inspection period, loan application, loan approval, etc will all start after we are through the first right of refusal timeline. I cannot recommend having a condo inspected if there is a chance you are not going to be the owner.

Increase your escrow deposit to as much as you are comfortable doing. Since the owner who exercises their right to purchase has to honor the terms of the contract, they will have to put that much into escrow if they decide to purchase the condo.

Pay cash. If you can, pay cash for the condo, write it up as a cash purchase. If the owner does not have the funds to write a check, it is less likely they will exercise their right of first refusal. (Unfortunately, though, most owners who get condos through the first right of refusal end up paying cash for the condo) 

Make the closing as quickly as possible. If the owner is not able to meet the closing date as written, it could also be a deterrent for them to buy your condo.

Yes, trying to buy a condo that has the first right of refusal as a condo rule can be nerve-racking. If you do make it through this process and end up buying the condo, it does put you in a pretty good position to get a second or third condo when a good deal happens in your condo complex.

Do you have questions about buying a condo in Cocoa Beach, Cape Canaveral, or anywhere on the Space Coast? I would love to hear from you! I get questions every day from people who are moving into our area and I would love to hear your questions. Call me, text me, or comment below; I am here to help!

Eric Larkin is a Broker Associate with Real Broker, LLC. He lives, works, and plays in the Cocoa Beach area. If you have questions about moving or relocating to Cocoa Beach and the Space Coast, let me know! I get calls, texts, direct messages & comments on my posts every day about the real estate market and things that are happening in Cocoa Beach and the Space Coast that I love answering. Ask me your questions on moving, relocating here, or anything about the community. I am here to help. I have been helping buyers and sellers with their real estate needs since becoming a real estate agent in 2003. My focus is always on helping, answering your questions, and doing everything possible to make certain you have a smooth transaction from beginning to end.

Planning a move or have questions about our area? Eric Larkin with Real Broker, LLC can help! Schedule a call here https://www.ericlarkin.com/schedule-a-call 

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