By Nick Schoch
Many apartment investors don’t like debt, so rather than refinancing, they would prefer to pay off their loans. Why get a new loan when you’d prefer to have no loan? If that describes you, you may want to reconsider. Used wisely, debt is a powerful tool that can help you reach your short- and long-term investment goals. Let’s take a look at seven challenges and how refinancing can be a solution.
By Nicole Seidner
Owning and managing a rental property can be a dream job! You can make money by letting people occupy space, you still get paid when you’re on vacation, and all problems are solved easily between the average work hours of nine and five.
Well, two out of three isn’t bad, right?
By Jon Coupal
Californians are keenly aware that we bear a heavy tax burden.
Progressives claim that the tradeoff is low property taxes, but that’s just not the case. California ranks 17th out of 50 states in per capita property tax collections. What can be said about Proposition 13 is that it has made property taxes reasonable, not low.
A vetted pool of qualified non-profits will be the first buyers to come to the trough when buildings with three or more units in San Francisco are about to go up for sale, courtesy of COPA.
Before you start singing the hymns of Barry Manilow’s Copacabana, we are referencing the City’s newly minted Community Opportunity to Purchase Act, one of the many incremental steps taken by the City aimed at solving the affordable housing dearth.
Less than a year after California voters rejected rent control in a statewide ballot proposition, Governor Gavin Newsom has signed legislation imposing it. For rental units 15 years or older, rent increases will be limited to 5 percent annually. The negative consequences of the new law are extensive. Older buildings, likely to require the most maintenance, will fail to recover costs—leading to “shabbification.” New construction, desperately needed in a state with an estimated housing shortage of millions of units, will also dwindle. Developers confront a future with limited returns on investment. And, as always with rent control, incumbent renters—assured cheap housing, regardless of their income—will benefit, while newcomers see only “no vacancy” signs.
By Eric D. Jarvis, Esq. | Founder of ReassureRent
It’s every landlord’s nightmare: A tenant who can’t, or won’t, pay the rent. You’ve invested in your property. You are obligate to continue to pay taxes, insurance, a mortgage, and maintenance, and you depend on that income. You provided a home for your tenant and you have a right to expect that tenant to keep their end of the deal. Now you’re involved in a time consuming and emotionally draining eviction process. In the best situations, you will pay some legal fees and lose some rent. In the very worst situations, you could spend thousands in legal fees and lose half a year of rent before you get your property back.
The client has invested in real estate since 1987. After experiencing difficulties in renting an industrial property she owned for the past 13 years, it was time to sell. Having sold many properties in the past, the concept of doing a 1031 exchange was all too familiar to her. She questioned whether or not to do it this time. In consulting her financial advisor and CPA, she was informed of the tax consequences in selling this property. In hearing this information, she inquired into the best course of action for her tax situation. The advice was based on a simple question, “Do you want another rental property”? Emotionally, the client was tired of the responsibilities associated in being a landlord, in addition to everything involved in purchasing another rental. Logically, however, it was concluded that the best course of action was to purchase a replacement property and defer the taxes.
Another week, another lie about Proposition 13. The new narrative from the Prop. 13 opponents is that California’s high fees for building homes and commercial property is due to Proposition 13 denying local governments the ability to raise revenue.
A study just released by the University of California Center for Housing Innovation concluded that the “impact fees” that local governments charge developers are a big reason why it’s so expensive to build a home in California. The fees are not only costly, they’re also unpredictable, lack transparency and can kill a project’s viability, according to the study.
Real estate is a weird, weird world to work in. Being a landlord or rental property owner has its own challenges without trying to keep an eye on every single out-of-place law that there is. Most of the time, legislation can make sense, but some of the time, the “black sheep” of laws seems to come out of nowhere. Check out some of these nonsensical laws that seem difficult to explain.
