The moving industry is ripe with fraud and deceit. Consumers who are shopping for moving companies will inevitably come across what amounts to move-brokers who are making promises on behalf of third-party subcontractors. Previously, I’ve seen the subcontractor arrive onsite and immediately demand an extra $5,000 to do the job, and in this case, they didn’t show up at all.
After a swift 25-day escrow that closed on time, we had to help the sellers – who had already left town – make sure their stuff got on the truck and hit the road!
We’ve completed many regular and reverse 1031 exchanges, and it is critical to follow the IRS rules when identifying the replacement properties.
For a successful 1031 exchange, it is important to understand and comply with the 1031 exchange identification rules. These rules are not that complicated, but a failure to follow the rules may ruin your exchange.
Here are the top ten things to remember when identifying replacement property in an exchange:
Speaking of the joys of being a landlord, here is the C.A.R. summary of how to handle the security deposit:
California law allows a property owner/landlord/property manager (housing provider) to collect from a residential tenant a security deposit before the tenant takes possession. The amount of the security can be equal to two-months’ rent for an unfurnished dwelling, and three-months’ rent for a furnished unit.
At the end of the tenancy, the housing provider can use the security deposit (i) to recover the cost of repairing damage to the premises, exclusive or ordinary wear and tear, and (ii) for cleaning necessary to return the premises to the same level of cleanliness it was in at the beginning of the tenancy. The tenant is entitled to an itemized statement of the use of the security deposit within 21 days of vacating the premises. The best way to determine if the security deposit is being used for a proper purpose is to document the condition of the property at both the beginning and end of the tenancy.
Many standard form leases contain a provision similar to paragraph 10 in the C.A.R. Residential Lease or Month-to-Month Rental Agreement (C.A.R. Form LR) to address the condition of the premises.
NEW YORK, July 29 (Reuters) – Beset by COVID-19 and its fallout, local landlords are offloading their properties to cash-rich institutional investors, and America’s real-estate market may never be the same.
Before the pandemic, boyhood friends Michael Murano and Richard Tyson owned 96 rental units in their hometown of Rochester, New York. They offered accommodation to low-income tenants, many in the service industry, from rooming houses to single-family starter homes.
Today, they’re well on their way to liquidating the entire portfolio. Two-thirds of the units are already gone. The buyers? Large investors with all-cash offers.
“It broke my heart to sell 15 single-family homes to just one, out-of-state big corporate investor,” said Tyson, a 38-year-old U.S. Navy veteran.
“The last thing we need is to be exporting wealth out of this community, and limiting wealth creation here. But I knew we had to get the hell out of affordable housing – fast – because this was going to be a tidal wave coming at us.”
Many of America’s landlords have gone a year and a half without being paid by tenants, who’ve been protected by several state and local eviction moratoria as well as an umbrella federal ban enacted 11 months ago.
The owners have been waiting for $46 billion to help them survive without that income. The funds were approved by Congress months ago, but bureaucracy creaks; only $3 billion has reached them so far, according to U.S. Treasury Department data.
Now the eviction ban is about to end – on Saturday. Yet thousands of local landlords have already quit the business. And a growing number, like Tyson and Murano, are on their way out.
Taking their place: institutional investors, broadly defined in the industry as firms owning more than 1,000 units.
It’s looking more normal every day, though by the time the last sale is recorded, this month’s total should be around 300 sales (though the median SP will say about the same at +29% YoY):
NSDCC (La Jolla to Carlsbad) July Sales
A civilian said to me yesterday, “You just wait until the eviction moratorium is over, and prices start dropping right back down!” Sales would need to drop to zero before the vast majority of sellers will consider making any significant concessions on price. You might see an occasional sale under comps, but there will be a reason – inferior location, bad condition, etc.
I’ll keep this photo handy!
The total number of pendings have been rapidly descending with frenzy-escrows closing out. But new listings should taper off from now on, so we’ll see which drops faster:
NSDCC Actives and Pendings
In the previous FM, I said that the March-May period had to be the hottest of all-time, but we had 400+ pendings from June 22nd to November 30th last year – with a peak of 491 pendings on September 7th.
We can also track the average market times too. Any upward trends here would indicate market slowing:
There is slowing of market times in all price ranges but averages of large sample sizes don’t move quickly.
Kayla on the left, me on the right.
We lost Dusty Hill today, bass player of ZZ Top. He was 72 years old. I had the Tres Hombres 8-track blaring through the desert sky back in the 70s, and I saw them play at Feyline Fields in Tempe around 1976 when they headlined a 5-band, day-long bash. So this is my ZZ, with Dusty on co-lead-vocals:
Another reflection on the current state of the local market.
While it feels a little softer and active-inventory counts have risen (though still well below previous years), the demand has been voracious, and it would need to cool off dramatically before any panic sets in.
There have been 100+ higher-end sales in EACH of the last three months, when, prior to the pandemic, we never had more than 48 in a month!
The number of sales is a leading indicator. Let’s keep an eye on them!