How do Handyman Laws Pertain to Flippers?--Please respond!

[James Christian]

Our family just finished working on our first flip.  We came in on budget, did much of the work ourselves, had the property under contract to sell with a $60K profit, and the buyers backed out at the last minute.  While we were in escrow, we learned about a law in Arizona that states that if you complete more than $1,000 of repairs in labor/materials outside of work done by a licensed contractor, you have to wait a full year before you can sell or rent it.  Now that the buyer backed out, we are planning on moving into the flip in order to be compliant with the state law.  This devastated our plans and we are nervous that either A) we won't be able to make any profit because of expensive GC's having to do all the work, or B) we won't be able to accelerate our growth because we will have to wait a full year before selling each property.

How are the rest of you dealing with these types of laws?  I know each state is different, but from what we've looked up, there are many states with similar handyman laws.  We are freaking out about this information, we feel like this law is ruining all of our plans.  Please respond!

[Jaysen Medhurst]

@James Christian, I've never heard of a law like that before. I would look into what it takes to be a licensed GC in AZ. In lots of states, it's just filing out a form and taking out insurance. Might be a good work around and potentially have the advantage of opening up "to the trade only" vendors and pricing on materials.