All Forum Posts by: Josh Prince

LAR2 is for SFR or two unit properties. A 5 unit is existing nonconforming. If it was a total loss you could not rebuild your existing configuration, but you are allowed to maintain it. Also, I don't think you can expand at all (even sq footage expansions). Absence of a rare total loss, I don't think you have many day to day issues. I suppose the development potential is limited, but depending on the neighborhood, a SFR might be worth more than the existing 5 unit.

It is my experience that you or your agent can get the set up - i.e., rent roll and P&L with a phone call to the listing agent.  Leases, estoppels and a walk through will require a signed contract, but the basic financials are often given away if not provided in the listing.

Hi @Francis A. - I am not trying to make this contentious.  Glad to hear your thoughts.  

@Lee L. if its under rent control all leases default into month to month or another similar lease.  You cannot contract out of rent control like that.  Everyone would do it otherwise. Good idea though.

@Lee L. has a good point.  There may be legitimate reasons to change the lease provisions that she describes, such as manner of paying rent or other administrative concerns.

In Los Angeles, you can evict a tenant with a rental agreement for failing to sign a new agreement that is similar to the old agreement.  

Does this let you force a tenant on MTM into a 1-year lease?  Yes.  

However, I do not believe you are within your rights to threaten eviction because the tenant will not sign a lease that imposes new obligations or restrictions on the tenant, such as late fees, curfews, non-smoking (when the tenant was allowed to smoke before), etc.

I think if you proposed that a tenant sign a lease like this or leave, and they went to the housing department it would be viewed as coercion or an illegal eviction.

@Francis A. - Have you had experiences that indicate otherwise?  

One other factor, in the landlord's favor, but in my opinion not ethical to take advantage of, is that many tenants are unaware of their rights. I know a number of deals where the new owner just showed up, told the tenants they had to leave and paid them out $1000 each and they went.  They didn't know any better. Of course, they could always come back with an attorney or a nonprofit organization and make trouble for the landlord.

To me, in most cases, paying the statutory relocation fee is a bargain when you multiply the additional rent by your cap rate or GRM and see the difference that market rents will make to the worth of the building. I'm generally willing to pay statutory relocation fees to all my legacy tenants in a heartbeat.

@Eric Zunkley - I doubt an offer demanding vacant units would have much traction.  Most sellers don't want to have to deal with a bunch of hassle before they sell, and I am sure there are buyers out there who would take the hassle on themselves.  That being said, if you get into escrow, it may be something to try to bring up if you sense that the seller is desperate to close with you.

If you are attempting to owner occupy after the purchase, you and your partner would need to take as tenants in common or something similar (i.e, both of you on title), and then each of you could seek to occupy a unit as owners - that would be 2 units total. 

If you owned it in an LLC I don't think you can owner occupy, but you should check the housing dept regulations to be sure. All things being equal you would need to evict the most recently rented units - exceptions would be if some units are different size or composition.

You would need to pay the relocation fees that you show, above, and there are some circumstances in which you would not be able to evict tenants for owner occupancy at all - for example, if they were old or disabled and have lived in the property for a certain number of years.  I would confirm your plan with your agent and the housing department before you buy.  I have known people who expected to evict tenants for owner occupancy only to learn after purchase that it was not a possibility.  Good luck!

@Mike G. 

 This is exactly my understanding of so called land trusts in California.  They provide anonymity but no other real benefit.  I often hear people talk about the innumerable sophisticated techniques and advantages of being an expert with land trusts, but no one can list them out.  The only other use I have seen deals with the ability to transfer beneficial ownership rights in the land by assigning the beneficial interest in the land trust but i don't understand how that is better than using a business entity.   Can anyone else explain the additional benefits?  @Morry Eghbal ? @Ellis San Jose ?

Hi @Logan Allec and Ewa mentioned, it is possible, and not illegal to negotiate with tenants on the side for an informal relocation payment.  However, if you strike a deal with a tenant to move out for an amount that is less than the relocation assistance amount they would be entitled to - and they find out and complain to the housing department, they could potentially complain that you had coerced them into moving out and giving up their rights or something like that.  In case you haven't figured it out, the rent control section of the LAHD/LAHCID etc. is not especially pro-landlord and is going to look closely at cases where tenants have moved out of rent controlled apartments and then are unhappy about it.

Also, I have attached a link to the latest housing dept information for relocation assistance:

 http://lahd.lacity.org/lahdinternet/LinkClick.aspx...

Good luck and let us know how it goes!  (or post the deal if you are not going to move on it!)

Hi @David Doyle -thank you very much for your response.  Just to answer your question, yes the guy is licensed and bonded. I don't know about insurance or commercial vehicle - he has a truck.  

Anyhow, some of the rate may be explained because he works on his own, charges for time he spends getting materials and etc, so its not just time with a wrench in his hand.  In any case thank you very much for your recommendations. I ended up getting a couple of recommendations from developers/landlords I know and will just start taking competitive bids.  I will also try calling some of the local plumbing supply houses as you recommend.  Good to know I was at least getting a reasonable rate while he was working for me.