All Forum Posts by: William Hochstedler

Trusts, such as a land trust, will provide anonymity because the only name on public record is the trustee.

There are services out there that specialize in this for not a lot of money.

Make sure you are getting good legal advice before putting a lot of assets into a trust so you understand the various structures and jurisdictions. 

Keep talking to lenders.

The Utah Housing loans are just down payment assistance programs packaged together with FHA loans. I'm not sure if it can be uncoupled without a refi. But I'm not aware of any loan program that requires you to sell or refinance if you can no longer live there after one year of occupancy.

Most likely you will not be able to use the Utah Housing assistance again. But there are plenty of other high LTV programs out there.

Right?  Here is the link to their methodology.  They simply are computing a trend line for each market ("using open-source data from third-party housing data providers") and then calculating the deviation from the trend.  Apparently if a market appreciates faster than it's long-term historical appreciation, then it's overpriced according to these folks. They don't get into any of the other factors that you mention.

So this list basically underscores a national trend of strong growth in the mountain states and people moving to warmer climates.  Add to that a few rust belt cities where real estate was almost free 10-12 years ago.  No fancy math needed.

Contractors have been stiffed by owners and owners have been stiffed by contractors.

I only pay anything up front if the contractor can give me a W-9, liability insurance certificate, proof of trade licensure, and workers comp cert.  This means they're a real business and not some fly-by-night crack heads.

If the latter are giving me a screaming deal and might be worth working with, I buy the materials and only pay them their labor and profit after a milestone is completed to my satisfaction and that I know I won't have to redo it.  This way the contractor has no hard carrying costs.

Make sure you have a way of verifying that they've done the work satisfactorily.  If you don't know what to look for when signing off on a phase, make sure you have a trusted resource to come give it a set of eyeballs.  The barrier to licensure is way too easy these days and there are a lot of fully licensed hacks out there.

In this market, if a contractor is available to work in less than 2-3 weeks and they're inexpensive, start looking for the fish you smell.  No one who's any good at what they do is readily available right now.

For $1000, I'd go straight to small claims.  Going after their reputation or license (if they have one) won't do anything.  Did you check the BBB or state licensing board before you hired them?  If they did no work and won't refund your $1000, what is their defense?  Most likely they will be a no-show and you'll get a default judgement...that will also be worth nothing.  If they do respond to the summons, a company worried about it's reputation should try to settle so it won't impact it's reputation or legal standing.  This way you'll be done with it and you can move on with your life (and landscaping).

Good luck!

Landlords are required to provide 24 hour notice per section (2) below.  Section (9) suggests that you don't have much recourse though.  If they don't provide notice, however, they may be trespassing.

Landlords (and real estate agents) really frustrate their ability to sell by not cooperating with the tenants.  This is not hard.  There is technology like Matterport, where a prospective buyer can have a virtual tour of the property any time they want.  In most cases, we schedule a convenient time with the tenant to video the home and then don't show the place until there's an accepted offer.

You may suggest something like this to the landlord because there's probably nothing in your lease that says that the unit or house has to be presentable at any time for perspective buyers.  You could have the place look great for a video shoot, if they agree to no showings (or one or two "open house" showing brackets) until they are under contract.

And yes, you get to stay there through the end of your lease in December.  Lease obligations transfer with the property.

Good luck!

Effective 5/5/2021
57-22-4. Owner's duties.

I think a real estate license is an invaluable asset for an investor.

Every experienced investor must have a good team of real estate professionals to have their deals go smoothly. Most have at least one go-to agent or have a license themselves. If you are active with your investing, having access to the MLS is critical. You also can't collect buyer side commissions without a license. A single transaction will more than pay for the costs of maintaining a license.

As far as the licensing process teaching you about investing, most of the other responses are correct.  You don't learn much about investing in pre-licensing education or at regular trainings in typical brokerages.  But real estate law is state specific and affiliating with a broker who has investment experience is the best guidance you can get.  Broker's are required to provide adequate supervision.  This means that they have to answer any questions about what you're trying to do.  A good broker will be able to show you how to do wholesaling (legally), seller financing, and other more sophisticated transactions.  And they absorb liability on these deals if you are following their guidance.

Moreover, getting a license and affiliating with a brokerage exposes you to deal flow.  I've had a lot of deals killed by Realtors.  But I've also had a bunch handed to me because I was the investor in the office when someone got a listing with a hoarder house (or worse).  The only thing that having a license complicates is the disclosure that you are a licensed agent when soliciting deals.  For some big wholesalers/marketers, this requirement creates too much friction.

But having a legal framework--knowledge of laws and access to forms--and an experienced broker are both assets for any investor.  You just need to find a broker who is knowledgeable and comfortable with investing and brokerage where the fee structures make sense.

There's always going to be real estate agent bashers in investment circles.  But I think you'd be surprised how many investors have or have had licenses at some point in their career.

For a solid investment strategy you should have a good knowledge of 2 of these 3 things:

   --Partners

   --Market

   --Asset Class

So I would suggest that getting started in an industry in an unknown market without serious trusted connections is a recipe for failure.

Have you sued for performance against buyers?  And have you ever been successful?

I've asked attorneys about suing buyers for performance over the years and no one has ever seen it (in Utah).  

It doesn't make sense from a cost benefit standpoint, because the buyer may not be capable of buying the property which is now unsellable to anyone else because of a protracted legal situation. In short, it's very expensive and a lot of risk for the seller. This property would have to be completely unsellable at any price to anyone else on earth for it to be a reasonable case to pursue.

However, the I would think that the seller could probably also sue for actual damages which they would need to demonstrate. This could include cost of time on market and the difference in sales price if they had to sell it for less than your contract price. Again, the damages have to be pretty great for this to make sense. Or, if damages are only a few thousand, they may be able to pursue you in small claims up to that limit. But for large damages, they have to be very confident that they would prevail and the damages would have to be much more than associated legal fees to make it a good bet. I've been told that damages between $10K and $100K are the hardest because they are too big for small claims and too small to justify the legal fees and risk.  

@Archer Stone You should definitely review the specifics of the transaction with a Florida attorney like Chris who will have a better sense of case law etc.  

@Archer Stone

I just received a press release from Idaho Realtors that I thought was interesting...

FOR IMMEDIATE RELEASE

IDAHO REALTORS® FILES SUIT TO PROTECT PRIVATE PROPERTY RIGHTS IN LAVA HOT SPRINGS (Lava Hot Springs, Idaho) – Idaho REALTORS® has filed suit against the city of Lava Hot Springs to defend the rights of private property owners and their ability to reasonably and responsibly offer short-term rentals.

Utilizing the association’s legal defense fund, IR will support [property owners] in a lawsuit against the city of Lava Hot Springs for its denial of their license for a short-term rental property. IR is seeking a declaratory judgment invalidating Lava Hot Springs zoning restrictions on short-term rentals. During the November 11, 2021 Lava Hot Springs city council meeting, the council voted to deny the [owners’] short-term rental license on the grounds that his property is located outside of the city’s commercial zone. This action ignored protections in Title 67-6539 of Idaho Code, which requires that all short-term rentals be classified as residential land use, regardless of the city or county that they are located in.

Owners ... should be afforded the same private property rights across Idaho, and Idaho REALTORS® will always work to defend private property rights.

Never sell unless you have a better opportunity that requires it.

With the kind of equity you have, you should be able to get a non-occupant HELOC at 75-80% LTV. (If you search here on BP you can find lists of banks that offer these). That means that you can access at least another $75K for your current project that way.

A couple of side notes:

• Others may disagree, but I recommend against shorter term amortizations on properties where you can get good 30 year fixed rates (1-4 unit residential properties). Here's why: 1) Equity in investment properties is hard and costly to tap into (in the HELOC example above you only have access to 80% of it.) 2) A few extra hundred dollars a month now can be reinvested in the property to increase performance and income faster than the interest you save. 3) Your return on equity declines faster meaning you are making less income as a percentage of your net worth. 4) And if you want to extinguish your mortgage faster, you can always pay additional principal. But if you run across hard times, you can't pay less on a 15 yr am. Certainly take advantage of lower interest rates and shorter length mortgages on your primary residence so you can more quickly get to debt free. But leverage is your friend in real estate, particularly when you're in growth mode.
• Double check with those city codes, the government can't deprive you of a legally established existing use without compensation.  It is usually only if you abandon the use (duplex) voluntarily that you become restricted from rebuilding it's non-conforming use.  Most municipalities allow you to repair damage from natural disasters to it's current use and total destruction falls into that category.

Good luck!