Archives for July 2013

Proposed Tax Code Reforms Could Harm Real Estate Recovery

According to the California Association of Realtors, in late June, the U. S. Senate announced plans to adopt a “blank slate” approach to reform the tax code.  A blank slate approach would eliminate all tax expenditures (including tax deductions such as the mortgage interest deduction, tax exemptions such as the capital gains exemptions on the sale of a personal residence, and the deduction of state property taxes).  Senators will have to request tax expenditures be added to the reform legislation, which would raise tax rates.  This approach allows the Senate Finance Committee to highlight just how much tax rates could be reduced by eliminating all the tax expenditures.  Senators have until July 26th to request that real estate expenditures be added to the reform legislation before the Finance Committee begins drafting a tax reform package.  What can you (we) do?  It is imperative that we have our voices heard and encourage Congress to “do no harm” to real estate.  Contact your representatives today.

Countdown to Home Buying

The market is improving; inventory is low.  Check this countdown list to make sure you are ready to purchase:

1.  Get Pre-approved.  You are pre-approved when your credit has been checked and confirmed and your income, assets and employment history have been verified.  Be careful; some so-called pre-approvals are not worth the paper they are written on.  I have received “pre-approval” letters from lenders and submitted them with offers to purchase only to find out later that the buyer was not able to obtain a loan.  Sometimes it is advantageous to work with loan officers at the bank with which you do business, as they have a vested interest in your continuing to do business with them.

2.  Temper your expectations.  Listing inventory in the Palos Verdes area and the entire South Bay is only 50% of what it was last year.  This means that if you want to stick to any sort of budget, you are not likely going to get everything you want or you will have to be patient.  Have a clear understanding of your needs, wants and wishes, so you will take action when the right home becomes available.

3.  Be ready to compete.  Unless you are willing to purchase a home an outlying area or in need of a lot of repairs, prepare yourself to make multiple offers and compete with other buyers in the market.

4.  Be prepared to act quickly.  When you find the home of your dreams, you need to be ready to rush to get it.  If you do not act quickly and start making preparations right away, you may find yourself left out in the cold when it comes time for your offer to be accepted.

5.  Watch your behavior at open houses.  Everything you do and say when in front of the listing agent (seller’s agent) or his representative will inevitably be shared with the seller and may come back to haunt you when your make an offer the purchase the home.  Both being too excited about the home or nit-picking the condition of the home can put you at a disadvantage at the negotiating table.

6.  Call your real estate agent.  Actually, this step should be first.  Contact me at 310-995-3754 or Katie@katiemuck.com as soon as you would like to begin the process!

Landlord-Tenant Relationships: Landlord’s Right to Entry

Note:  This post is intended to provide answers to general questions and the information was provided by our legal department.  Individuals should always seek the advice of an attorney regarding their specific situations.

According to the California Association of Realtors Residential Lease or Month-to-Month Rental Agreement, landlords are permitted to enter a tenant’s residential premises only under certain conditions, some of which require written or oral notice to the tenant and other obligations.  A tenant cannot waive any of the rights outlined below.

A landlord has the right to enter a dwelling under the following circumstances:

(1)  An emergency on the property

(2)  To make necessary/agreed upon repairs

(3)  To show the property to prospective or actual purchasers, tenants, lenders, appraisers or contractors

(4)  When the tenant has abandoned or surrendered the property

(5)  Pursuant to court order

Entry During Normal Business Hours: A landlord may only enter the premises during “normal business hours”- typically excluding evenings and weekends, with the exception of emergencies, abandonment or surrender by the tenant or a tenant’s consent at the time of entry.

Reasonable Notice: The default notice of entry requirement is 48-hour written notice.  Notice of entry by a landlord must be submitted, in writing, prior to entry.  A written notice should include the date, approximate time and purpose of entry.  However, if the landlord and tenant orally agree, that will be sufficient to permit entry for the purpose of agreed repairs/services, provided that they agree on the date and time of entry and that entry occurs within one week of the agreement.

Notice may be personally delivered to the tenant, mailed to the tenant six days prior to the intended entry, left with someone of “suitable age and discretion” at the property or left on, near, or under the entry door in such a manner that it could be discovered by a reasonable person.

24 Hour Notice: The landlord or landlord’s agent may show the tenant’s unit to a prospective or actual purchaser with 24 hour oral notice for 120 days after the landlord or his agent has provided the tenant with written notification that the property is for sale.  At the time of entry, the landlord or agent must leave a written confirmation of entry inside the premises.

Notice is NOT required in the following circumstances:

(1)  An emergency on the property

(2)  The tenant is present and consents to the entry at the time of entry

(3)  The tenant has abandoned or surrendered the unit