Sale and Eviction of Tenants in Income Properties

Although a landlord must normally give at least 60 days notice of termination of tenancy to a month to month tenant who has resided in the property for more than one year, a landlord can provide 30 days notice, if all of the following are true:

 (1) The rental unit can be sold separately from any other dwelling unit (e.g., a house or a condominium can be sold separately from another dwelling unit);

 (2) The owner has contracted to sell the dwelling or unit to a bona fide purchaser for value, and has opened escrow;

 (3) The purchaser is a natural person or persons;

 (4) The notice is given no more than 120 days after the escrow has been established;

 (5) A 30 day or 60 day notice was not previously given to the tenant;

 (6) The purchaser in good faith intends to reside in the property for at least one full year after the termination of the tenancy.

Civ. Code § 1946.1(d).

The notice must be personally served on the tenant or substitute served or served by posting and mailing, pursuant to Code of Civil Procedure section 1162.

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Full Service Protection

As a full service attorney-broker, Esquire Real Estate can advise you regarding tenants in your property to be sold and can assist you with legally and properly evicting the tenants, if necessary outside of court, at no extra cost to you.

New real estate law effective July 1. Sell with protection.

Section C.16. of the California Real Estate Transfer Disclosure Statement (TDS) now asks whether the Seller is aware of “Any lawsuits by or against the Seller threatening to or affecting this real property, claims for damages by the Seller pursuant to Section 910 or 914 threatening to or affecting this real property, claims for breach of warranty pursuant to Section 900 threatening to or affecting this real property, or claims for breach of an enhanced protection agreement pursuant to Section 903 threatening to or affecting this real property, including any lawsuits or claims for damages pursuant to Section 910 or 914 alleging a defect or deficiency in this real property or ‘common areas’ (facilities such as pools, tennis courts, walkways, or other areas co-owned in undivided interest with others).” (bolded portions effective as of July 1, 2014).

If the Seller is aware of such lawsuits or claims, the Seller must provide a further explanation in the TDS sufficient to advise the Buyer of the circumstances surrounding the claims or lawsuits.

Sell with Protection

Have an attorney-broker at Esquire Real Estate sell your real estate. Sell with protection. Esquire Real Estate is available to act as the sales broker as well as assist and advise you regarding the Seller’s obligations for disclosure in the TDS, the relevant claims or lawsuits referenced in the TDS, and the many other disclosure obligations in selling or buying California real estate. 

Get protected from common mistakes.

Top 7 Legal Mistakes Home Buyers & Agents Make

1. Not realizing that, without a confidentiality agreement, a seller need not treat your offer as confidential.

2. Not understanding when a contract becomes legally binding on the parties.

3. Failing to review the title record for liens, encumbrances, or other irregularities that will prevent the seller from closing escrow as scheduled.

4. Not understanding the legal implications and obligations under loan and inspection contingencies and other contractual provisions.

5. Not obtaining and reviewing a seller’s disclosures.

6. Not conducting your own inspections and investigations as the buyer.

7. Not fully considering the legal, tax, credit, and other ramifications of homeownership, especially co-ownership.

You can trust Esquire Real Estate to help you avoid legal mistakes and to properly advise and inform you of the legal challenges while purchasing California real estate. Give us your questions. 

If you know what 1031 exchange is, you will want to read this.

§ 1031 New Law

For any 1031 tax-deferred exchange that occurs on or after January 1, 2014, a California taxpayer selling a California property and acquiring a “like-kind” property located outside of California must file an information return with the California Franchise Tax Board (FTB) for that taxable year and every year thereafter in which the gain or loss from the exchange has not been recognized. If a taxpayer fails to file such information return and tax returns, the FTB may propose to assess the amount of tax, interest, and penalties due by estimating net income from any available information, including the amount of gain.  (AB 92 codified as Cal. Rev. & Tax Code § 24953)

For further information, please see the following PDF with analysis from PricewaterhouseCoopers: http://goo.gl/8W9iC0.

You can follow the FTB news and promulgated guidelines, procedures, and standards for implementing the new law on the FTB website for this new law: http://goo.gl/sh7fnS.

Takeaway

It is questionable whether the law will withstand judicial review, as it appears to unduly impose an additional burden on out-of-state exchanges and favors in-state exchanges.  However, in the meantime, be prepared to submit the information return and tax returns every year if you sell a California investment property and acquire a like-kind property outside of California.  Or, simply acquire another California like-kind property.  Esquire Real Estate is available to represent and advise you regarding your sale or purchase of investment property and 1031 exchanges.

Read the small print - OR - Hire an attorney to do it for you.

It’s doubtful that you have ever noticed the small font language at the bottom of every California Association of Realtors (CAR) form:

NO REPRESENTATION IS MADE AS TO THE LEGAL VALIDITY OR ACCURACY OF ANY PROVISION IN ANY SPECIFIC TRANSACTION.  A REAL ESTATE BROKER IS THE PERSON QUALIFIED TO ADVISE ON REAL ESTATE TRANSACTIONS.  IF YOU DESIRE LEGAL OR TAX ADVICE, CONSULT AN APPROPRIATE PROFESSIONAL.

Esquire Real Estate offers both the services of a real estate broker to advise on real estate transactions combined with the service of an attorney to advise on legal matters.  Some of the common areas where a real estate broker should defer to the expertise of an attorney include:

·      The legal impact of liens or encumbrances against the property.

·      The advisability of contractual provisions for liquidated damages, mediation, and arbitration.

·      How to hold title to your home or property.

·      Any items noted on a preliminary title report.

·      The legal impact of removal of contingencies and the earnest money deposit.

·      Legal interpretation of any real estate transaction documents, including loan documents.

·      The legal results of failing to comply with the terms of the purchase contract or to close escrow in a timely manner.

Your Solution

If you choose Esquire Real Estate to buy or sell your California property, you won’t need to consult (and pay for) another legal professional for your real estate transactions.  Choose Esquire Real Estate offering both a real estate attorney and real estate broker in one.