3 Real Estate Laws Every Investor Should Know for 2021
If you want to stay up to date on new laws, rules, and regulations that may affect property investors and landlords, the first thing you should do is contact highly regulated states.
In this case, it’s none other than California, a state that has passed new laws for 2021. Guess who these laws favor the most? If you were to guess tenants at the expense of landlords and government at the expense of private companies, you’d be right. Here are two laws from this state and one federal regulation to keep an eye on.
1. The house you bought at auction could be torn away
California passed Senate Bill 1079 in bill that puts investors who do the work to acquire a good foreclosure business at risk of losing that acquisition. This bill would give tenants living in a home bought at auction 45 days to round up cash, including getting a mortgage to buy back the home at the price the investor paid.
So an investor puts together a deal for a house, makes an offer, wins the offer and buys the property. That should be the end of the story. But this new law means that the deal you just made may not be honored. You may have to go without what you just bought. In addition, you would need to inform the tenant of their right to buy the home from you for what you paid.
The Rationale: Senator Nancy Skinner, D-Berkeley, told investors, “The homes in California are not yours to devour.”
The bill also prohibits the sale of foreclosed properties in bundles. Bidders must bid individually.
2. HOAs need to allow more tenants
One move that will help landlords with long-term rentals but potentially impact the short-term rental business and get into the business of private homeowners’ associations (HOAs) is Bill 3182.
This California law requires HOAs to allow at least 25% of the homes in the neighborhood as rental properties. This prevents HOAs from being able to decide for themselves whether and how many they want to rent at all.
The law allows HOAs to prohibit short-term rentals of 30 days or less, such as: B. Airbnb types (NASDAQ: ABNB).
3. The eviction moratorium rages on
The Centers for Disease Control and Prevention (CDC) – a health protection agency – stepped onto the landlord arena in September 2020 when they ordered the cessation of evacuation of residential buildings, a move a Texas judge has since ruled unconstitutional.
The CDC says this edict is supposed to stop the spread of the coronavirus – one reason for everything these days. And this “temporary” eviction ban, which takes away the most basic refuge of a landlord, is constantly being expanded. From now on, landlords can only vacate on March 31, 2021.
The bottom line of Millionacres
Even if certain laws don’t apply to you, it’s a good idea to keep up with them anyway. That way, you won’t go blind when lawmakers are trying to pass laws that could affect your business. Joining a local investor or rental group can help ensure your preferences are heard and your rights as a private business owner protected.