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Archive for November, 2018

Why Every Realtor Should Know About DSTs By – Don Meredith

Posted on 01. Nov, 2018 by .

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“Why didn’t my realtor know about this?”  At Tactical Income, Inc., we hear that question often when consulting on Delaware Statutory Trust (DST) investments for a 1031 exchange.  We heard this from a client inSan Diego with nine investment properties and serious medical problems who no longer had the time or energy to manage her properties but didn’t want to deal with property management companies and didn’t want to lose 30% in taxes right up front when selling her investment properties.  She chose to do a 1031 into several Delaware Statutory Trusts.  [...]

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Finally Another Landlord Victory By – Sheri Swist

Posted on 01. Nov, 2018 by .

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 Fourth Amendment Rights in the Context of SCEP

Inspections Restored to Landlords and Tenants!  [...]

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A Soft-Story Story: What’s Trust Got to Do with It? By – Dee Soffer

Posted on 01. Nov, 2018 by .

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Trust is a fragile gift – one that you must hold on to dearly and handle with the utmost care. We need trust in everything we do. It’s the component in life that when you have it, everything becomes possible.  It is the basis of healthy relationships; first cultivated with ourselves and then with everything that surrounds us. [...]

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San Diego’s Unique Triumph: Gleanings From a New York Times Best Seller by – TERRY MOORE, CCIM

Posted on 01. Nov, 2018 by .

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Harvard’s Edward Glaeser contends that cities are our species’ greatest invention. His readable volume explains why cities make us richer, smarter, greener, healthier, and happier. His book is Triumph of the City. Several of its major points highlight special strengths of San Diego.

First, take a look at some of what the research has revealed. Second, learn why San Diego exceeds many other metropolitan areas.

First, Consider 10 Major Themes: 

  • City’s greatest benefit comes from the ability to produce new thinking, to magnify our capacity. Humans are social species that excel in producing things together. Cities enable collaboration.
  • Urban workers earn 30 percent more than non-metropolitan workers
  • Americans in cities above two million are 50 percent more productive than people in smaller areas
  • Cities make it easier to find a spouse
  • Cities are greener than suburbs
  • Transportation technology shapes cities
  • Metro areas promote chance meetings of smart people and accidental insights
  • Cities attract poor folks because it is their best chance to escape poverty
  • Metro areas enable poor kids to become rich. Rural poor lack that opportunity
  • 22 metros generate the majority ofU.S.income. Glaeser argues that art, business, education, finance, and science all advanced further and faster in cities than in rural settings

Second, Examine 9 Characteristics

Which Especially Benefit San Diego 

  • Cities thrive when they have many small firms and skilled workers. San Diego has a higher percentage of smaller firms than most otherU.S.metros. Our smaller firms mean there is more competition. Just as runners run faster when the competition is near, it also encourages marketplace performance. Big firms and unskilled workers do not fare well. Our economic diversity is more robust than manufacturing monocultures, like Detroit.
  • Young people bring energy and dynamism to communities. We have the third highest percentage of millennials. When their population share increases one more percent, San Diego will pass Austin and became the metro with the highest percentage of millennials. Related to our competitive advantage, young adults in particular work longer when they know a competitor is near.
  • Cities have long created intellectual explosions, in which one smart idea generates others. The Bay Area has their Pay Pal Mafia”, serial entrepreneurs who have generated scores of business successes. UCSD is our bio-tech catalyst.
  • Successful cities attract smart, entrepreneurial people. Bright students and affluent vacationers want to stay in, or move to, San Diego.
  • San Diego is America’s greenest city. It has 20 percent of the per capita energy footprint ofChina’s industrial city of Daqing, their oil capital.
  • Educated people move for quality of life. San Diego is more attractive than other desirable areas; warmer than Boston winters and cooler than Austin summers.
  • Education is the second most important predictor of urban growth. The greater percentage of college educated people, the higher the average income. We export education to the world.
  • Most successful cities connect continents. Open cities can’t exist in closed nations. Immigration is crucial to urban success. San Diego borders Mexico and is a gateway to thePacific Rim.
  • Diversity, education and immigration promote astounding economic growth.CityHeightsis a nationally recognized example of first generation Americans becoming drivers of economic success.

Triumph of the City devotes 25% of its content to documenting its claims. Glaeser touches on many other aspects regarding cities, including arguing that the suburban ecologists have it backwards. He shows how NIMBYs lock local development and, in effect, push growth into Houston, Las Vegas and Pheonix –  cities with higher energy and ecological costs. If these 700 words whet your appetite, invest a few hours in the full volume.

Alternately, if you want to know which zip codes can provide superior opportunities, contact me.

 Terry Moore, CCIM is an intellectual scout for his clients. He’ll read 50 non-fiction books this year to help his clients make the most important financial choice of their next decade. He is part owner of Apartment Consultants Inc. He is among the county’s most active income property brokers. Reach him at 619-889-1031, tmoore1031@gmail.com or SanDiegoApartmentBroker.com.

 

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Something to Think About #74, Part 37 by – Klarise Yahya

Posted on 01. Nov, 2018 by .

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If you’ve missed some of the basic articles, guidelines on successful investing are in my book “Stairway to Wealth” available at LuLu.com.

Continued from Part 36: Wrong! Capitalizing “Forecast” Rents [...]

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Proposition 10 Goes Down in Flames! By – Jon Coupal, President of Howard Jarvis Taxpayers Association

Posted on 01. Nov, 2018 by .

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This [month], Californians saw several taxpayer threats on the ballot, not the least of which was Proposition 10, titled “Local Rent Control Initiative.” This measure would have opened the floodgates to big government bureaucracies, burdensome regulations and a loss of property rights. [...]

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Important News for Investment Real Estate Owners By – Dwight Kay and the Kay Properties Team

Posted on 01. Nov, 2018 by .

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A 1031 exchange is considered by many to be the most effective tax deferral tool available. Under IRS code section 1031, investment real estate owners are able to defer the capital gain tax on the sale of appreciated investment property if they reinvest in “like-kind” property.  Real estate held for business or investment purposes can qualify as “like-kind” property. This includes single-family rentals, apartment complexes, office buildings, storage facilities, industrial buildings and many other types of commercial properties. [...]

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Management Tips From MRLANDLORD.COM By Jeff Taylor, “Mr. Landlord”

Posted on 01. Nov, 2018 by .

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10 Ways to Verify Truthfulness of an Application

(Before Even Running a Credit Check)  [...]

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Winter’s Coming: Is Your Property Rain-Ready? By – Kevin Stamm

Posted on 01. Nov, 2018 by .

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November brings more than just an increased burden for letter carriers; it’s the start of our rainy season. Is your property ready? From top down, here are some areas to check.

Roof

Have a flat roof? What happens if its sole roof drain outlet gets clogged? Make sure it’s open and water can escape. Clear the roof and gutter of anything that may clog outlets. If you plan to re-roof, consider adding an emergency overflow outlet. If you have rain gutters, clean them out and run water through to make sure they’re clear.

  • Don’t forget to check the light-well roof.
  • If your roof leaked last year, did you get it fixed? If you see any seams opening up in the roof membrane, call a roofer experienced with your type of roof, and have it repaired. Rusty, deteriorating flashing, gaps around roof penetrations and pipes will leak. If your roof “ponds,” repair it or consider re-roofing. If you have a pitched roof with missing shingles, replace them.
  • Don’t forget: wood or tiled decks over living spaces have roofs, too. Consider plugging up the drain and doing a flood test to see if anything comes out underneath. Better to find out now when you can control the “rain” than when you’re on that long winter vacation.

 Walls

  • All wall systems leak. What’s supposed to keep the building from rotting out is the weather-resistive barrier (WRB) beneath the siding. Like roofs, walls too need to drain. That’s why you never want to caulk the bottom of lap siding, especially siding near the ground that sits up against the foundation. Make sure the water that gets behind the siding has a means to exit. Intelligent use of the caulking gun keeps water out where it can come in but not where it needs to leave! Remember, it dries or it dies.
  • Inspect any weep holes, (small openings that allow water to drain from within an assembly), for example, horizontal sliding windows. Such windows travel in a track that collects water that must be allowed to exit. The track is readily visible in older aluminum windows, but usually has a removable cover on newer vinyl windows. Look at the exterior window frame underneath the sashes (the part of the window that moves). There should be little flaps covering these weep holes. Dump some water in the track and make sure it can get out the weep holes – easy to do on aluminum windows but trickier on vinyl. Another overlooked weep system is metal door thresholds with a water-return feature. Remember: if it was designed to drain, make sure it can. If the door has damaged weather stripping, replace it.

Window Sills and Frames

  • The sill and corners of windows are most vulnerable to dry rot, and, poorly maintained, provide access points for water that leads to rot in wall structural members. Check where the window sill meets the jambs, and make sure they are sealed together.

Infrastructure

  • Wood fences usually succumb to gravity in the rainy season. The wood gets wet, making it heavier and weaker; the soil gets saturated and less supporting. A storm blows in and your fence collapses. If your old fence looks questionable, fix it now. The same goes for that leaning or cracked retaining wall.
  • Attachments: take a close look at items attached to your house, such as satellite dishes, antennas, etc. Could a strong wind blow them over and through one of your neighbor’s expensive windows?
  • With rain comes cold. If you have a newer high-efficiency condensing gas-fueled furnace, make sure the condensate neutralizer filter has material in it so that it isn’t sending acidic water into your plumbing system that will eventually corrode your pipes. While this is not a definitive list of items to consider in preparing your property for the rains, it lists among the most important ones.

Following these tips will go a long way toward ensuring that your property won’t be caught in the rain without its raincoat on.

 Kevin Stamm is a licensed building contractor “spending the rest of his days getting his San Francisco home ready for any eventuality.” He may be reached at (415) 647-8517 or kevinstamm@earthlink.net.

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Legal Q & A by Richard Beckman

Posted on 01. Nov, 2018 by .

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Question 1:  I missed the AOA seminar on the upcoming Costa Hawkins/Proposition 10 vote. Can you summarize what I missed?

Answer 1: Yes. In a nutshell, the Costa-Hawkins Rental Housing Act law was passed in 1995, and was designed to do three primary things. First, it eliminated what is known as “vacancy control, “which is a form of rent control practiced most notoriously in Berkeley, and which allowed the rent control board to set the rent on a unit which had been voluntarily vacated by the prior tenants. This sort of administrative control over income property was too much for the California legislature and was generally considered the incentive for the Costa Hawkins legislation. [...]

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