Property sellers and real estate professionals face a tough decision about disclosures when selling a stigmatized property.
A property is stigmatized when buyers find it undesirable due to emotional or psychological reasons. Conditions that might stigmatize a property are:
When a property is stigmatized, it can be much more difficult to sell. It can take up to 25% longer to sell and have a lower sales price than similar properties. Therefore, it is usually in the seller’s best interest to keep conditions that might cause the property to be stigmatized under wraps. Fortunately, Nevada law does not require disclosure of anything about a property that is not material to its condition.
In Nevada, Sellers generally do not have to disclose murders, suicides or deaths that occurred inside the property, paranormal activity, or criminal activity that took place inside the property. The only exception to Nevada’s non-disclosure law is if the property’s condition caused someone’s death. Further, they must disclose if methamphetamines have been produced at the property unless the Board of Health has certified that the house is safe for habitation. However, the Seller and Real Estate Agent should not like about any of these issues if directly asked.
Although Sellers are not required to make disclosures about stigmatized property except under specific circumstances, occasionally disclosure is in the seller’s best interest. If a buyer is likely to discover the stigmatizing condition, it may be better for the seller to disclose the condition upfront to avoid surprises that might derail the sale. A Nevada real estate lawyer can answer questions about what disclosures they must make or what conditions they should disclose.
Purchasing a home in the current Nevada housing market is challenging. However, with the possibility of stabilizing prices, it may be time for mortgage-backed buyers to make their move.
The housing market in Nevada has been on a wild ride for the last year, with housing prices rising more than 21%. Real estate experts attribute the increase in prices to different factors, such as cash buyers and an influx of new residents. Experienced real estate agents in the state have reported an increase in all-cash buyers. These cash offers make it difficult for traditional mortgage-backed buyers to purchase a home because cash buyers can move faster, waive inspections, and offer above listing prices.
Real estate experts have cited the COVID-19 pandemic as an impetus for people moving to Nevada. The increase in remote work positions due to the pandemic has allowed people to move to areas with a lower cost of living. People have realized that they can move to Nevada from New York, Chicago, California, and Florida, buy more houses for less money, and have a substantially lower cost of living.
However, wealthy investors looking to purchase houses for the rental market are likely behind most of the cash-only purchases. Some individuals are buying additional homes to increase their share of the rental market. However, statistics show that corporations are purchasing large swaths of homes to rent them out. These corporations are betting that increasing home prices will result in increased rental demand.
These investors are not wrong. As of July 2021, the median home price in Reno was $530,000. Realtors report that many homebuyers seeking to break into the housing market have decided to delay their home search after getting consistently outbid by cash buyers, increasing the rental market.
It appears, however, that the housing market in Nevada may be stabilizing. The median home price in Las Vegas has held steady at $405,000 for two months. Further, real estate experts claim that the housing market will begin to plateau because it is unsustainable for the median home price to continue outpacing the median wage.
With signs pointing to a cooling Nevada housing market, now may be the time for mortgage-backed buyers to find their homes. However, buyers should still be prepared for stiff competition. Finding an experienced realtor and real estate attorney may help make the process smoother.
The hot real estate market and fear of missing out shouldn’t cause homebuyers to overlook red flags during the home-buying process. This could cause serious headaches in the future. Missing warning signs that are obviously present could impact future legal rights when filing a potential lawsuit.
The home inspection is a buyer’s best friend when buying a home. Buyers desperate to buy a home are more frequently either waiving the inspection or paying less attention. This is a big mistake. Buyers will usually have to pay for repairs when they discover problems after they buy a home, unless the seller tried to hide the defects.
Some of the biggest things to check are a home’s foundation and the integrity of the wood. Things such as moisture, termites, and carpenter ants can impact wood, causing it to rot over time. This is very expensive to replace. Rotting wood that is readily apparent is often a sign of more serious problems. This problem can occur inside and outside of the home. Cracks in the foundation can make a home structurally unsafe and require major work to remedy. A Buyer sure to hire an experienced and thorough home inspector, including one that can do a pest inspection, to help with the Buyer’s due diligence.
In general, buyers should be vigilant about moisture. Water is one of the biggest enemies of a homeowner, causing massive repair bills. Buyers should pay close attention to whether there are water spots on the floors and/or ceilings, as these are signs of leaks. Water will damage floors and wood, and can eventually cause a severe mold problem. A small leak today can become a major flood in the future. Again, a good home inspector should help a Buyer discover potential signs of water damage, including past or active leaks.
In addition, Buyers should look at the quality of workmanship in the home. Some sellers may attempt DIY repairs before selling a home to give the appearance that the home is in good condition. However, they may lack sufficient expertise to do a good job on these repairs. Shoddy workmanship is a sign that the homeowner may be doing quick work to cover up problems that are far worse. Also showing what buyers can expect elsewhere in the home.
Buyers should be reluctant to sign “AS-IS” provisions, or at the very least, should have a real estate lawyer review the provision before it is executed. Certain language in this type of provision could have negative implications for a Buyer’s claim against not only the Seller but potentially other third parties. A Buyer needs to clearly understand the consequences of signing an “AS-IS” provision before moving forward.
Buyers who have issues with defects that they discovered after buying the home can contact a real estate lawyer. They may be able to file a lawsuit against the seller or builder of the home depending upon the factual circumstances.
A real estate contract is a binding document that obligates both parties to its terms, and great care must be taken when drafting it. Any imprecise terms or sloppy drafting could come back to haunt one or both of the parties, especially the one who drafted it. One way to avoid the risks of a contractual mistake or oversight is to hire a real estate lawyer to review all terms.
There is no such thing as a typical real estate contract. Each transaction has its own terms that are negotiated by the buyer and seller. For example, there could be repairs that need to be made, and the contract will specify who is responsible for them.
Every deal may have its own contingencies, and these need to be spelled out in the agreement. Otherwise, parties will not have the contractual protections necessary for their situation. Someone should closely review the contract, both as it is drafted, and before it is signed. After the real estate deal is closed, the parties lose the legal right to change the contract, and a judge will enforce what is written and interpret any ambiguities.
Everything should be in writing and included in the contract itself. Text messages, verbal conversations and emails that include negotiations but that do not expressly make it into the contract will likely be deemed unenforceable.
One important contingency is the inspection process. This is often what can hold up the deal and cause disputes between the seller and buyer. The reason why this is a contingency is that the buyer has the ability to walk away from the deal if the property cannot “pass” an inspection. Another common contingency gives the buyer an out if they cannot obtain the financing to buy the property.
In addition, the contract should clearly specify what is included in the sale. The seller may wish to include some personal property items as part of the sale. The contract should exclude what the seller wants to retain, so the buyer does not expect to take possession of these when the deal closes. Otherwise, the buyer may be entitled to them as part of the transaction. All important material terms should be included.
Perhaps the most important part of the real estate sales contract is the provision that covers what happens when one of the parties does not live up to their obligations under the contract. This will give the other party the legal right to enforce the contract and penalize the other side when they have breached the terms. Parties need to watch out for provisions that might waive their right to a jury trial and it is important to include prevailing party provisions so there is an ability to recover attorneys fees and costs if a dispute arises. It is also important to understand liquidated damages provisions before you sign. Having a real estate attorney review a contract before execution may save time, money, and heartache for the parties later down the line.
Reno home prices are going up, and the short-term prediction is that this will continue for the foreseeable future, However, some factors could stop increasing prices in the longer term. In the meantime, buyers should expect tight supply and multiple bids on each property.
The story in Reno is much the same as the rest of the country. Historically low interest rates and short supply are combining to light a fire under the real estate market. The few homes that are on the market are available only to the bidders who manage to beat out everyone else. This freezes some potential buyers out of the market.
Many homeowners have stayed put because of the pandemic. Some people have put off moves because of the uncertainty of how their lives will unfold in the future. Others need to relocate, but there is not an available supply of homes. Even as the pandemic begins to recede, the housing market still seems in flux.
The low interest rates mean that buyers can afford more houses for their money. Currently, mortgage rates are just above record lows, stretching homebuyers’ budgets. This often emboldens them in a bidding war. The result is that prices keep running away from the average buyer. This may stop when mortgage rates invariably head higher, so buyers need to be cautious, lest they end up in a repeat of the Great Recession housing bust.
The pandemic’s housing effects are far more magnified in Reno. Some buyers can move practically anywhere in the country and still keep their jobs, and Reno is one of the most desirable destinations. Housing prices are up over 20% year-over-year. While Reno has become expensive and has priced out many buyers, it is still less expensive than some metro areas in the neighboring state of California. Families from California may be able to cut their housing expenses by moving to Reno, leaving some locals priced out of the market.
People are coming to Reno from all over the country, and that has put the market into a frenzy. In fact, there appears to be a great migration of people from large cities to more rural areas. While buyers need to be careful about paying too much, they must be prepared to pay up if they want a home in Reno. In the meantime, there is little relief from high prices for prospective buyers in the real estate market.
Available residential real estate has dropped to record low levels in Reno and many parts of the country. As the pandemic drags on, an increasing number of buyers are seeking homes in areas such as Reno-Sparks, which offer fresh air, plenty of space, and a quieter way of life. It is most certainly a sellers’ market for the time being.
As of February, there were only 165 homes on the market in the Reno-Sparks area. This is a decrease of 73% from last February’s 621. Further, the median sales price has increased nearly 11%. Both of these data points highlight the advantages in favor of sellers, but also present difficulties that buyers need to overcome.
Inventory is low, prices are rising, and buyers are motivated to move. It is a perfect storm of conditions that all favor sellers. Across the country in communities with similar conditions as those around Reno-Sparks, this means sellers are receiving bids far above the listing price. In some cases, sellers are receiving dozens of offers, many sight unseen, within days of listing the property. For sellers, it is not a matter of waiting for offers; it is a matter of choosing which offer comes with the best price and the fewest contingencies.
Home construction remains sluggish across the country. Production of construction materials is down, the global supply chain is still wounded, and rolling lockdowns have made it increasingly challenging to build new homes at a fast pace. It may take several years for new construction to absorb the increased demand for additional housing in areas such as Reno-Sparks. However, it may take longer as vaccination rates rise and an increasing number of buyers seek to relocate from congested cities into more relaxed and less densely populated regions.
Naturally, prices have risen and this is reflected in the sold-to-list price ratios in the region. During the first quarter last year, the average listing price was $420,000. By the end of fourth quarter, it rose to just under $450,000. Moreover, around 99% of sellers are receiving their asking price or higher. It’s a trend that will no doubt continue throughout the year as Reno’s star continues its rapid rise as a comfortable, quiet, and fun place to work, play, and raise a family.
Due to the high number of offers being submitted and quick closings, it is important to carefully review the terms of your contractual sale documents and it may be wise to have an attorney review, should you have any questions. The attorneys at Maddox, Segerblom & Canepa, LLP are here to help.
While governmental bodies may use eminent domain to seize land for the public’s benefit, property owners may file inverse condemnation actions when they do not receive just compensation for the land that is taken. Landowners must receive fair compensation from the government whenever their property is seized through eminent domain processes. While eminent domain is initiated by the government, inverse condemnation is initiated by property owners who have not been fairly compensated for the land that has been seized.
Property owners enjoy constitutional rights against seizures of their property by the government under the Fifth Amendment of the U.S. Constitution. However, eminent domain has been recognized as an exception to this right under both federal and Nevada state law. Nevada has established laws about when the government can exercise eminent domain to seize property and how the process works. The government can seize property to use for the public’s benefit. However, it must fairly compensate property owners for the property that is taken. When property owners do not receive reasonable compensation from the government for their seized land, they may file inverse condemnation actions.
Inverse condemnation refers to a legal process by which landowners may sue the government for fair compensation for the lands that they have lost. This action may be filed when the government seizes a portion of property outright or when its actions result in an effective seizure of a portion or all of a piece of property. For example, if a government redirects a waterway in such a way that it causes a landowner’s property to flood, it could be considered an effective seizure of the landowner’s property. Inverse condemnation actions provide a way for landowners to recover the compensation they should receive for the loss of use or ownership rights of the affected land.
To prove an inverse condemnation claim in Nevada, property owners are required to show several things. They must prove that taking of the land and their real or personal interests in it occurred. They must also show that the land was seized for the public’s use without receiving just compensation. The seizure must have been proximately caused by the actions of a governmental agency in the absence of formal eminent domain procedures. Inverse condemnation actions can be complex because of the types of evidence that may be needed to prove these elements.
Nevada residential and commercial property owners that learn that the city, county, or state government might seize their property through eminent domain should take steps to protect their interests and rights. In the early phases of planning, it is possible to fight land grabs and rezoning. However, losing the property might become an inevitable outcome. When that is the case, people should know how to protect their rights to receive fair compensation by negotiating favorable terms.
City, county, and state governments use eminent domain to convert private property to public use. When eminent domain actions succeed, private property owners are required to surrender portions of their property or entire parcels for uses deemed to be in the public interest. Some examples of when the government might initiate an eminent domain action include the following:
While governmental entities can seize property through Nevada’s eminent domain laws, property owners are entitled to compensation for their land. Negotiations can help landowners secure fair compensation for their land.
Developers may submit proposals requesting the rezoning of specific areas to support commercial uses or higher-density housing for their projects. Residential and commercial property owners who will be impacted by the proposal can object to the plans and ask for mitigation for problems like increased pollution and traffic.
In some cases, it will be impossible to save a property from rezoning or eminent domain actions. When surrender is inevitable, fighting for just compensation might allow property owners to receive compensation for the fair market value of the land that they will lose. To ensure that property owners receive an appropriate amount of compensation, they will need to have proper appraisals completed with the most current maps.
Property developers might need to rely on eminent domain actions and rezoning efforts to repurpose properties for other uses. These types of proposals commonly receive stiff opposition. Developers must be prepared to present their plans in a careful and thorough way to zoning boards and commissions so that they can show their benefits to the city or county where the developments will be located. Developers may need to survey owners and negotiate surrenders in advance. This can make succeeding with a rezoning or eminent domain action likelier.
Changes to Nevada eviction law passed in 2019 impacting the process of eviction between landlords and tenants. The law presented new requirements that landlords must adhere to during the eviction process. Landlords are now required to use licensed process servers to serve tenants with notices of eviction. A landlord also cannot charge his or her tenants more than 5% of the balances owed when tenants are late with rent payments. Tenants who receive eviction notices must be given seven judicial days to either move from the property or pay the past due rent.
In the past, landlords were allowed to serve eviction notices to tenants personally. However, under the change in law, residential landlords are required to have attorneys, sheriffs, constables, or licensed process servers serve eviction notices. Proof of service must be filed with the Court. While this might seem to be onerous, requiring eviction notices to be served by licensed process servers can be helpful to both landlords and tenants. The new requirement helps to ensure adequate service and lessens the chance of a tenant later arguing that they were not given adequate notice of eviction proceedings.
For tenants who receive eviction notices for failing to pay rent, seven judicial days to pay what is owed or to relocate is allowed. Tenants who receive 24-hour lockout notices must be given a minimum of 24 hours before he or she is locked out. Previously, the sheriff or constable could show up to remove evicted tenants during the 24-hour lockout period. Now, however, authorities are required to wait the full 24 hours. As previously required, a landlord must store belongings of an evicted tenant for 30 days and allow reasonable access to the personal property. The changes in law, however, now allows a tenant to dispute the landlord’s inventory of the property within 20 days of lockout, vacancy, or inventory list, whichever is latest. A tenant is now also allowed to file a motion expedited action on retrieving personal property after an eviction.
Another major change applies to late fees that can be charged by residential landlords to tenants who are late on paying rent. In the past, landlords could charge a “reasonable” late fee. However, what was reasonable was not defined and was often left to the Court’s discretion. The 2019 change in law establishes a limit on the fees allowed. Landlords can no longer charge more than 5% of the balance of the late payment as a fee.
These changes are important for both landlords and tenants alike to be aware of going forward.
Disclaimer: The standard eviction process and requirements as described herein may not apply during the time of an eviction moratorium.
Small condo association management in Nevada poses unique challenges because of fewer resources, but it can be done successfully by following a few tips. When condo associations have fewer members, they have fewer dues to support the work of the homeowners association and to improve the community for everyone. Managers can take several steps to improve efficiency and to make the HOA successful and responsive to the needs of the individual owners.
One challenge that managers of small condo associations face is raising money. They must be careful with how much they charge residents. They should avoid charging excessive fees because that could deter others from purchasing properties within the community. If a fee increase is projected, residents should be promptly notified so that they can make budgetary adjustments.
Decisions that are made affect the condo association’s members. Managers should listen to members and allow them to provide input. While managers do not have to take every suggestion, listening can help the members feel valued. Transparency and communication are key to successfully managing a small condo association. The members are likely to be happier when they know what decisions are being made and the reasons for them.
Trying to balance a small condo association’s budgets with the desired services can be challenging. Board members must have realistic discussions and take care to not overspend. They should also prioritize repairs and upkeep instead of putting them off. Condo boards should analyze the likely costs that the repairs might require if they are left to the future and allowed to deteriorate further. Without spending on repairs, the future costs may strain the condo association’s budget even further. Managers should carefully research costs and bids before moving forward.
While small condo associations may rely on the help that volunteers can offer, they should not place too many expectations on residents who agree to step up and contribute. Managers should remember that the residents already have to balance their careers and lives. They should not pile too much volunteer work on residents who may already be stretched thin.
Good organization is critical for efficiently managing a condo association. Boards and managers should keep meticulous records about everything that happens, including meetings, finances, and decision-making processes.