Buying short-sale properties could be a great way to get into property investment, but there are a few risks that come along with these types of purchases. Learn more about what to look out for!
TLDR: Find out about hidden costs before purchasing an investment short sale home. Get a home inspection. Do your own investigation about the neighborhood and land. Prepare for delays while closing.
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As with many areas in the United States, rental demand continues to climb in Berkeley, CA. The latest data from the Federal Reserve suggests that now is a great time to be a property owner since during the last three months of 2015 property owner’s rental income added up to about 4.3 percent of the U.S. national income. Meanwhile, key takeaways from the “Emerging Trends in Real Estate” report published by the Urban Land Institute and pwc has us looking forward to successful investments for properly managed rental assets.
In California, a security deposit for an unfurnished, residential rental unit cannot exceed 2 times the monthly rent. (Note that if a unit is furnished, the deposit can be increased to 3 times the rent). All deposit money must be refundable. California law does not allow a landlord to charge a non-refundable deposit. Even if the landlord calls it a nonrefundable “key deposit” or a “cleaning deposit” and includes the provision in the lease, it is still refundable. Because non-refundable deposits are illegal in California, such clauses are not valid and will not be upheld by a Court.
Keep copies of all rental records in one place. Showing that a tenant has the right to a return of security deposit requires preparation in advance. Start during a walk-thru just before you actually move in, even if the tenant was required to sign a lease or rental agreement that recited that the unit was in perfect condition. Make a list of the conditions in each room/area and have you and your landlord sign it.
When you choose to rent an apartment or house, your personal items are not covered if there happens to be a break-in or a fire or some other unfortunate disaster that can cause destruction to your personal belongings, unless you have renter’s insurance.
Renter’s Insurance can cover items ruined during the following natural occurrences, as well as theft.
Plumbing System Freezing