When you purchase a piece of property, it’s important to know if it comes with an easement attached. There are two main types of easements, which are known as an easement appurtenant – where the easement “runs with the land” – and an easement in gross, which is often known as a personal easement.

A personal easement can be eliminated when the property changes hands. It generally means that two property owners had a standing agreement with each other. That agreement is not officially part of the land in any sense, so the new property owner gets to decide if they want to honor it or not. But things can be very different if an easement is classified as one that runs with the land.

CHANGES TO THE LAND ITSELF

With an easement appurtenant, the actual legal description of the land is changed. The easement becomes part of the land, and an inherent part of that property. What this means is that the easement is transferred along with that property it is purchased by a new owner. A seller of the affected property is required to disclose that it exists before the property is purchased by someone new, as the easement can impact the value of the property in question.

In many scenarios, an easement appurtenant may be critical to someone else’s ability to use their own property. A common example of a situation in which this kind of easement may come into play involves when one property separates the other from a main road. The owner of the property that has been separated may have an easement allowing them to drive across the first property. Without that permission, they would not be able to use their own land.

Easements can get complicated, and they are just one factor to consider when buying or selling real estate. If you are going through the process of navigating a real estate transaction, it’s very important to know exactly what legal options you have and what your rights are. That way, you can make truly informed decisions about your situation.

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Investing in rental properties can be a rewarding venture, but it’s not without its fair share of challenges – especially if you’re a first-time landlord.

By learning more about common mistakes shared by first-time landlords, you can set yourself up for a much smoother experience. Here are the biggest missteps to avoid:

FAILING TO SCREEN TENANTS

You may trust your “gut instincts” a lot when it comes to business but don’t make that mistake when it comes to your tenants. Failing to thoroughly vet your potential tenants can lead to problematic occupants who pay rent late, cause damage to the property or behave in ways that cause conflicts with other tenants. Always do thorough background checks, verify a prospective tenant’s employment and income, and contact previous landlords for references.

USING GENERIC OR “BOILERPLATE” LEASES

Another common mistake is using a generic or poorly drafted lease agreement. A comprehensive lease agreement is essential for protecting your rights as a landlord and clearly outlining the responsibilities of both parties. Tailor your lease agreement so that it covers essential terms such as rent, security deposit, pet policies, maintenance responsibilities and eviction procedures. (Remember: If it isn’t written down in your agreement, you can’t hold your tenant to it.)

FAILING TO KEEP LINES OF COMMUNICATION OPEN

Inexperienced landlords often overlook the importance of clear and timely communication with their tenants, and that breeds resentment and leads to trouble. Establish an open line of communication with your tenants and respond to their inquiries or concerns promptly. Consider using technology such as email, texts or property management software to both streamline and document your communications.

NOT UNDERSTANDING LANDLORD-TENANT LAWS

Not understanding the intricacies of the Fair Housing Act or other landlord-tenant laws, including those on the local level regarding things like security deposits and eviction procedures, can result in major legal issues and financial losses.

With these guidelines in mind and a little legal guidance, you can navigate the landlord role with confidence and better ensure that your investment stays profitable.

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This issue is not a novel one. Tenants fail to pay rent all the time. Unfortunately, since 2020, the issue has grown, and tenants found themselves benefiting from various legal protections.

Although the idea behind the protections, to help keep people in their homes and business sites during the worst of the pandemic, was noble, the reality was not always as altruistic. Some tenants took advantage of these offerings to avoid paying their rent even when they had the financial capacity to meet their contractual obligation.

WHAT ARE THE PROTECTIONS?

One example was the LA County Eviction Moratorium, which began on March 4, 2020. Lawmakers designed the protections to help keep renters in their homes when it was difficult to pay rent during the worst of the COVID-19 pandemic.

CAN LANDLORDS MOVE FORWARD WITH LEGAL REMEDIES?

The LA County Eviction Moratorium protections ended on March 31, 2023. As of April 1, 2023, landlords could move forward with the expectation tenants make full rent payments for those due on or after April 1. Landlords can now consider eviction options for those who fail to make these payments.

Landlords are also able to consider suing tenants for rent owed. This is allowed even if the tenant paid 25% of the rent due from September 2020 through September 2021.

It is important to note that some local jurisdictions may have permanent tenant protections. Any landlord looking to move forward with eviction action may be wise to seek legal counsel to ensure their actions are within the bounds of the law.

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While countless industries struggled during and following the worldwide COVID-19 pandemic, one, in particular, saw significant revenues from 2020 to 2021. The real estate industry significantly benefitted from unprecedented lower interest rights, not to mention considerable demand. Fast forward to today. The housing market remains strong, yet with a limited volume.

Those who did not avail themselves of the potential savings decided that familiar and existing surroundings in uncertain times took precedence.

NEW METHODS TAKE PRECEDENT

What changed most in the home buying process beyond looking for new dwellings versus staying put is the significant changes in the most straightforward practices when it comes to showing and buying homes.

Even though national orders to stay home, wear masks, and social distance has expired, countless people remain skittish about bringing people into their houses. Many states and localities maintain their restrictions, leaving open the chance of yet another variant spreading through the country.

In the end, it is left to the seller’s discretion as to how showings will commence, mainly if they are still residing in their home. Sellers have notified many agents to schedule appointments for showings on clients that are pre-approved. As with any industry post-COVID, comfort with the process is still paramount, including access to hand sanitizer, gloves, and other types of protection.

Many new home seekers still prefer to see the dwelling in person. When the pandemic began, real estate agents were initially slow to adapt. As sales and customers began to wane, they began to think “outside the box,” relying on social media and virtual tours.

The housing market remains competitive, with little time to schedule online tours or walk through the home. The time span from listing to sale is measured in days, if not minutes and hours. For many prospective homeowners or those looking for a larger home, a successful bid may come down to the luck of the draw.

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Across the United States in 2019, commercial real estate was considered a safe and reliable investment for developers and businesses seeking to grow their enterprises in business districts. However, the trend has sharply reversed in 2023, and now commercial real estate is considered a much riskier endeavor for builders and investors, as the return to office trend has tapered out and many companies are staying out of the Financial Core here in Los Angeles.

Now, it is important for developers and commercial landlords to reconsider their holdings and prospective projects, taking into account the new reality and adapting to these new challenges.

THE LANDSCAPE HAS CHANGED FOR COMMERCIAL REAL ESTATE

There are few historic shifts in real estate that can compare with what has happened in commercial real estate over the last three years. Last month, Los Angeles’s Downtown hit a record of 30% vacancy rate for commercial real estate as many employers continue to use work-from-home models, and the value of the LA commercial real estate market has dropped nearly 40% in the past three years.

How developers and landowners respond to these challenges is important, and there are several options that can be explored to help combat this trend.

REINVEST

The best option for property owners with high vacancy rates is to reinvest in the property, updating the facilities and amenities to create a more desirable property for commercial renters still in the market. New, and recently renovated properties are still performing well in most markets, and this can help turn the trend around for individual owners.

RETROFIT

Another option that commercial landowners can pursue is to retrofit their properties to attract a different type of client. Many office jobs are still remaining on the sidelines of the commercial market, so retrofitting the property into a flexible work environment may be a good opportunity to capture a growing market of commercial renters.

REMODEL

In some cases, a drastic change may be necessary to reinvigorate growth, and for that, a complete remodel of the building for a different purpose such as residential use may be appropriate. While not possible in all areas due to zoning and land use restrictions, it can open up an entirely new field of renters for the commercial landowner to target.

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As a real estate developer, you’ll be all too aware that every part of the building process comes with its own risks. You’re exposed to being liable for a claim from day one. 

To protect yourself, your employees and your business you know that it’s important you have the right insurance in place. What are the risks to you if you don’t? 

1. YOU MAY FIND YOURSELF LIABLE FOR A NEGLIGENCE CLAIM

As a developer, you’re responsible for the acts and omissions of everyone working for you. As humans, people make mistakes. If you don’t have the right professional liability insurance in place, you may find yourself facing a hefty claim against the company if the mistakes that were made are significant and caused damage or injury. 

2. YOU MIGHT NOT BE COVERED FOR CONSTRUCTION DEFECTS 

After the development has been finished, a real estate developer’s worst nightmare is that issues come to light in the way properties have been constructed. It’s expensive, time-consuming and reputationally damaging. 

If you don’t have insurance in place to cover you in the event this happens, it can cost you a huge amount. Given that these defects may not be uncovered for many years, making sure you’re insured is even more important as it’s almost impossible to plan for financially. 

3. EXTREME WEATHER MAY TOPPLE YOUR BUSINESS 

As a developer, weather can be your best friend and your worst enemy. If you don’t have the right level of construction insurance in place in the event that you face extreme weather you can face a number of consequences including damage to properties and machinery as well as paying financial penalties for not finishing a job on time. 

A careful and experienced review of your insurance requirements and policy documentation at the outset can help save you time, money and legal hassles later.

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Landlords often set policies for tenants. These policies are often in place to help reduce issues between tenants, which can be a tricky balancing act. A tenant may also be required to follow any policies to reduce difficulties as a resident. 

One common policy that many landlords put in place is a pet policy. Landlords may limit tenants from having pets. Why would they do that? Here’s what you should know:

REDUCE NOISE COMPLAINTS

Many pets can be noisy, dogs especially. Dogs will often bark at every unknown noise they hear. That could mean that a dog barks at another tenant walking down a hallway. Constant barking can create issues with other tenants. This can be especially troublesome if a tenant’s dog frequently barks at night. 

REDUCE PET SMELL 

Many animals leave behind unfavorable smells after a tenant moves out. Cat urine is a very difficult smell to get out of carpets. Landlords don’t always know how clean tenants can be and tenants can’t always control where animals do their business. Reducing pets can reduce these unwanted smells. 

REDUCE LIABILITY FOR ANIMAL ATTACKS

Landlords can’t always expect tenant’s animals to be well-behaved or trained. If a tenant loses control of their animal, then another tenant’s health could be at risk — and there’s always a possibility that the landlord might be held partially responsible for allowing the animal on the premises. 

ENFORCING PET POLICIES

Landlords may allow tenants to have pets. Tenants may only be allowed one to two pets and may be expected to pay one-time or regular pet fees. These fees can be useful for tenants if there happen to be issues or accidents to their properties caused by pets.

Some tenants will disregard their renters’ agreements and bring a new pet into a property against their landlord’s knowledge. When this happens, landlords may take legal action against their tenants. 

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While the COVID-19 health crisis is apparently in the rear-view mirror after authorities claimed that the pandemic was over, struggles still remain for those suffering not only the ongoing health effects but also the financial impact that still remains.

While the name changed from the LA County Eviction Moratorium to the COVID-19 Tenant Protections Resolution, an initiative started in March 2020, the overall framework gave certain protections to residential and commercial tenants and mobile home residents impacted by the worldwide health crisis.

THE END OF PROTECTIONS CREATE UNCERTAINTY

The resolution came to an end on March 31, 2023. The following day, regular rent payments resumed to keep roofs over heads. However, anti-harassment and retaliation protections are still considerations. However, on that same day, landlords are mandated to serve their tenants with written 30-day notices before they can file an eviction based on unauthorized occupants or pets on the premises.

Income-qualified tenants who took steps to contact their landlord and inform them of their inability to pay rent within seven days of the due date have 12 months to repay past-due balances, provided that there are no extenuating circumstances.

Additional options may exist and include:

• For those who deferred rent between July 1, 2022, and March 31, 2023, via the county-sponsored non-payment of rent protection that may allow them to continue residing in their dwellings for “no-fault” reasons
• Unincorporated Los Angeles County’s Rent Stabilization Program and Tenant Protections Ordinance, combined with the Mobilehome Rent Stabilization and Owner Protections Ordinance, places restrictions on rent increases and provides protections on evictions, except for those with “just cause” for more rental properties and mobile homes.
• More incorporated cities have added permanent protections, along with coverage from the State of California’s Tenant Protections Act of 2019, restricting rent increases and mandating just cause evictions.

In the end, an eviction notice does not necessarily mean that you should pack up and move. Instead, you should take action. Various resources exist to help rental dwellers not only understand but also assert their rights.

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You can and should check up on those who apply to rent or lease your property. Without screening measures, you could end up with a tenant who causes problems for you and others or refuses to pay their rent.

Although you may screen your tenants, you must remain within the confines of California landlord-tenant laws and avoid violating their rights. A savvy individual could call out your improper conduct if a dispute arises, potentially leading to a legal nightmare.

CAN YOU ASK PERSONAL QUESTIONS ON THE APPLICATION?

Like most landlords, you probably have your prospective tenants complete an application. Although this seems like a fine opportunity to conduct some prescreening, you must be careful what you ask on a rental application. Under federal law, you may not discriminate against anyone with a protected status when renting or leasing real property.

If you ask questions like these, you risk violating fair housing laws:

• What year were you born?
• Are you planning to have children?
• Do you attend church?
• Are you or another tenant disabled?
• What faith do you follow?

These questions may seem innocent to some property owners. For example, you might want to ask about disabilities to ensure proper access to the rental unit or grounds. However, such questions can appear discriminatory under the federal Fair Housing Act, especially if you decline the application. A disgruntled applicant or tenant could use these questions against you.

As you can see, there are many pitfalls for landlords to avoid when dealing with tenants. An effective way to reduce legal risks and find trustworthy tenants is through legal guidance. Having a professional assist with your application and screening process can help ensure that you don’t violate any discrimination laws.

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As a real estate developer, it is essential to understand the nitty-gritty details of commercial leases. One key factor to consider when negotiating such arrangements is who pays the building expenses. These include costs like property taxes, insurance premiums, maintenance fees, and utilities – all of which can add up significantly over time if not managed carefully. 

When discussing a gross lease with a potential tenant, everyone must understand what is involved so there are no unpleasant surprises down the line.

WHAT IS A GROSS LEASE?

A gross lease is a type of commercial lease. The tenant pays a flat fee, and the landlord agrees to pay for all expenses that come with the space. This includes property taxes, insurance, maintenance, utilities, and other costs associated with running the building.

The tenant is only responsible for paying one fixed rent payment each month. It makes it easier to budget since they know exactly what their monthly expenses will be. It also lets them focus on their business instead of worrying about fluctuating bills or unexpected costs.

The landlord is responsible for covering the building’s operating expenses, including repairs, cleaning services, landscaping, snow removal and more. They may also need to pay for any necessary upgrades or renovations to keep up with changing regulations or trends in the industry.

Gross leases can benefit tenants and landlords, but the advantages may vary depending on the situation. The landlord should ensure they can cover all of the necessary costs associated with running the building while still making a profit from renting out the space. 

A well-drafted rental agreement can help protect the rights of both the tenant and the landlord. It can clarify issues such as rent, expenses, maintenance responsibilities, and other important terms. All provisions should be clearly outlined in the rental agreement to avoid potential disputes in the future.

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