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Hollywood Real Estate Law Blog

What happens if a seller isn't out by your possession date?

You finally found the house of your dreams here in Florida. You are no doubt eager to start making memories at your new place, but waiting is usually part of most real estate transactions. The seller usually has a few weeks or even a couple of months before they need to move out of the house.

Negotiating the possession date for the home is usually one of the important considerations in a home purchase transaction. The seller may need to purchase a new property or make arrangements to move their possessions. Setting an official date gives both the buyer and the seller the ability to plan and make necessary arrangements. Sadly, sometimes, the buyers show up ready to get their keys, only to learn that the seller isn't ready to leave.

Achieving your goals through a 1031 exchange

Successfully investing in real estate is one of the most popular ways to acquire wealth. While many people are extremely successful when investing, others struggle to make smart and strategic choices. As a result, they may lose money in the process.

If you are an owner of real estate, and you want to start making smarter choices and investing wisely, you should make sure that you are taking advantage of all incentives at your disposal. One of the ways you can avoid income tax when investing is through a 1031 exchange. To benefit from this, you must reinvest the profits made from one property into a similar one within the required time period. The following are some of the possible outcomes that you could achieve by taking advantage of a 1031 exchange.

Why investing in 'cannabis real estate' is worth thinking about

No matter what you personally feel about marijuana legalization for medicinal or recreational use, there's no question that opinions in this country have undergone a remarkable shift where cannabis is concerned. You could find yourself wondering if "cannabis real estate" is a good commercial investment.

Had you asked that question a few years ago, most people would have told you that cannabis real estate is too problematic to fund, too difficult to find and too hard to manage given the uncertainty of the changing legislation. Now, however, cannabis real estate looks like it may be the next big wave in commercial real estate.

Clauses in a real estate contract that could cause a problem

When buying real estate, regardless of the type or price, you'll soon find yourself drowning in a mound of paperwork. While it's tempting to sign everything and hope for the best, doing so puts you at risk of making a mistake.

It's critical to review the finer details of your real estate contract, paying close attention to any clauses that could cause a problem down the road. Here are some of the most common:

  • Inclusions and exclusions: For example, when buying a home, this outlines what the seller is to leave and what they're permitted to take. Maybe you're expecting the person to leave all the appliances, just to find that they want to take them. This is a sticking point in many real estate contracts.
  • Earnest money: When buying real estate, you'll put up earnest money (also known as hand money) to show that you're serious. It's important that the money be held by an escrow agency, not the seller.
  • Closing clauses: Your real estate contract will include quite a bit of language regarding the closing, such as when and where it will take place and the reasons an extension may come into play.
  • Warranties: While not included in every real estate transaction, the seller may offer some type of warranty to the buyer. Whole house home warranties, which are serviced by a third party company, are extremely common.
  • Possession of the property: As a buyer, it's likely that you want to take possession of the home on the same day as your closing. If the seller wants to continue to live there, such as until their new home is ready, add a rental clause to ensure that you're compensated accordingly.

Details to pay attention to in commercial real estate leases

When negotiating a commercial real estate lease, you may feel overwhelmed by all of the different terms and options that you have. Commercial real estate leases can vary extremely widely in terms of what they offer. For example, a commercial real estate lease for an office space may include everything from insurance and lighting to cleaning services. However, another may only supply the right to be in the space and requires that the tenant arrange all other services for the property themselves.

If you don't know where to start when it comes to deciding on the type of commercial real estate lease that is best for you, you should start paying attention to some of the key terms commonly found in these leases. By doing so, you will be better equipped to decide on some of the details.

Can setting up a company benefit my real estate investments?

Dealing with large investments that have high profit and loss potentials involves a significant amount of risk. It also has tax implications. As such, when you are investing in real estate to make capital gains in a sale, you should consider creating a company so that you can protect your assets and manage your finances in a structured way.

There are many benefits to creating a holding company, otherwise known as a Limited Liability Company (LLC). The main benefit is that if you suffer a loss as the result of a failed investment, your personal assets and other assets held in separate LLCs, will be protected. The following are some of the main benefits of starting a real estate holding company.

Common questions about like-kind exchanges

Like-kind exchanges, otherwise known as 1031 exchanges, are a great way for property investors to defer capital gains taxes. By engaging in a like-kind exchange, you will need to show that the profit you made from the selling of a property will be directly invested into another investment property.

If you want to benefit from engaging in a like-kind exchange, you should make sure that you have a thorough understanding of the intricacies of the law before proceeding. By doing so, you will be able to prepare yourself for a smooth process.

Preparing a commercial real estate lease

If you have recently invested in commercial real estate, you will need to prepare a lease before you can gain rental income from tenants. Doing so effectively is a crucial part of the process. You will need to make sure that you protect your interests while ensuring that your future tenant is satisfied.

You should make sure that you have a good understanding of the type of lease that you would like to draft. It's also important that you prepare by creating a strategic vision of the tenancy.

The pros and cons of investing in rental real estate

Businesses and entrepreneurs alike often see the potential benefits of investing in rental real estate. Doing so can create rental revenue in the short term, and this can help to cover mortgage costs or even provide a steady flow of income. In the long term, there is potential for additional profit when the property is sold.

However, there are certain risks associated with commercial real estate investments. Mistakes can be easily made when investors are not experienced, and it is not always the most efficient way to create profit. If you are considering investing in commercial real estate, take the time to consider the pros and cons before doing so.

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