CAN A CITY FORCE REPAIRS?

By
Real Estate Broker/Owner with people first...then business Ran Right Realty BRE Agent 636943

I manage a property in a medium size City in California and received a notice from my client (the owner) who received a notice from the City stating the following: The interior and the exterior of the above referenced property is scheduled to be inspected on May 20th 2018 between the hours of 8:00 a.m. and 2:00 p.m. to see if you are compliant with Uniform Housing code

HAS OWNED PROPERTY FOR DECADES

My client has never gotten a notice like this and he has owned this property for generations. He wanted my opinion on what is going on and what to do about it? The property had been rented out by the same tenant for over 20 years at a low rent. However, she gave notice and moved. We re-rented the property

I HAVE MANAGED PROPERTY FOR DECADES

In all my property management experiences, I have never gotten a randomly selected notice of this type. Yes, I have gotten violations, health department claims, building code notices and requests from tenants and the like but never a systematic inspection carried out by a City as part of their charter

THEY AVE 265 POINTS TO MAKE?

Accompanying this notice is a list of 243 items they will be looking at and for. My first impression was that this is illegal, unenforceable & subject to challenge in a court of law just on its face. Why? At the discretion of the City Inspector, he can cause an owner of a property to spend tens of thousands of dollars and ....

EVICTION of  TENANT

Furthermore: In addition to demanded and discretionary repairs, this could cause the tenant to have to move to perform the work. Not only that but if the property is older of which this is, making repairs leads to the inevitable Pandora's box of remodeling i.e. one thing leads to another that needs fixing and or updating

BANKRUPTCY OR FORECLOSURE OR LOSS OF INCOME

If the property has a mortgage or loan on it and the income from the rental is needed to pay it, this immediately puts the entire investment into jeopardy for all concerned. What if the owner is reliant on the income? What about the hardship caused to a tenant that has to potentially move? 

CITIES ARE SELF-INSURED

Most people are not aware that cities self-insure themselves thus not having a company that does it. However, cities are run on strict budgets and extra expenses, lawsuits or catastrophes challenges the budget even endangering it. They spend their day to day activities monitoring their welfare and their public

THIS IS CHALLENGEABLE

There are so many laws on city, state and federal levels that they often clash and many are not enforceable or legal. This is not known until these laws are challenged. If they hold, they are fortified. If they fail, they are modified or removed. This situation if filed as a class action may prove costly and winnable too

SYSTEMIC HEALTH & SAFETY INSPECTION

This is what they call it. I know they mean well. The bar for rentals is being raised but at whose expense, inconvenience or request? Tenants are not requesting it, landlords are not so how can it be any ones else business? They go on to say that if it passes it will not be inspected for four years. It also says this.....

FAILING TO PASS THIS INSPECTION

If you fail this inspection, you will be giving a list of corrections to make and a chance to correct before being reinspected. Let me once again bring up that they have a check-off list of 265 items they can choose from and each one comes with time, money and problems of their own all forced upon a property owner

MY RESPONSE TO MY CLIENT

I have reviewed the notice in detail. My first reaction is that it is unfair and possibly illegal to single out residential rental properties as opposed to owner occupied units and make them stand for what could be a costly inspection and repair situation. If this is part of Ontario’s Charter then it may enforceable but contestable in its nature. This would prove costly (need attorney) to do. The City’s intent is to maintain a high standard of living so who can argue that? Even if you successfully prove it is discriminatory in its nature it would involve time & money. The best approach then is to make repairs which ultimately maintains values and conformity for all involved

FURTHERMORE

Out of 265 potential violations (see original list), You have a potential 18 that may or do (by my standards) apply to you for correction. They are listed as follows: 101, 103, 105, 117, 123, 135, 140, 141, 142, 144, 146, 150, 152, 214, 242, 249, 254, 259.

OTHER DYNAMICS

This is a delicate situation because it is dependent on who you get for an inspector. If a by the book hard-nosed person is assigned the benefit of all work will go toward major repairs. If a more liberal person is assigned, the minimum will re required or less can get you by. We have no way to ascertain what type of person will inspect. Be aware they have the power to shut down the rental activity if any resistance or lack of cooperation takes place.

 CONSIDER THIS

One approach to take which will make this lean in your favor is to go do the work NOW and when the person comes they find most everything looking good which causes them to just write this thing as done (not look so hard) and move-on. If you don’t do the work in advance, it just invites a more thorough inspection. This takes us back to the “what kind of inspector” will we get?

 NOTE THIS

Raising rents to offset these repairs is not recommended as it can be seen as retaliatory.

Fellow professionals...your thoughts?

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Topic:
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Tags:
repairs
landlord
rules
tenants
fee simple
property rights
property inspection
regulations
property condition
enforcement
hardship
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Ambassador
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Debb Janes EcoBroker and Bernie Stea JD
ViewHomes of Clark County - Nature As Neighbors - Camas, WA
REALTORS® in Clark County, WA

I'm all about proactive measures, especially when faced with a bureaucratic entity.  It's tough to win this battle without a lot of money - as you suggest - and even then, there are no guarantees. I'm pretty certain they ran this by their city attorneys. I too hope you do a follow up...

May 18, 2018 06:55 AM #10
Rainmaker
2,258,101
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Hello Debb Janes EcoBroker and Bernie Stea JD ...your comment stands

May 18, 2018 10:41 AM #11
Rainmaker
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Lawrence "Larry" & Sheila Agranoff. Cell: 631-805-4400
The Top Team @ Charles Rutenberg Realty 255 Executive Dr, Plainview NY 11803 - Plainview, NY
Long Island Condo & Home Sale Specialists

I don't think it would be worth it to try and fight this one...

May 19, 2018 07:13 AM #12
Rainmaker
2,258,101
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Lawrence "Larry" & Sheila Agranoff. Cell: 631-805-4400 ...agreed

May 19, 2018 08:34 AM #13
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Kathy Streib
Room Service Home Staging - Delray Beach, FL
Home Stager - Palm Beach County,FL -561-914-6224

                                                         

      Thank you Richie!

May 19, 2018 05:50 PM #14
Rainmaker
2,258,101
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Kathy Streib ...good of you to stop in and compliment the post

May 19, 2018 07:01 PM #15
Rainmaker
4,213,792
Barbara Todaro
RE/MAX Executive Realty - Franklin, MA
"Franklin MA Homes"

Good morning, Richie Alan Naggar I hope your client has deep pockets to fight 'city hall' .... not likely to win..... investment property in California may not be a big sell at this point....

May 20, 2018 04:22 AM #16
Rainmaker
2,600,106
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker

Good morning Richie. What choice do you have? Inspect and repair before the actual inspection is your only choice! And, the most favorable monetary alternative. Enjoy your day!

May 20, 2018 04:50 AM #17
Rainmaker
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Nina Hollander
RE/MAX Executive | Charlotte, NC - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

Oh wow, Richie... have never heard of anything like this, especially vis-a-vis the interior of a house. We have certain codes for exterior, which the city/county can enforce, but never such a full-scale inspection. Is this a California thing?

May 20, 2018 05:13 AM #18
Rainmaker
2,258,101
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Hello Barbara Todaro ...your comment stands. Repairs will be done reluctantly

Hello Wayne Martin ...your comment stands and thank you

Hi there Nina Hollander ...Its a Ontario CA thing as you put it. Very controversial

May 20, 2018 06:44 AM #19
Rainmaker
3,386,030
Dorie Dillard
Coldwell Banker United Realtors® ~ 512.346.1799 - Austin, TX
Serving Buyers & Sellers in NW Austin Real Estate

Good morning Richie Alan Naggar ,

I'm so glad that Kathy Streib featured this in her "Ah-ha" moments for the week. This is so typical of big government reaching out in business they have no business in. Its time everyone carefully looks at who they are electing into positions of power that can make these kinds of decision. Private property owners beware you investment is taking a new turn and you might want to reassess!

May 20, 2018 06:54 AM #20
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Debe Maxwell, CRS
www.AtHomesCharlotte.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
Charlotte Homes for Sale - Charlotte Neighborhoods

OH MY, Richie! My first response was, "Yes, they are in California!"

I salute your response to your client as you are 100% correct - fix those issues and it will make the inspection go so much better.

My first question would be to others in your area - is this real? Have they had clients who have had this happen to them? 

I am so sorry your client is having to deal with this - I'm just in shock that something like this is even in place. No wonder your taxes are outrageous!

May 20, 2018 09:58 AM #21
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Hannah Williams
Re/Max Eastern inc. - Philadelphia, PA
Expertise NE Philadelphia & Bucks 215-953-8818

Richie Alan Naggar  Good luck in fighting City Hall . Sounds like they want the property up to code . In our area we deal with these issues  often . How bad is this property ? It should be up safety codes  if you are renting it to tenants . He is lucky it took so long for them to inspect . I understand your concern but it is best to call and get estimates  and keep the client calm

May 20, 2018 10:32 AM #22
Rainmaker
2,258,101
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Hello Dorie Dillard ...this woman speaks truth fluently

Debe Maxwell, CRS ...what a good agent, neighbor and helper you are

Hannah Williams ...a calming practical force thank you

May 20, 2018 11:17 AM #23
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Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude - Carlsbad

Hi Richie

Wow, I have not heard of anyone having this experience. I think your response to your client was right on target. Do let us know the outcome.

Jeff

May 20, 2018 12:43 PM #24
Rainmaker
2,258,101
Richie Alan Naggar
people first...then business Ran Right Realty - Riverside, CA
agent & author

Hello Jeff Dowler, CRS ...thank you Jeff for coming by

May 20, 2018 02:03 PM #25
Rainmaker
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Lynnea Miller
Bend Premier Real Estate - Bend, OR
Premier Real Estate Service in Central Oregon

Richie Alan Naggar - another reason why states which lament that affordable housing cannot be found create reasons why. As rent control measures are passing in the larger metropolitan areas of our state, we have more and more small investors in our market selling their properties because they do not want to deal with such craziness.  What goes on in California may migrate north (along with many of your citizens) and impact Oregon.

May 20, 2018 05:25 PM #26
Rainmaker
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John Pusa
Berkshire Hathaway Home Services Crest - Glendale, CA
Your All Time Realtor With Exceptional Service

Richie Alan Naggar this is very interesting that the city inspecting the property without proper notice. Please update us on the latest development.

May 20, 2018 08:39 PM #27
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Patricia Kennedy
RLAH Real Estate - Washington, DC
Home in the Capital

Richie, I'd say this is right up there with an IRS audit notice in terms of the big scaries!

I think your advice to address anything you know they will find before the inspector comes is wise.  And here. I'm thinking that rental properties are subject to some kind of inspections before you can get a Certificate of Occupancy.  

And the local politicians are talking about the lack of affordable housing!  

May 21, 2018 03:55 AM #28
Anonymous
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I'm a great

May 25, 2018 04:32 PM #29
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