“We do not have government by the majority. We have government by the majority who participate. ” Thomas Jefferson

Housing providers should be worried. Prop 33, which could remove the Costa Hawkins legislation could make it more difficult to operate buildings in California.

WHAT IS PROP 33? I am sure you have heard all about the proposed legislation and seen the many ads for and against Prop 33. It would do a number of things, none of which are good for housing providers. VACANCY CONTROL would mean that you could not rent a vacant unit at market rate, but instead would be forced to rent at the rate the previous tenant was paying. It would include rent control; single family homes and would remove the date of construction as a limiting factor for rent control.

BAD FOR TENANTS TOO. Prop 33 will remove incentives for investors to purchase rental properties and it will remove incentives for builders to build badly needed rental units. By making it more difficult for housing providers to rent units at market, even after a tenant has moved, they will invest in stocks or gold or other types of investments. If they do invest in real estate, it will more likely be through real estate investment trusts (REIT’s) or Delaware Statutory Trusts (DST’s) These investments pool a large number of investors in to a corporate trust. This creates the situation that tenant groups say they are trying to avoid. Most investors currently own 10 or less units, but this legislation could change all that.

GET OUT AND VOTE Recent polling data (Sept 25 to October 1st ) from CAL MATTERS shows 37% voting yes and 36% voting no. Undecided voters are at 27%. If you are a housing provider, this is very important info. With such a large percentage of undecided voters on Prop 33, it could go either way. If you care about the future of rental properties in California, especially your own, make sure you get out and vote NO ON 33!

“Every strike gets me closer to the next home run. ” Babe Ruth

What we at PRS PROPERTIES CAN DO. We can give you a good idea of the current value of your building. We can suggest changes you might want to make before sale to give you an idea what type of building you would be able to exchange into. You may decide to stay in the rental business. We are always available to chat. We can give you referrals for professionals, such as lenders, contractors, and engineers, so that you can decide who you feel best with. We can supply you with rent and sale comparable in the area of your properties, so that you know what rental values are in your area. It is important that you know the true value of your rental units, so that you can get them rented right away at market value, or at least as much as possible with rent control restrictions. We can look at potential purchases that you may be interested in to make the property more desirable, and maybe look at potential issues that an insurer might require you to repair.

If you should decide to sell your building, we can help you exchange into a larger or smaller properties. We can even help you move into something with less management responsibilities. We can also help with getting the paperwork together for a refinance if that is your desire. We can also recommend experienced licensed contractors who can perform any repairs or installations you may need prior to selling. We can also look at your building for other easy and inexpensive changes that might allow you to get a higher value. We can help you to get the maximum value for your property, should you decide to sell, or the maximum return if you are planning to keep your building.

We are currently looking for “as-is” properties and are willing to purchase with low rents, deferred maintenance or even with a problem tenant in place. We can offer a 7 day escrow and all cash at closing. Give us a call. We have also put together numerous transactions over the years which involve properties that are not listed for sale. Many investors are currently in 1031 exchanges and need to identify a replacement property before their 45 day identification period runs out.

Should you decide to put your property on the market, we will put together an aggressive, targeted and professional campaign to get your property sold fast. We have been doing this for over 40 years, and we will use all the tools available to bring you the most dollars at closing. If you are thinking of selling or are just curious about the value of your property, don’t hesitate to give us a call.