Lancaster, CA · Member since 2017 · 8 posts · 3 votes
After my due diligence, I know the property has been within a family for a number of years....
It looks like there have been multiple quit claim deeds to different family members. The vacant property is also sub-standard, which if I read correctly, prohibits the owner from any sort of tax deductions on the property, ie they cant depreciate, cant write off interest from the loan
Also, the home has gone into foreclosure multiple times, but is later rescinded after outstanding payments have been paid. My first guess would assume that they can barely hold onto the property, but the tax address of the homeowner/s is in Beverly Hills, not exactly a cheap place to live...
My question is, why would they be holding onto this property? Is there a tax incentive I am not aware of?
Investor · Seatac, WA · Member since 2017 · 134 posts · 121 votes
6y
People can be weird about property, especially if i'ts been in the family for a long time. It's family property and so they can't lose it or sell it, even though they don't want to keep it or maintain it. Sentiment can be a huge driver for irrational decisions.
Investor · Seatac, WA · Member since 2017 · 134 posts · 121 votes
6y
People can be weird about property, especially if i'ts been in the family for a long time. It's family property and so they can't lose it or sell it, even though they don't want to keep it or maintain it. Sentiment can be a huge driver for irrational decisions.
Investor · Baltimore, MD · Member since 2008 · 17k+ posts · 13k+ votes
6y
@Nicholas Fitzgerald you often won't know the motivations of owners. As @Alecia Bolton says people do all kinds of things that don't make sense on the surface. This can even hapen with banks. The bank may have written the property off, but the loan servicing company keeps paying the taxes. all kinds of strange things can happen.
The bottom line is, it doesn't matter in how or whether you approach them to do a deal. It only matters if they want to do a deal. Then it may affect negotiations.
Lender · Ladera Ranch, CA · Member since 2014 · 1k+ posts · 1k+ votes
6y
@Nicholas Fitzgerald Back when I was focused on fix and flips, I came across a nice condo in a nice suburb of San Diego. The owner was deceased and the unit still had stuff in it. It was about to go to tax sale. The deceased owner's sister thanked me for alerting her to the issue and paid the taxes. She indicated that she was willing to sell the property but I never talked to her directly again. I sent written offers to the sister by mail, even hand carried another offer to her residence in an attempt to open a dialogue. I tracked that property for a few years and checked the physical location once. Everything was the same.
Why would someone leave a valuable asset lying around while paying ongoing holding costs (HOA and property taxes)? Only the sister knows for sure and it doesn't really matter. For some reason, she didn't want to deal with the problem and would rather continuing paying those costs instead of dealing with the situation. I learned it's best not too spend too much time on a situation like that. Keep it on a list of properties you check in on from time to time. One day, you might have a motivated seller and things will change.