 |
| Fractional Ownership |
|
Fractional Ownership
Many people who wish to own vacation property cannot afford or justify bearing the full cost, maintenance and management burden when they expect to use the home only occasionally. Fractional vacation home sharing creates a situation where the cost and management burdens of the vacation home are more closely related to actual usage. It is an excellent alternative to vacation rentals.
In fractional ownership, a group of families and/or individuals co-own a vacation property for their own use and, sometimes, for rental to others when no owners are using it. A typical fractional agreement includes rules governing how often each owner can use the home, how usage is reserved and managed, how expenses and other responsibilities are shared, and when and how each owner can leave the group by selling his/her share, being bought out by other owners, or forcing a sale of the entire property.
This pamphlet provides a comprehensive discussion of the issues associated with fractional vacation home co-ownership.
|
An Introduction To Fractional Ownership
Excerpt from a recent article by Andy Sirkin providing a brief introduction to fractional vacation home ownership |
Taxation of Fractional Vacation Home Interests
Analysis of tax issues related to fractional vacation home sharing and vacation home co-ownership including fractionals, time shares and time share estates (210 KBytes, PDF) |
Taxation of Fractional Vacation Property in France Owned by Non-French Residents
Tax issues for non-French purchasers of fractionals in France property; key concepts in French real estate transactions, taxation and treaties; tax effects of various fractional ownership structures; tax consequences of vacation rentals and “commercial” characterization (354 KBytes, PDF) |
Sirkin’s Fractional Ownership Regulation Guide
Disk with a complete text of laws, regulations and filing requirements for fractional and timeshare real estate sales and projects for all 50 states plus a summary of the most critical aspects of each state's law in 5-7 bullet points |
California Fractional and Time Share Law
California law relating to fractional vacation home sharing and fractional vacation home co-ownership including time-share and fractional ownership arrangements (977 KBytes, HTM) |
|
| Equity Sharing |
|
Basic Equity Sharing Structure
Equity sharing is a popular way for people with a low down payment or no down payment to buy a home. It is also a way for people to make relatively a low risk investment in real estate which provides wonderful tax benefits and does not require ongoing management or additional investment. It is also frequently used by parent wishing to help their cash-poor children buy their first home, and by employers wishing to attract and retain quality employees in areas where home ownership costs are high.
In equity sharing, two parties, an "occupier" and an "investor", pool resources for the down payment on a home. They jointly apply for a mortgage, and both names appear on the deed. For an agreed number of years, the occupier lives in the home, keeps it up, and makes all monthly payments. The investor contributes to major repairs and improvements. At the end of the agreed term, the occupier buys out the investor by re-paying his contributions plus an agreed percentage of the appreciation. If the occupier doesn't want or can't afford the buyout, the property is sold, each owner gets their contributions, and any profits are shared.
This article provides a more thorough explanation of equity sharing and some basic examples. |
The Home Equity Sharing Manual
A 187 page book providing the most thorough and comprehensive explanation of equity sharing available. Chapter topics include: Maximizing Tax Benefits, Calculating Ownership Percentages, Making Equity Sharing Happen: A Home Buyer's Guide, A Seller-Investor's Guide, and A Real Estate Agent's Guide. |
|
| Tenancy in Common |
|
Tenancy in Common Q & A
More and more people co-own apartment buildings, or parcels of land with two or more houses, either as homes or for investment. This type of arrangement is particularly popular in areas where housing is expensive because it can provide a less expensive alternative to condominiums and single family homes. This pamphlet provides answers to the most commonly asked questions about tenancy in common ownership. |
DRE Public Reports For Large Tenancy In Common (TIC)
A detailed explanation of the law applicable to larger TIC projects involving contractual exclusive occupancy rights to individual residential units |
A Primer on Tenancy In Common
An introduction to tenancy in common ownership |
New Case Limits Local Governmental Regulation of TICs
Daro v. Foy, just decided by a California appellate court, clarifes that TICs do not fall under the Subdivision Map Act and therefor are not subject to local subdivision or condominium conversion restrictions. See pages 10-14. (178 KBytes, PDF) |
TIC Corner Columns For November 06-May 07
Case Study involving the sale of an apartment building to a group involving the building’s existing tenants |
TIC Corner Column for November 2005
Selling TIC shares one at a time as tenants vacate; Protecting a seller from the financial risks of having TIC co-owners; Does selling TIC shares increase the seller's property taxes? Can TIC sale proceeds be used in a 1031 tax-deferred exchange? |
TIC Corner Column for August 2006
Availability of individual (fractional) TIC financing; kinds of fractional TIC loans currently available; Does selling TIC interests create unusual liability for an apartment building seller? |
TIC Corner Column for August 2007
TICs AND 1031s—PART I |
TIC Corner Column for August 2005
Is individual TIC financing possible, and how does it work? |
DRE Regulation of Tenancy In Common Projects
Spring 2003 edition of DRE publication "Real Estate Bulletin" with article stating the California Department of Real Estate's current position regarding regulation of large TICs (257 KBytes, PDF) |
TIC Public Report Re-Sale Exemption
Described conditions under which the California Department of Real Estate does not require a Public Report for resale of a TIC share in a 5+ unit building (51 KBytes, PDF) |
TIC Purchase Contract Addendum/Disclosure (group loans)
An attachment for purchase contracts which provides the contract contingencies, terms, and disclosures which need to be added to standard form purchase contracts for individual TIC interests sold with group financing (112 KBytes, PDF) |
TIC Purchase Contract Addendum/Disclosure (individual loans)
Purchase contract addendum for sales of TIC interests with individual loans (90 KBytes, PDF) |
TIC Sales Statistics
TIC sales statistics and trends for San Francisco (378 KBytes, PDF) |
TIC Corner Column for February 2005
Changes in San Francisco condominium conversion rules. Are TICs formed for large buildings more risky? How are TICs structured? |
California Subdivided Lands Act
This law governs the subdivision of properties with five or more residential units. Even though co-ownership of undivided property, such as TIC arrangements, does not seem to be a legal subdivision, the California Department of Real Estate believes that the Subdivided Lands Act applies to these arrangements. (474 KBytes, HTM) |
Court Decision in McTIC Lawsuit
Court decision in "Tom v. San Francisco" striking down TIC regulation and arguably holding that local governments cannot prohibit TIC formation by homebuyers. This decision was later ordered published, making it official law. (3819 KBytes, PDF) |
Overlapping Lives: When TICs go bad, and when they don't
By Carol Lloyd, at SFGate.com
As the demand for properties available at the bottom of the market -- be they located in Bayview or Belmont -- has intensified, the TIC, once the ugly step sibling of the condo, has moved out of the margins and into the mainstream. |
|
| Condominium Conversion |
|
Clarification of San Francisco's Condo Conversion Rules
The SF Department of Public Works explains new interpretations of the condominium conversion rules including when building additions/renovations allow conversion without winning the lottery |
Map Signing No Longer Required For SF Condo Conversions
The San Francisco Department of Public Works has announced that it will no longer require the consent of a property’s existing mortgage lenders in order to allow a 2-4 unit property to be converted to condominiums. |
Past Evictions May Prevent SF Condo Conversions
The San Francisco Board of Supervisors has passed a new law linking a building’s eviction history to its ability to be converted to condominiums. |
Text of New SF Condo Conversion/Eviction Restriction
Full test of new law restricting San Francisco condominium conversions based on tenant eviction history (95 KBytes, PDF) |
2007 San Francisco Condominium Conversion Lottery Results
This link provides access to San Francisco's DPW website page allowing owners to determine whether they won the 2007 condo lottery and, if not, their position on the standby list. |
Condominium Conversion in San Francisco
Not all communities permit the conversion of existing residential properties into condominiums, and many of those that do impose significant restrictions and requirements. This pamphlet describes the rules governing condominium conversion in San Francisco. We may be able to assist with condo conversions elsewhere, and feel free to contact us about these. |
Text Of Condominium Conversion Lottery Legislation
Complete text of the new law altering the condo lottery based on seniority of participation. (460 KBytes, PDF) |
Mandatory Condo Conversion Hearing
Would have made every San Francisco condominium conversion lottery winner subject to Planning Commission and Board of Supervosor hearing and discretion. It was vetoed by Mayor Newsom, and the Supervisors did not have the votes to override. (380 KBytes, PDF) |
Supervisors Disapprove Conversion Based on Section 1386
S.F. Supervisors recently blocked conversion of a lottery-winning building. Tenant groups touted the decision as a watershed, but the Board later reversed itself and reinstated the conversion. What is significance of these events? |
Can an owner sell during the condominium conversion process?
DPW's Barbara Moy's response to this question (7 KBytes, HTM) |
San Francisco Subdivision Code
Relevant sections of San Francisco's condominium conversion law (806 KBytes, HTM) |
TIC Corner Column for March 2006
San Francisco’s new condominium conversion lottery system. The odds of winning the 2006 condo conversion lottery |
Proposed New Condominium Conversion Law Fails
A proposal by Supervisors Dufty and Alioto-Pier that would have allowed larger owner-occupied TICs to bypass the condominium conversion lottery was defeated by a 6-4 vote on April 5. Supervisors Peskin and Maxwell were the key "no" votes. |
San Francisco Condominium Conversion Status Tracking
San Francisco Department of Public Works -- Subdivision Project Tracking System |
California Subdivision Map Act
This law imposes a variety of technical requirements on California subdivisions. (1785 KBytes, HTM) |
Tenant Intent to Purchase Form
As described in the Condominium Conversion pamphlet, approval of a certain percentage of building occupants is required for some San Francisco condo conversions. This is the form the occupants must sign to indicate their approval. (43 KBytes, PDF) |
TIC Corner Column for May 2005
What is the significance of the San Francisco Board of Supervisors' recent disapproval of a condo conversion? |
Condo Conversion 101
San Francisco Apartment Magazine article with basic information on condominium conversions. |
Condominium Conversion In Oakland
A description of Oakland's condominium conversion requirements (589 KBytes, PDF) |
|
| Homeowners Associations (HOAs) |
|
Homeowners Associations (HOAs) Questions and Answers
More and more California homes are part of a homeowners association, condominium association, or community association. This article answers many of the questions commonly asked by HOA members (the owners of condominiums and other homes governed by owners associations), HOA managers, HOA directors, and HOA officers. |
Homeowners Association Rewrite Program
The documents governing homeowners associations, called the covenants, conditions and restrictions (CC&Rs), bylaws and rules, need regular updating or revision to accommodate changing circumstances, comply with the latest law, and remove obsolete provisions relating to development and sale of the project. Associations also replace their governing documents because the old documents are hard to understand and/or use, or do not effectively deal with the real problems of the association. I have developed "plain English" CC&Rs which I believe to be clear and easy to follow. Together with the law firm of Bickel & Associates, I offer a fixed-fee program for updating, improving and replacing old or bad CC&Rs. If you are interested in this program, please use this link for more information.
|
The Condominium Bluebook
Branden Bickel and I have written a reference book containing a wealth of information about condominiums and planned developments in California. It contains detailed answers to the questions most commonly asked by property owners, Realtors(c), homeowners association officials, and property managers, along with useful forms, checklists, and step-by-step instructions for most homeowners association functions. It also collects virtually all of the laws relating to the day-to-day operation of a condominium project and planned development, including statutes from the Civil Code, Corporations Code, Code of Civil Procedure, Evidence Code, Vehicle Code, Labor Code, Health & Safety Code, United States Internal Revenue Code and California Revenue & Tax Code.
Each chapter of the Condominium Bluebook is divided into sections with descriptive headings. A detailed Table of Contents at the beginning of the book collects all of the headings, and includes every question in the "Questions and Answers" chapter, the descriptive title of each statute, and the topic of each checklist and form. The index at the back of the book provides a comprehensive alphabetical listing of key words and phrases.
If you are interested in buying a copy of The Condominium Bluebook, please use this link. |
Davis-Stirling Act
Principal law governing homeowners associations (997 KBytes, HTM) |
Definition of Limited Equity Housing Cooperative
California Health & Safety Code Section 33007.5 (11 KBytes, HTM) |
|
| Unmarried Couples and Domestic Partners |
|
Unmarried Couples and Real Estate Ownership in California
This pamphlet provides comprehensive information on real estate and home ownership by domestic partners and unmarried couples in California. |
|
| Evictions and Related Landlord/Tenant Matters |
|
Proposed Ellis Act Amendment
The most recent version of SB 464 would allow only those who have owned for at least 3 years to use the Ellis Act to evict. The new restriction would apply only to owners who bought after March 26, 2007. (73 KBytes, PDF) |
San Francisco Requires Higher Eviction Payments
In November 2006, San Francisco votes approved a new law that requires higher payments to tenants in connection with certain types of evictions. This article explains the new requirements |
25% Ownership Needed For SF Owner Move In Evictions
A recent court decision has finally clarified that 25% (rather than 50%) ownership is needed for an owner to qualify to evict a tenant under San Francisco rent control's owner move in rules. The case resolves a conflict between two laws that were enacted within a few months of each other in 1998. |
Owner Occupancy and Ellis Evictions
Rent control laws interfere with owner-occupancy in some communities. In California, the Ellis Act provides a way for owners anywhere in the state to evict tenants (despite rent control) in order to make a building available for owner occupancy. In San Francisco, the owner move-in laws provide a second, alternative basis for eviction. This pamphlet provides a comprehensive explanation of Ellis Act and owner move-in rules, as well as related topics such as tenant buyouts. |
Ellis Act Eviction Statistics
Recent eviction statistics and trends for San Francisco (350 KBytes, PDF) |
| Text of the Ellis Act |
| San Francisco Rent Control Law |
| San Francisco Rent Board |
Small Property Owners Website
Includes a sample Rental Agreement |
|
| Real Estate Basics |
|
Basic Information for First-Time Home Buyers
The process of buying and selling real estate is full of terms and procedures that are completely new to first-time buyers. This article will help you master the basics of buying real estate in California. |
Real Estate Lending and Mortgage Loans
Most first-time buyers find mortgages hopelessly complicated and arbitrary, and they are absolutely right. But a basic understanding of the players and the plays can make the loan qualification process considerably less frustrating. This aticle will provide the tools you need to understand mortgages and choose the mortgage that is right for you. |
|
