Quoting price without a license - Posted by Gobstomper

Real Estate Investing Real Estate Law
1

Posted by Bill H on October 08, 2003 at 10:39:29:

  1. Sounds to me like your “Ill egal” in this case is a SICK BIRD!.

  2. There is no law I am familiar with that says I cannot call from my home in Montana to a seller in California, over the phone, (not with a long string and a pair of tin cans. )and tell them I will pay xxx dollars for their property.

  3. Do not know anything about your college professor but there are those who can and do and those who teach.

  4. Yes, the more you know about whatever you are attempting to do the less likely you are to go astray in the pitfalls of any activitiy. If at first you do not succeed at skydiving…it ain’t for you!

  5. Bringing up to code is required anywehere in the USA. It merely means that you have to make the place habitable to live in…It can, in some cases be expensive, we call it “Re-Habbing.” However; you do not have to rebuild the Taj Mahal.

  6. Define expert for me. "EX’ a has been and “SPERT” Is a drip under pressure. Opinions are a dime a dozen and most of them are useless.

  7. GO FOR IT! Whoever is talking to you so NEGATIVELY is full of it.

Good Luck,

Bill H

2

Quoting price without a license - Posted by Gobstomper

Posted by Gobstomper on October 07, 2003 at 21:29:04:

I’m a newbie at real estate investing. I live in Los Angeles where I’m told by some, especially real estate agents that I require a real estate license to “quote” or ask a price of a property that I wanted to buy. To do so on a phone for example without the license is illegal, according to them. Is this true? Does this also mean that I can’t deal directly with a seller over a deed and contract at an agreed to price (since I can’t because I lack a license)?

3

Re: Quoting price without a license - Posted by Arnold

Posted by Arnold on October 08, 2003 at 08:24:55:

Who ever told you that is nuts.

In California you can ask about price, quote prices, buy, or sell for your own account without fear of running afoul of the law.

You don’t need any education at all, nor is any required. However, the more education and experience you have the better.

On the other hand, having a real estate license brings with it a whole nother set of rules. Check with the department of real estate for the particulars.

4

Re: Quoting price without a license - Posted by Tom-FL

Posted by Tom-FL on October 07, 2003 at 22:11:00:

I don’t know about that. Sounds just a little screwy to me. Don’t you have BUY OWNER magazine out there or ads in the paper of houses for sale by the owner? How about For Sale By Owner signs in front of houses?

5

Re: Quoting price without a license - Posted by Gobstomper

Posted by Gobstomper on October 07, 2003 at 23:39:37:

Tom what they say doesn’t really make to much sense to me also.

Well I live in California (LA County to be exact) and I talked to these experts, and bargaining over a price on the telephone for example is illegal (I met up with a real estate agent at 5 o’ clock today who told me if his wife, who is unlicensed, was to put a price on a property she wanted to buy, that it would be ILLEGAL). The guy also told me if I wanted to get into real estate at all, investor or not, I needed to take 3-6 months studying for a real estate license, just so I can price, appraise a property I am willing to buy. Does what this guy say even true, I am from Southern California after all.

I have another question. I know a college professor who used to be a either a mortgage broker or a real estate agent (he tried two years at it back in the eighties and seems to have been unsucessful) and he said to me that it would be IMPOSSIBLE to go into real estate investing in my geographic area due to the fact that houses here must be “up to code” with the city and state. Basically if I buy a house here in SOCAL, that the costs to bring a house “up to code” especially a “junker” and/or vacant property, that it would generally mean a loss of investment instead, at least in his opinion. He’s the expert not me, but is he generally right on such a claim about RE investing in Southern California? Can anyone vouch for or against him?

I am a college student and their advice might reflect that, be it right or wrong, or partially correct.

Gobstomper

6

Re: Quoting price without a license - Posted by Tom-FL

Posted by Tom-FL on October 08, 2003 at 23:21:45:

It all sounds just a little goofy to me.

What this guy is telling you is that no one is allowed to buy a house unless they are an agent or have an agent. That borders on the absurd. Although there is a thread going on at the main news group about some states limiting you to 5 deals a year without some kind of license.

I’m wondering if he thinks you are planning to “price” houses for a fee. That would make you an appraiser and subject to the licensing standards for that activity. I can see that. That said, his wife, or you or me or anyone can call up and make an offer. That’s what the house is worth TO US. Maybe the guy is concerned about you quoting the “Market Value” of the house as a fact. But then, we are talking about appraisals again, not a guy making an offer on a house.

As to question #2, it is entirely possible in some areas that houses are inspected in some fashion by the government at time of sale, and thus are checked for code. I’d think that would produce a lot of irate voters though. In most places, if the code changes, the existing housing stock is grandfathered in. Otherwise, you really would have to spend outrageous amounts to upgrade a house to sell it if you own it more than a few years. The codes change depending on which way the wind blows, and who is in power. I would think around here that a 15 year old house would have to meet so many new stipulations that it would be cheaper and easier to knock it down and start over rather than try to upgrade it.

That said, it is true that if you START something and pull a permit, sometimes the whole system has to be upgraded because you touched it. Let’s say you have a house that is so old that the wires run individually through the walls on ceramic insulators. Now, you decide to upgrade the circuit box from the 60 amp fuse box to a 200 amp circuit breaker setup. Well, now it wouldn’t suprise me a bit if you were facing a complete rewire, because you tinkered with it. Had you left the old box alone, you probably would not have had to change the wires, because they were code at the time the house was built. Be very careful starting “simple” projects.

At any rate, even if you DID have to meet current code on every house, you just build that into your purchase price. So what if you lost a deal cuz another guy offered more, you know he’s going to take a bath. You should be glad it wasn’t you.

A good rule of thumb is to take the price you think it’s worth, times 70%, minus repair costs. So you have a 200k house. Start with 140k (70% X 200k), then if the repairs to bring it up to code are 100k (good golly), then offer 40k. Your guy probably wasn’t buying right so now he’s trying to discourage you in the business.

They may also be honking on you because you’re young too.