Real Estate Law

Gottlieb Law - Understanding Commercial Real Estate Law in Arizona
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Growing and Protecting Your Portfolio: Understanding the Complexities of Commercial Real Estate Law in Arizona
Growing and Protecting Your Portfolio: Understanding the Complexities of Commercial Real Estate Law in Arizona 1773 1182 Gottlieb Law
Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Commercial real estate in Arizona can be a lucrative investment, but navigating the legal landscape can be challenging. There are a number of laws and regulations that property owners and tenants must follow, which govern everything from zoning and building codes to tenant rights and environmental regulations. It is important to understand these laws to avoid legal disputes, ensure compliance, and protect your portfolio.  That being said, the law takes a relatively “hands-off” approach to commercial real estate, assuming that commercial real estate investors, landlords, and tenants are sophisticated parties. 

In this guide, we will provide an overview of some of the key commercial real estate laws in Arizona that property owners and tenants need to know. Whether you are a landlord, tenant, or real estate investor, this information can help you maneuver the legal complexities of commercial real estate in Arizona. 

Lease Agreement

The lease agreements executed with tenants is the key, operative legal document that must be reviewed carefully.  The lease agreement will generally contain provisions relating to the security deposit, intended use of property by the tenant, commencement date, rental rate, length of tenancy, rights of renewal, maintenance obligations of the tenant and landlord, insurance, default, and remedies.  

Property owners and real estate developers in Arizona should work with an experienced real estate attorney to ensure any leases signed before a project’s completion are realistic and attainable and contain necessary provisions.

Right to Quiet Enjoyment

Many commercial leases have provisions pertaining to the right of quiet enjoyment, which in Arizona is a legal principle that protects tenants from having their peaceful enjoyment of the property disturbed by their landlord or anyone else who might interfere with their use and enjoyment of the property. If a landlord violates a tenant’s right to quiet enjoyment, the tenant may be able to take legal action against the landlord.  It’s important to note that the right to quiet enjoyment is not absolute and may be limited in certain circumstances, such as when the landlord needs to enter the property to make repairs or address an emergency situation.

Subleasing Commercial Property in Arizona

Commercial tenants in Arizona can typically sublease or assign their lease to another party, unless expressly prohibited by the landlord in their lease agreement. The landlord should be aware of this right and the lease should contain provisions protecting the landlord’s interests if the landlord does not want the property subleased.  

The addition of a clause requiring landlord approval for any sublease or assignment can give the landlord peace of mind and keep the decision in their hands. While most landlords may prefer to have a tenant through subletting or assignment rather than no tenant at all, it is important to be aware of this right and take the necessary steps to protect their property and interests.

Arizona Commercial Evictions

Regrettably, those who have owned or invested in property may have encountered tenants who have not fulfilled their obligation of paying rent. In such cases, landlords should review their lease to determine if a lockout is permissible, and if so, ensure they adhere to the necessary protocol. According to state law, and if not provided any further rights in the lease agreement, tenants have a period of five days to pay rent once due, and upon the expiration of that timeframe, the landlord may lawfully enter and regain possession of the premises, in accordance with A.R.S. § 33-361.

In the event that the landlord takes possession of the premises, it shall possess a lien on all of the tenant’s personal property and may hold it as a means of demanding payment.  The landlord generally provides notification prior to a lockout or sale taking place, and the majority of lease agreements necessitate notification. 

Landlords should consider each situation on a case-by-case basis and may want to seek advice from an experienced commercial real estate attorney.

Find an Experienced Arizona Real Estate Attorney

These are just a few of the main commercial real estate laws in Arizona that property owners should be aware of. It is important to consult with a qualified attorney to ensure compliance with all applicable laws and regulations.

The attorneys at Gottlieb Law have provided industry-leading legal representation to our clients in all things real estate law in Arizona. We work with individuals and businesses on everything from their first home purchase to complex development projects.  Contact our firm today at 602-899-8188 to schedule an initial consultation or make an appointment on our contact us page.

Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Gottlieb Law - Common Legal Disputes for Arizona Homeowners
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Common Legal Disputes for Arizona Homeowners: Navigating Boundary Disputes and HOA Conflicts
Common Legal Disputes for Arizona Homeowners: Navigating Boundary Disputes and HOA Conflicts 1773 1182 Gottlieb Law
Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Owning a home can bring with it a variety of legal issues, including boundary disputes, homeowner association conflicts, and even construction defects. Boundary disputes involve disagreements over the legal boundaries between two or more properties, and HOA conflicts are disagreements between a homeowner or homeowners and/or their community association. These disputes can be complex and costly, especially if they are not handled properly from the first sign of a potential legal dispute. To help navigate these issues, it’s important for Arizona homeowners to understand the basics of the legal system and the specific laws related to boundary disputes, HOA conflicts and other common legal disputes. 

In Arizona, boundary disputes are typically resolved by reviewing a survey or the property description set forth in the recorded deed.  Meanwhile, HOAs are governed by applicable governing documents and state laws. Understanding these laws can help ensure that both parties understand their rights and obligations and can often help them resolve their disputes without the need for legal action. 

It’s also important for Arizona homeowners to be aware of the potential consequences of boundary disputes and HOA conflicts. Depending on the situation, these disputes can have significant financial implications and may even result in long-term damage to relationships between neighbors or between homeowners and their associations. Understanding the legal system and the laws and provisions that apply to boundary disputes and HOA conflicts can help homeowners avoid costly and drawn-out legal disputes, and can help ensure that all parties involved are better able to reach a resolution. 

Arizona homeowners should be aware of the legal issues associated with boundary disputes, HOA conflicts and some other common legal disputes. One of the best ways to avoid unnecessarily drawn out legal matters is to hire an experienced real estate attorney at the first sign of a potential legal dispute.  They can help review the matter, determine your rights and work towards a fair resolution.

Property Boundary Disputes in Arizona

Boundary disputes are common legal issues that Arizona homeowners must be aware of. A boundary dispute is a disagreement between two or more parties over the property line or lines of a given piece of land. These disputes can arise when a homeowner believes that their neighbor has crossed the property line and encroached upon his or her land, or when two neighboring homeowners disagree about the location of the property line. Common causes of boundary disputes include unclear descriptions in deeds or other documents, incorrect survey results, and an incorrect assumption of the property line by homeowners. It is important for Arizona homeowners to know how to handle a boundary dispute if one arises. The first step is to try and resolve the dispute informally with the neighboring homeowner. If that does not work, there are steps that can be taken to resolve the dispute legally, such as filing a complaint in court, hiring a professional surveyor, and/or seeking mediation or arbitration. Knowing how to navigate a boundary dispute is important for Arizona homeowners to ensure that their property rights are protected.

If you are facing any type of boundary dispute, start by making sure you have evidence of the proper boundary lines.  The first place to review is the property deed.  It should provide the legal description of the property in question. Bringing the legal description of the property boundary to your neighbor’s attention may enable you and them to work out the issue amicably, without needing to resort to the legal process. By referencing both of the property deeds, you may be able to settle the matter with the facts.

In many cases of disagreement over a boundary, it can help to point to the facts presented on the deed and discuss the other party’s goals.  Maybe selling some of your land or coming to an agreement on an easement will allow your neighbor to accomplish their goal, while fairly compensating you.  If a straightforward discussion of the facts does not resolve the matter, then it is important to understand that you will likely need the representation of a real estate attorney with significant experience in boundary disputes.  In all cases, it is important to consult with qualified counsel before taking action, to confirm your legal rights.

Arizona HOA Conflicts

HOA conflicts are another common legal issue that Arizona homeowners can face. An HOA conflict is a disagreement between a homeowner and their homeowners association, typically regarding the rules and regulations of the HOA. Common causes of HOA conflicts include disagreements about the enforcement of HOA rules, disputes over the payment of dues or assessments, and violations of the HOA’s covenants, conditions and restrictions. It is important for Arizona homeowners to know how to handle an HOA conflict if one arises. 

The first step is to try and resolve the dispute informally with the board of directors of the HOA.  This can be as simple as presenting your case to board members you know and, if necessary, scheduling a review of the matter.  Make sure you are prepared with facts and evidence that backup your side of the issue.  Generally, just being unhappy with a ruling or action by the association is unlikely to get it changed.  You will want to point out rules or regulations that support your position or detail how the rules were too vague. 

If that does not work, there are steps that can be taken to resolve the dispute legally, such as filing a complaint in court and/or seeking mediation or arbitration. Knowing how to navigate an HOA conflict is important for Arizona homeowners to ensure that they are protected from any unfair or illegal actions taken by the HOA.  These actions should not be taken lightly.  Before proceeding with any legal action against your HOA, it is essential to review the matter with an experienced real estate attorney that can determine if your matter has legal standing and merit.  An attorney can help assess the best course of action and help draft a complaint if needed.

Construction Defects and Other Common Legal Issues 

In addition to boundary disputes and HOA conflicts, Arizona homeowners may face other common legal issues. These can include construction defects, deed restriction disputes and more. When faced with any of these issues, it is important that homeowners understand their legal rights and take the necessary steps to protect themselves. 

Common causes of other legal issues may include poor construction quality, faulty building materials, a lack of proper building permits, or a failure to properly maintain the property. It is important for homeowners to be aware of the standards of care that are expected to keep their properties safe and in good condition. 

If homeowners find themselves in a dispute with a contractor or other party, it is understandable to attempt to resolve the matter with a direct conversation with the contractor or responsible party.  For any serious construction defects or issues with your property, homeowners should consult with a qualified attorney who can advise them on their legal rights and provide guidance on how to proceed. The attorney can also help to negotiate a settlement or represent the homeowner in court if necessary.  Many times, there can be issues that go beyond the first visible signs.  You want to work with professionals that can accurately assess the full extent of any defects and help determine what is necessary to completely resolve the matter. 

No matter what legal issue Arizona homeowners may face, it is important to be aware of their rights and take the necessary steps to protect themselves. By understanding the legal issues they may face, they can be better prepared to navigate any potential disputes or conflicts.

The Value of Having the Best Real Estate Attorney

It is essential for Arizona homeowners to be aware of the common legal disputes that may arise, such as boundary disputes and HOA conflicts. Boundary disputes involve disagreement between two or more property owners about the exact location of a property line. These disputes can arise from a variety of sources, such as a lack of an accurate survey of the property, unclear language in a deed, or an error in a legal description. HOA conflicts can arise when a homeowner fails to comply with the rules and regulations of the HOA, such as failing to pay dues or making unauthorized alterations to the property. Both of these disputes can have serious legal and financial consequences, so it is important to understand how to handle them.

Many homeowners face their first legal dispute completely unprepared and they end up spending more time and money on the issue than needed.  Having great representation from an experienced real estate attorney can help homeowners resolve common legal disputes before they become a major issue.  The attorneys at Gottlieb Law have provided clients with exceptional legal representation on all types of real estate matters from common disputes to complex transactions.  Contact our firm today at 602-899-8188 to schedule an initial consultation or make an appointment on our contact us page.

Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Gottlieb Law - 5 Major Benefits of a Great Real Estate Lawyer for Arizona Real Estate Investors
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5 Major Benefits of a Great Real Estate Lawyer for Arizona Investors
5 Major Benefits of a Great Real Estate Lawyer for Arizona Investors 2560 1707 Gottlieb Law
Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Whether you are looking to buy your first investment property or you are a veteran real estate investor, there are many complications and nuances to successful real estate investments.  Missing an important detail or misunderstanding local regulations can make the difference between making savvy investments and dealing with a nightmare transaction. Great real estate lawyers are experienced and knowledgeable on all things involved in real estate transactions. They are trained to advise clients on their rights, obligations, and legal options in all matters related to real estate transactions. Great lawyers can help advise throughout the process and make sure you are considering all the key details of every transaction.  A great real estate lawyer can provide many substantial benefits to real estate investors and anyone involved in the real estate industry.  Here are the top 5 major benefits of a great real estate lawyer in Arizona for real estate investors.  

Benefit #1: Knowledge of Local Laws and Regulations 

The first benefit of hiring a great real estate lawyer is that they can help investors understand the legal complexities of real estate transactions. A great real estate lawyer will be able to explain the legal implications of a potential transaction, ensuring that the investor understands their rights and obligations. They will also be able to provide advice and guidance when it comes to negotiating contracts and other legal documents, such as leases and mortgages.

One of the biggest advantages of working with a knowledgeable and experienced real estate lawyer is the understanding they have of Arizona’s real estate laws. From zoning laws to easement laws and other important laws impacting real estate, they can provide guidance on the legal aspects of owning and investing in property. These laws can be complex and are constantly changing, which is why having an experienced lawyer that focuses on these details on your side is so important. They can help make sure you are compliant with the local regulations and can assess potential risks and liabilities. Not only can they advise on the best strategies for managing those risks, but they can also provide guidance on how to avoid them in the first place.

Experienced real estate lawyers can help investors navigate the zoning and zoning restrictions of a particular area. A great real estate lawyer will be able to explain the zoning regulations of a particular area and advise the investor on how to navigate them. This can help the investor avoid costly mistakes and delays when it comes to purchasing or selling a property.

Benefit #2: Negotiating Contracts  

Having a great real estate lawyer in Arizona can provide many benefits for real estate investors. In particular, a great real estate lawyer can help with negotiating contracts. They can draft and review contracts, negotiate terms and conditions, and ensure compliance with disclosures. This can be incredibly beneficial for real estate investors, as it allows them to have a professional review the contract to make sure all terms and conditions are in their best interests. Additionally, a real estate lawyer can help negotiate with the other party to make sure that the terms of the contract are fair and equitable to both parties. Furthermore, they can make sure that all disclosures are properly made and that all parties are aware of their rights and obligations. All of these benefits can help real estate investors make sure that their investments are secure and that their rights are protected.

Another benefit of hiring a great real estate lawyer to assist with contract negotiation is that they can help protect an investor from potential liability. A real estate lawyer can review the transaction and associated contracts to ensure they are legally sound and advise the investor on potential risks. They can also help the investor protect their interests in the event of a dispute or lawsuit.

Benefit #3: Representation in Court 

Having a great real estate lawyer on your side is essential when it comes to representing you in court proceedings. This could be especially beneficial for real estate investors, as they may face legal disputes from time to time. An experienced real estate lawyer in Arizona can provide representation in disputes, as well as during mediation or arbitration that may arise. This can help to ensure that your interests are being looked after and that your rights are being respected. Furthermore, real estate investors will need an experienced lawyer with representation in court, should any dispute escalate to that stage. This can be especially important, as the court system can be difficult to navigate and understand. Having a legal professional on your side can help to ensure that you are abiding by the law and that you are being represented properly. This can provide a great sense of security and reassurance to real estate investors as they look to grow their portfolio and manage many properties.

Benefit #4: Representation in Transactions

Having a great real estate lawyer in Arizona by your side during transactions can be a major benefit for real estate investors. Your lawyer can assist you in negotiations to ensure that your interests are protected and that the deal is fair and reasonable. During the closing process, your lawyer will review all the documents to make sure the terms of the agreement are being adhered to and that all the key details are in order.  They will also help you with any title and escrow issues that may arise. Title issues can be complex, and your lawyer can help you navigate the process and identify any potential issues so they can be resolved in a timely manner. Having a lawyer with experience in real estate transactions in Arizona can be invaluable and can help you protect your interests throughout the entire process.

While some matters will require an experienced accountant or financial advisor, a great real estate lawyer can also help explain the various implications of a potential transaction.  Following sound strategies for growing your wealth to your advantage obviously provides the best opportunity to be a successful real estate investor in the long run.

Benefit #5: Professional Advice 

Having a great real estate lawyer can provide professional advice that can be invaluable to real estate investors. Not only can they provide advice on complex matters, they can also give access to professional networks that can further their client’s goals. Moreover, a great real estate lawyer can provide guidance on business strategies that can benefit the investor in the long run. For example, an Arizona real estate lawyer can assist in the process of renegotiating a lease agreement. Having access to a professional network can open up opportunities for an investor to find the best deals on both residential and commercial properties as well. 

Furthermore, a great real estate lawyer can provide advice on strategies to maximize the value of their investments, such as researching market trends, developing marketing plans, and analyzing potential investments. Arizona real estate lawyers can also provide guidance on how to navigate complex legal issues, such as zoning restrictions, easements, and construction regulations. Ultimately, having a great real estate lawyer on your side can help you maximize the value of your investments and achieve your goals.

Finding the Best Real Estate Lawyer in Arizona for Your Needs

While each real estate investor will certainly need to figure out how involved they would like their real estate attorney to be in their transactions, it should be clear to every investor that they need to have a great real estate attorney as part of their team.  Even the most savvy and experienced investors know that having expert representation to review deals and contracts can help avoid common pitfalls and mistakes.  The attorneys at Gottlieb Law have provided industry-leading legal representation to our clients in all things real estate law in Arizona.  We work with individuals and businesses on everything from their first home purchase to complex development projects.  Contact our firm today at 602-899-8188 to schedule an initial consultation or make an appointment on our contact us page.

Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Gottlieb Law - Resolving Landlord Tenant Disputes in Arizona
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Resolving Disputes Between Landlords and Tenants in Arizona
Resolving Disputes Between Landlords and Tenants in Arizona 1773 1182 Gottlieb Law
Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Residential landlords and tenants may have disputes for a variety of reasons, including issues with the property, the terms of the lease or disagreements about repairs and maintenance. Some common issues that can lead to disputes include non-payment of rent, unauthorized subletting, damage to the property, disagreements over security deposits and other situations. These disputes can arise due to lack of understanding or communication, or due to a lack of trust.

Regardless of why disputes arise, landlords and tenants in Arizona should understand their rights and tread carefully as they look for an appropriate resolution. It is always wise to consult an experienced real estate attorney when navigating any type of controversy with potential legal consequences. In the meantime, this is what Arizona landlords and renters need to know about resolving disputes.

Common Disputes Between Landlords and Tenants

In Arizona, some common disputes between landlords and tenants include issues with rent payments, property damage and violations of lease agreements.

One common issue is non-payment of rent. This can occur when a tenant falls behind on their rent payments, and the landlord may choose to evict the tenant as a result. A.R.S. § 33-1368(B) states that landlords must provide notice to the tenant that rent is late, and the tenant has five days to pay the rent and any applicable late fees as per the terms of the lease. Only after the final day of notice can the landlord file an eviction action if the tenant still has not paid.

Another common dispute is over property damage. Landlords may dispute with tenants over damages caused to the property during the tenant’s occupancy, and may deduct the cost of repairs from the tenant’s security deposit. However, per A.R.S. § 33-1363, landlords who do not address necessary repairs in a timely manner may be required to pay a licensed contractor for work done on the property. A related issue is with security deposit disputes — tenants may dispute the deductions taken by landlords from the deposit, claiming the damages were pre-existing or that the landlord did not properly document the damages.

Violations of lease agreements is also a common reason landlords and tenants quarrel. Tenants may violate the terms of the lease by subletting the property without permission or having unauthorized occupants, or by keeping pets in a pet-free property. Landlords may take action to evict the tenant or impose penalties as a result.

Lastly, disputes over maintenance and repairs are incredibly common. Landlords may neglect to make necessary repairs to the property, or may delay repairs, leading to disputes with tenants.

Landlord Rights in Arizona

As a landlord in Arizona, you have several rights, including but not limited to the following:

  •       The right to collect rent: Landlords have the right to collect rent from your tenants according to the terms of the lease agreement.
  •     The right to access the property: Landlords have the right to access the property for the purpose of inspection, maintenance, or repair, but must give the tenant reasonable  (typically two days) notice before entering the property.
  •       The right to evict tenants: Landlords have the right to evict tenants in violations of the lease agreement terms or fail to pay their full rent. However, they must follow the proper legal procedures for eviction.
  •       The right to retain a security deposit: Landlords have the right to retain a security deposit to cover any damages caused by the tenant or unpaid rent. Keep in mind, the landlord must create a detailed and itemized list of all deductions and promptly provide it to the tenant.
  •       The right to set and increase rent: Landlords have the right to set the rent for the property and increase it as long as it’s done in accordance with the state laws and any lease agreements.
  •       The right to terminate the lease: Landlords have the right to terminate a lease agreement if the tenant violates the terms of the lease or for other reasons as stated in the lease agreement.

It is important to note that all these rights must be exercised within the framework of state laws and regulations, and it is always advisable to seek legal advice before taking any action.

Tenant Rights in Arizona

Residential tenants in Arizona also have their own set of rights detailed in the Arizona Residential Landlord and Tenant Act, including the following:

  •       The right to a safe and livable space: Tenants have the right to live in a property that is safe and in good working order. Your landlord is responsible for making sure that the property is free from hazards and that any necessary repairs are made in a timely manner.
  •       The right to privacy: Tenants have the right to privacy in your rental unit. Your landlord must give you reasonable notice before entering your unit and can only enter for specific reasons, such as emergency repairs or inspections.
  •       The right to a fair and timely return of your security deposit: Tenants have the right to a fair and timely return of your security deposit. Your landlord must return your deposit within 14 days after you move out, unless deductions were made for unpaid rent or damages.
  •       The right to pursue legal action against your landlord: If your landlord violates your rights, tenants have the right to pursue legal action against them to resolve the dispute. This can include filing a complaint with a government agency or filing a lawsuit.
  •       The right to be protected from discrimination: Tenants have the right to be protected from discrimination on the basis of race, color, religion, sex, familial status, national origin, or disability.
  •       The right to quiet enjoyment: Tenants have the right to quiet enjoyment of the rental property, free from undue disturbance from the landlord or other tenants.

It is important to note that all these rights must be exercised within the framework of state laws and regulations, and it is always advisable to seek legal advice before taking any action.

How to Resolve Disputes Between Landlords and Tenants

It’s best to try resolving disputes between landlords and tenants in Arizona without going to court, but legal counsel may be necessary if disputes cannot be easily mediated. Reasons for disputes between landlords and tenants can vary, but having the assistance of an experienced real estate attorney can help settle disagreements fairly and efficiently.  The attorneys at Gottlieb Law are well-versed in landlord and tenant disputes in Arizona.  We can quickly review your dispute and help guide you to a resolution.  Contact our firm today at 602-899-8188 to schedule an initial consultation on your dispute or make an appointment on our contact us page.

Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Gottlieb Law - Impact of Zoning and Land Use Laws on Real Estate Investing
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The Impact of Zoning and Land Use Laws on Real Estate Investing in Arizona
The Impact of Zoning and Land Use Laws on Real Estate Investing in Arizona 1773 1182 Gottlieb Law
Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

For real estate investors in Arizona, understanding local zoning and land use laws is crucial for avoiding costly errors and being able to use property for its intended purpose. Zoning and land use laws regulate the types of activities that can take place in different areas of a city or town, and they can have a significant impact on real estate investing. In Arizona, these laws are generally established and enforced by local governments, such as cities or towns, which means investors must do their due diligence whether their desired property is in the Valley or beyond.

Zoning Laws in Arizona

Zoning laws in Arizona divide a city or town into different zones, each of which is designated for a specific type of use, such as residential, commercial, industrial or sometimes mixed use zones. The specific types of activities allowed in each zone (how property can be used, what can be built on it, and where and how it can be built) are typically set forth in the local government’s zoning code or land use plan.

In Arizona, state law provides a framework for local governments to establish and administer their own zoning and land use regulations, meaning cities and towns have the power to regulate the use of land within their boundaries.

Specifically, the Zoning Enabling Act, found in A.R.S. 9-462, sets forth the general principles and procedures that local governments must follow when establishing and enforcing zoning regulations. This statute provides that local governments may adopt zoning ordinances that regulate the use, height, bulk, location, and density of buildings and structures within their boundaries, as well as the use of land for other purposes.

Another important statute to note is related to Arizona subdivision laws, A.R.S. 32-2181. This statute regulates the division of land into smaller parcels, such as for residential or commercial development, and requires developers to submit plans for approval. It also provides for the creation of zoning and land use plans to guide the development of subdivided land and is intended to protect the public safety and welfare.

It is worth noting that these are only examples, and there are many other laws and regulations that may be relevant to real estate investors, depending on the specific circumstances of their investments.

Property owners who wish to use their land for something outside of current zoning restrictions may apply for a “variance,” or an exception to the rule. Zoning laws vary greatly among cities and towns, but use variance cases that protect one’s property rights and do not change the nature of the surrounding area may be granted a variance by the zoning authority. It is wise to apply for any needed variance before construction begins, as penalties for defying zoning laws include civil fines and may result in litigation.

Land Use Restrictions in Arizona

Land use restrictions in Arizona are regulations that limit the way that land can be used and developed. These restrictions are also established by local governments through zoning ordinances or land use plans, or they can be imposed through private agreements, such as covenants, conditions, and restrictions (CC&Rs) that are attached to a property. To differentiate, remember this: Land use refers to how property owners develop land to suit their needs, and zoning is how the land is regulated by the government.

Land use restrictions can take many different forms and can achieve a wide range of objectives, such as preserving open space, protecting the environment, or promoting certain types of development. Some common examples of land use restrictions in Arizona include:

  •       Height limits: Limit the height of buildings or structures on a property.
  •       Setback requirements: Specify the minimum distance that buildings or structures must be set back from property lines or other features, such as roads or waterways.
  •       Building density: Limit the number of buildings or units that can be constructed on a piece of land.
  •       Use restrictions: Set forth the types of activities that can be conducted on a piece of land, such as prohibiting certain types of businesses or prohibiting the use of a property for certain purposes, such as farming or logging.
  •       Environmental protections: Protect natural resources or sensitive ecological areas, such as habitats for endangered species.

In short, land use restrictions give communities a uniform look and feel, and they keep everything organized by separating areas with varying noise levels, crime levels and pollution. They also create more desirable neighborhoods and areas of town, which can mean higher ROI for real estate investors.

Therefore, investors should be aware of any land use restrictions that may apply to a property they are considering purchasing, as these restrictions can significantly impact the value and use of the property.

How Zoning and Land Use Laws May Impact Your Arizona Real Estate Investment

As a real estate investor, it is important to understand the zoning and land use laws in the area where you are considering buying property. These laws can affect the types of properties you can purchase and the types of activities you can do on them. For example, if you are interested in buying a property to turn it into a rental property, you will need to make sure that the property is in a zone that allows for rental units or that there are no other restrictions preventing the property from being utilized as a rental property. Similarly, if you are considering buying a piece of land to build on, you will need to ensure that the land is zoned for the type of development you have in mind and that you comply with any relevant land use regulations.

It is also worth noting that zoning and land use laws can change over time, so it is important to stay up-to-date on any changes that may affect your investment.

Find an Experienced Arizona Real Estate Attorney

Navigating zoning and land use laws during the due diligence process can be difficult, especially in a fast-paced real estate market. It is important to work with experienced attorneys that can help guide you through the process and make sure you can use your property for your desired purpose.

If you are looking to invest in real estate in Arizona, the experienced attorneys at Gottlieb Law can represent your interests throughout the entire process. Contact us today at 602-899-8188 to schedule an initial consultation or make an appointment on our contact us page.

Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Gottlieb Law - Real Estate Due Diligence Checklist for Investors
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The Importance of a Thorough Real Estate Due Diligence Checklist for Successful Investors
The Importance of a Thorough Real Estate Due Diligence Checklist for Successful Investors 2160 1412 Gottlieb Law
Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Due diligence is an important concept for any real estate investor to understand. It is the process of researching and evaluating a potential investment opportunity to determine if it is a wise investment. This includes researching the property itself, the local market, and the legal and financial aspect of any potential deal. Good due diligence requires a comprehensive and thorough evaluation of the investment opportunity to ensure that the investor is making a responsible and informed decision. 

When evaluating a potential investment, the investor must consider all the costs associated with the purchase and any potential issues that may arise. It is important to consider the condition of the property, any zoning or tax issues, and the current market value of the property. Furthermore, it is advisable for investors to conduct thorough investigations into the local market conditions to ascertain whether the property is situated in a region poised for substantial value growth.

Proper due diligence involves researching the seller, the property, and any potential tenants. It is crucial to confirm that the seller possesses the legitimate authority to transfer the property and that there are no unresolved claims, liens or encumbrances. Having an experienced real estate attorney and a good title company will help with this aspect of the process.  Every investor ought to examine the property to ensure its satisfactory condition and determine if any repairs or enhancements are required. Finally, the investor should research potential tenants to make sure that they are financially stable and will be able to pay rent.

Thorough and meticulous due diligence is imperative for every real estate investor in each transaction. This encompasses in-depth research into the property, the surrounding market, as well as the legal and financial facets of the deal. Real estate investors must be prepared to research the seller, the property, and any potential tenants. Taking the time to do due diligence can help ensure that the investor is making a responsible and informed decision.

Benefits of Thorough Due Diligence 

Due diligence is an important concept for all real estate investors to understand and execute. By investing the time and effort necessary to conduct thorough due diligence, a real estate investor can significantly reduce their risk, increase their efficiency, gain an improved negotiation position and maximize their potential return on real estate investments. 

One of the primary benefits of due diligence is that it reduces the risk associated with any real estate investment. By carefully investigating the details of a proposed transaction, an investor can identify potential issues that could have a negative impact on the investment. This acquired knowledge can subsequently be employed to facilitate wiser decision-making and prevent costly errors.

Establishing a detailed due diligence checklist for all real estate investments also increases the efficiency of the transaction process. By thoroughly researching the details of a potential investment, an investor can make decisions faster and more confidently, allowing them to capitalize on profitable opportunities when they arise. Moreover, diligent research can aid in the early detection of potential concerns, averting them from evolving into costly predicaments, thereby enabling investors to concentrate their resources on the most lucrative opportunities.

Due diligence also gives investors improved leverage in the inevitable negotiations that take place with real estate transactions. By having a detailed understanding of the proposed transaction, an investor can negotiate the best possible deal for themselves, ensuring that they are getting the most value out of their investment.  Completing a thorough analysis of the property will make the contracting process more efficient and help avoid common pitfalls that lead to legal and financial issues down the road.

Creating a Reliable Real Estate Due Diligence Checklist for Your Investments

Real estate due diligence can be time-consuming and complex, so it is important to have a thorough checklist to make sure nothing is overlooked. Any thorough real estate due diligence checklist should include a detailed financial analysis of the potential deal, an assessment of the property’s legal status, a review of the title and deed, an examination of the zoning regulations, an evaluation of the physical condition of the property, a review of the local market conditions, and an assessment of the potential risks associated with the property. Each of these topics is important and should be carefully researched before any real estate transaction is finalized. Here are some of the most important things to include in your due diligence checklist:

  • Research and Analysis: Research and analysis should be at the top of the list for any real estate due diligence checklist. Market research is an essential part of the due diligence process and should include researching the local economy and housing market. Property research should involve looking at the physical and legal aspects of the property in detail. It should also include inspecting the condition of the property, obtaining an appraisal, looking at zoning regulations, understanding the deed and title, and researching any potential environmental issues. Financial scrutiny should also be performed to gain insights into the economic feasibility of the property. This could include looking at financial statements, analyzing cash flow, and understanding the projected return on investment. While there are many other items to consider when completing a due diligence checklist, research and analysis should be at the top of the list. Investopedia put together a fantastic breakdown of the best real estate valuation method you can utilize in the financial analysis.
  • Documentation Review: When conducting due diligence on real estate, it is essential to review all relevant documentation. This includes title documentation, property documentation, and legal documentation. Title documentation should include all documents pertaining to the title of the property, such as the deed, title insurance policy, and any easements or restrictions in place. Property documentation should include any documents related to the physical property, such as survey maps, appraisal reports, and inspection reports. Lastly, legal documentation should include documents related to the laws and regulations that affect the property, such as zoning ordinances, land use restrictions, and enforceable covenants. Each of these documents is necessary to review in order to get a full understanding of the property and its associated risks. It is important to obtain copies of all documents to ensure that they are accurate and up to date. Furthermore, it is important to consult with an experienced real estate attorney who can review the documents and provide guidance on any potential risks associated with the property.
  • Property Inspection: When it comes to real estate due diligence, one of the most important things to include in your checklist is a property inspection with a professional real estate inspector in your area. This should include an exterior inspection to make sure the condition of the property is as advertised and that there are no issues that need to be addressed. The interior inspection should include a thorough examination of all fixtures, systems, and appliances, as well as any potential health and safety concerns. Lastly, it is essential to carry out a comprehensive structural assessment to verify the property’s structural integrity. This assessment should encompass an examination of the foundation, roof, walls, and all other significant structural elements of the building to confirm their good condition and absence of potential concerns. Taking the time to properly inspect a property prior to purchase is essential and should always be included in your real estate due diligence checklist.

How an Arizona Real Estate Attorney Helps with Due Diligence

Due diligence is a critical component of any real estate investment. It involves researching the property, understanding its current and potential value, and learning about the local market. The due diligence process also includes evaluating the financials, such as operating expenses and anticipated return on investment. It is vital to gain a thorough comprehension of any potential hazards, such as zoning regulations and the possibility of legal actions. As with all real estate deals, assessing the property location and surrounding area is a key part of the process too. Finally, it is essential to have a thorough understanding of the contract and any other legal documents related to the transaction.  Savvy investors understand they need a team of experienced professionals to assist with this process.  Professional real estate agents, mortgage brokers, inspectors, title companies and experienced real estate attorneys are crucial to developing an effective real estate due diligence checklist and executing on it efficiently as you consider each potential deal.  Gottlieb Law specializes in Arizona real estate law and works with real estate investors of all types to make sure that each potential deal goes through the proper due diligence process.  Contact our firm today at 602-899-8188 to schedule an initial consultation or make an appointment on our contact us page.

Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Gottlieb Law - Forming an Arizona Limited Liability Company for Real Estate Investing
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Forming an Arizona Limited Liability Company for Real Estate Investing
Forming an Arizona Limited Liability Company for Real Estate Investing 2560 1707 Gottlieb Law
Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

A limited liability company (LLC) is a business structure designed to give certain limited liability protections to owners under state law. An LLC is a popular choice for real estate investors because it provides a means of protecting their personal assets from legal liabilities that may arise from the operation of the business. Forming a limited liability company in Arizona for real estate investors offers a range of benefits, including asset protection, tax advantages, and flexible organizational structures. LLCs provide their owners with the same limited liability protection as a corporation, but with the added benefit of pass-through taxation, meaning the business’s profits and losses are passed through to the owners and reported on their personal tax returns. Real estate investors can gain significant tax advantages with an LLC. Additionally, LLCs offer a more flexible organizational structure than corporations, allowing the owners to customize their internal operations and management. Arizona LLCs offer their owners the ability to manage and operate their businesses remotely, which is an obvious benefit for those looking to invest from out of state.  Here are some of the key things to understand if you are considering the formation of a limited liability company for your real estate investments.

Benefits of Forming a Limited Liability Company in Arizona

Forming a limited liability company in Arizona is an attractive option for real estate investors due to its ability to protect their personal assets, provide certain state and federal tax benefits, and offer a flexible organizational structure.  The benefits of forming an LLC in Arizona for real estate investors are numerous. One of the most obvious is the protection of personal assets. LLCs provide a layer of protection for investors by generally limiting their liability exposure to only the assets held by the LLC. This means that investors have the assurance that their personal assets are safe if the LLC faces any legal or financial issues. Another benefit of forming an LLC is the tax benefits they provide. LLCs are able to pass profits and losses through to the individual investors, allowing them to pay taxes on their personal returns at the individual rate. Lastly, LLCs offer flexibility to investors. LLCs are not required to have a fixed number of members, which allows investors to easily add or remove members as needed. Additionally, LLCs can be structured to provide for different levels of management and decision making, which allows investors to customize their LLCs to suit their particular needs. All of these factors make LLCs an attractive option for real estate investors in Arizona.

Arizona’s Laws for Limited Liability Companies 

Forming a limited liability company in Arizona for real estate investors can offer many benefits that can help to protect personal assets and provide certain state and federal tax benefits. The formation requirements for an LLC in Arizona are relatively uncomplicated and can be completed with just a few steps. The combination of these fees helps to ensure that the LLC remains in compliance with Arizona laws and regulations. In addition to the fees, real estate investors should also be aware of the other responsibilities that come with forming an LLC, such as keeping accurate records and filing annual tax returns. By understanding the formation requirements, initial fees, and ongoing fees associated with forming an LLC in Arizona, real estate investors will be able to take advantage of the many benefits that come with this type of business structure.

Considerations for Forming a Limited Liability Company 

As detailed, there are many benefits to forming an LLC for real estate investments.  However, there are some potential disadvantages to consider before deciding to form an LLC in Arizona. The main disadvantage is that LLCs are subject to certain restrictions under Arizona law, including limits on the number of members and the types of business activities that may be conducted. Additionally, LLCs may be subject to additional filing requirements, including the need to register with the Secretary of State, file annual reports, and pay taxes or fees. Therefore, real estate investors should seek professional advice to ensure that forming an LLC in Arizona is right for their investment plans and goals. An experienced real estate attorney can help ensure that the LLC complies with Arizona law and can provide guidance on the various tax and other benefits that come with LLC ownership. Ultimately, forming an LLC can be a great way for real estate investors to protect their personal assets and take advantage of certain state and federal tax benefits, but it is important to weigh the potential advantages and disadvantages before making a decision.

Moving Forward with Forming an LLC for Real Estate Investments in Arizona

Most real estate investors understand that property investments can be lucrative, but they also come with significant costs and risks.  Purchasing residential or commercial real estate with plans to lease the property means there will be risks of issues with the tenants or facility that can create legal exposure for the investor.  Setting up the appropriate legal structure can help shield your personal assets from those risks, create flexibility for operations and make it easier to add strategic partners.  A limited liability company in Arizona will typically be the best structure to take advantage of the benefits and provide protection against personal liabilities in the future.  Additionally, LLCs provide certain state and federal tax benefits, including the ability to file taxes as a pass-through entity, which means LLC members can deduct business expenses from their personal taxes. Furthermore, LLCs can help investors save money due to the LLC’s simplified accounting and reporting requirements. Finally, LLCs provide investors with the flexibility to choose how the business will be managed and structured.

The attorneys at Gottlieb Law routinely represent real estate investors in Arizona and assist with strategic planning, company formation, asset management, and real estate transactions.  Our firm is also prepared to represent your interests if any legal issues arise.  Contact our firm today at 602-899-8188 to schedule a consultation on any Arizona real estate needs or make an appointment on our contact us page.

Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Gottlieb Law - Arizona real estate transactions
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Most Common Things that Can Go Wrong During an Arizona Real Estate Transaction
Most Common Things that Can Go Wrong During an Arizona Real Estate Transaction 1930 1086 Gottlieb Law
Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Many people assume that once the real estate purchase contract is signed the hard part is done.  Buyers and sellers, however, need to understand there are many common things that can happen during the transaction causing the deal to fall apart. When it comes to real estate transactions in Arizona, it is important to be aware of the potential issues that can arise and understand the process from start to finish in order to give yourself the best chance for a smooth and successful transaction. Having a knowledgeable real estate agent and experienced attorney to guide the process can help avoid and resolve common issues as well.  Here are some of the most common things that can go wrong during an Arizona real estate transaction so you can be prepared in 2023.

Inspection Issues Lead to Disputes

The Arizona standard residential resale real estate purchase contract, used generally when real estate agents represent the buyer or seller, includes a 10 day inspection period.  This provides the buyer the opportunity to hire a home inspector and any qualified specialists to review all details of the home before moving forward with the purchase.  It is common for a buyer to find some issues with the home that impact their interest in buying the home and the ultimate price they are willing to pay.  Common small issues will typically be resolved with the seller agreeing to repair the defect before closing or adjust the sale price so the buyer can resolve the matter after closing.  Larger issues, like structural damage, mold or insect infestations, can often lead to a buyer deciding not to move forward with the purchase of the home.  It is generally good practice for anyone involved in a real estate transaction to stay patient and allow the inspection professionals to do their job during this period before assuming the transaction will move forward.  The results of the inspection will need to be considered by both parties and adjustments to the purchase contract and price are a normal part of an Arizona real estate transaction.

Title Issues

Title issues can be a major hurdle when it comes to completing a real estate transaction. Common title issues include unpaid taxes, liens, encumbrances, past due mortgages, or even recorded court judgments (please note the Arizona legislature recently amended Arizona statutory laws impacting the homestead exemption). These issues can create a cloud on title, making it difficult to transfer ownership of the property. Title issues can also make it difficult to secure financing, as lenders may not approve a loan if title issues are present. In some cases, title issues can even make it impossible to complete a transaction. Fortunately, there are solutions available to help resolve title issues. Great title companies have experienced professionals who can help identify title issues and find solutions. Additionally, title insurance can help protect buyers and lenders from potential losses due to title issues. Finally, in some cases, it may be possible to negotiate with the holder of the lien or mortgage to resolve the issue. By taking the time to identify and address title issues, buyers and sellers can resolve many title issues and still complete a successful real estate transaction.  Some situations involving title issues warrant hiring real estate counsel to protect the client’s interests.

Buyer Runs Into Financing Challenges

Financing issues are common and can happen to buyers that have been pre-qualified for the purchase. Pre-approval letters issued by a lender do not mean that the buyer will be fully approved in the underwriting process. These financing issues can have a major impact on a transaction, causing delays, changes in terms, or even the cancellation of the transaction altogether. To avoid financing issues, both parties should have a clear understanding of the other’s financial situation and the terms of the transaction.

Financing issues can also arise if the home appraises for less than the purchase price.  The lender will typically not approve a mortgage in these situations and both parties will have to negotiate a suitable path forward.  Sellers should consider that lower-than-expected appraisals will impact other buyers’ ability to purchase the home as well.  In a hot real estate market, some buyers might be willing to make up the difference in value with additional cash payment at closing.  This is obviously dependent on the buyer’s ability to facilitate that payment and their desire to move forward with the transaction after finding out the appraised value.

If financing issues arise during the transaction, there are solutions available, such as extending the timeline, renegotiating the terms, or finding alternative sources of capital.  The available solutions will often depend on both parties’ willingness to agree on a new timeline so the buyer has time to find new financing.  Flexibility is advised if both parties genuinely want to complete the transaction.   

Closing Issues at the Finish Line

Closing issues can have a significant impact on the successful completion of a real estate transaction. Common closing issues can include an unexpected lien on the property, title defects, a delay in obtaining insurance, or an issue with the buyer’s financing. It is important for all parties involved in a real estate transaction to be aware of potential closing issues and how they can impact the transaction. Depending on the nature of the issue, it is possible that the closing date may need to be pushed back or that the terms of the transaction may need to be adjusted. In the event of a dispute, it may be necessary to involve a third party such as a title company or an attorney to help resolve the issue. Solutions for closing issues will depend on the specific situation, but may include having the buyer or seller provide additional funds, having the buyer or seller withdraw from the transaction, or negotiating a new agreement. It is also essential to determine if any closing issues will affect the buyer’s ability to obtain a loan or insurance and adjust the terms of the transaction accordingly.  

Finally, it is common for the buyer to discover issues post-closing, more commonly known as non-disclosure issues.  Buyers are advised to seek qualified real estate counsel in these situations to get a complete assessment of their legal rights and options.

Expert Real Estate Attorneys Can Guide Transactions to a Successful Closing

Anyone looking to buy or sell real estate should be prepared for common issues to arise during a transaction.  The purchase process is designed to allow both parties time to gather all the information necessary and resolve any potential issues.  Working with licensed real estate agents and experienced real estate attorneys can help avoid common pitfalls and provide both parties with solutions to most common problems.  The attorneys at Gottlieb Law have provided industry-leading representation to Arizona buyers and sellers in the real estate market for more than a decade.  We can help avoid common issues and achieve your real estate goals.  Contact us today at 602-899-8188 or schedule an initial consultation online.

Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

Gottlieb Law - Arizona Real Estate Disclosure Laws
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Understanding Real Estate Disclosure Laws in Arizona When Selling a Home
Understanding Real Estate Disclosure Laws in Arizona When Selling a Home 1769 1184 Gottlieb Law
Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

One of the most important things for anyone looking to sell their home in Arizona to understand is what must be disclosed to potential buyers.  Home sellers will commonly start the process by figuring out exactly what information they have to share with potential buyers and it is natural to have some confusion.  The good news is there are some simple guidelines that will help any seller disclose all the required information.  Here is what you need to know about real estate disclosure laws in Arizona.

Arizona Residential Seller’s Property Disclosure Statement

Anyone that has bought or sold a home in Arizona should be familiar with the Residential Seller’s Property Disclosure Statement, commonly known as SPDS.  The Arizona Association of Realtors created this standard form to simplify the disclosure process for sellers.  If you are working with a Realtor, it is typically one of the first things he or she will go through with you as a part of the listing process.  For those sellers that are looking to sell their home without the representation of a real estate agent, you will want to carefully read through and complete the form by sharing all the information detailed on the form.

Understanding the SPDS and Disclosure Requirements

For starters, all known material information and any defects or issues with the property must be disclosed in the SPDS.  There are six sections to work through that cover the required areas of disclosure for all sellers.  Here are some of the key points for each section:

Property and Ownership

The disclosure statement starts with the key details of the property.  Among other things, this section covers information like the address, year built and ownership status of the property.  You must disclose if the property is owner-occupied, leased, foreclosed or vacant.  For rental properties, the seller must disclose when the current lease expires.  If the property is part of a homeowners association, the seller must include all the pertinent details of the homeowner association fees and when they are due as well as other pertinent information.  The seller must also include any known proposed or existing assessments the potential buyer will need to pay.  Any existing liens or easements on the property must be detailed as well. 

Building and Safety Information

The second section covers any known issues or defects with the roof or structure of the building.  Among other things, sellers are required to disclose known leaks and repairs in the roof.  They must also share any warranties on the roof, including whether those warranties will transfer ownership.  Sellers must also share any known issues with the foundation, walls, ceiling, doors and windows.  

As a seller, it is important to understand that no issues are too small to share.  If you have had any small repairs or issues, simply detail what you know about what happened and what you did to address the matter.  This section also requires sellers to disclose any known wood infestations.  If the property had any issues with termites or wood destroying insects, make sure to disclose the details and what treatments were used to correct the issue.  Sellers should also detail any issues with heating and air conditioning systems, plumbing, and electrical systems.  If the home has a pool, hot tub or water feature, there is a section to detail any known issues or defects.

The section ends with a catch-all miscellaneous section that is particularly important for Arizona sellers.  If your home has ever had scorpions, bees, reptiles or bed bugs, this must be disclosed to the potential buyer.  It also covers any work that might not exactly fit into one of the previous categories.  Make sure to even share things like landscaping work, appliance changes, and other property improvements, even if they seem small.

Utilities

The third section covers all the utility services used on the property.  The seller will need to list the provider for each utility, like electrical, fuel, cable, internet, phone, garbage, water and fire.  Sellers must disclose if there are any known drinking water problems.  They must also include if any alternative power systems, like solar or wind, are being used on the property.  While this section is short, it is still important to be thorough.

Environmental Information

This section requires sellers to disclose any known issues with soil, drainage, erosion, fissures and more.  Sellers must detail whether these problems occurred in the past and were fixed or whether they are still an issue.  Many sellers are surprised this section includes questions about whether the property is subject to issues like airport noise, traffic noise, rail line noise, nearby landfills, and even odors.  There are also questions about any known contaminants, like asbestos, radon gas, lead-based paint and underground storage tanks.  This is another section where it is advisable to disclose anything you can think of that can be considered material to the property.  This allows the buyer to make their decision with pertinent information and eliminates your liability down the road if they try to claim they were not provided correct or complete information.

Sewer and Waste Water Treatment

The fifth section of the SPDS covers the property sewer and waste water system.  Sellers must disclose if the property has had a professional verify the existing sewer connection and what type of sewer is being used, including the name of the provider.  If there are any known issues in the past with the sewer and waste water system, the seller must provide all details of the issue and what repairs were performed to correct the problem.  One of the final parts of this section requires sellers to disclose the last time an inspection was performed on the sewer or waste water system.

Other Conditions and Factors

The final section requires sellers to disclose any additional material information about the property that has not been included in the previous sections.  It can be common for sellers to dismiss this section and assume that previous sections cover all the important matters.  This is another place where the best practice is to share anything and everything that could potentially impact the long term value of the property.

Arizona also requires sellers of homes built before 1978 to include a lead-based paint disclosure notice.  Real estate contracts with Realtors must also include a comprehensive loss underwriting exchange report (CLUE) that details all insurance claims in the past 5 years (or as long as the seller has owned the home).

Arizona Laws on Property Disclosure

The state of Arizona does have some laws in regards to what does not need to be disclosed.  Sellers do not have to disclose if a death has occurred in the home or whether anyone residing in the home has HIV or other diseases.  Sellers are also not responsible for disclosing whether sex offenders live in the neighborhood, even if known to them.

Error on the Side of Caution and Disclose What You Know

It is common for sellers to ask if they really have to disclose certain details they think are small or unimportant.  They will commonly think that it will make it more difficult to sell their home or it will sell for a lower price.  This line of thinking opens the seller up to substantial legal risks.  When it comes to completing your property disclosure form, share absolutely everything that you can, unless Arizona law specifically addresses that you do not have to disclose.  All buyers have an opportunity to hire professional home inspectors and specialists to review everything of interest to them.  This allows them to assess if any additional specialists should be involved during the escrow process and reduces the risk of any future legal claims for non-disclosure.

Work with an Expert Real Estate Attorney in Arizona

The attorneys at Gottlieb Law focus on real estate law.  We work with buyers and sellers to protect their interests in real estate transactions of all types.  Our firm can review potential real estate disclosure forms and contracts.  Our attorneys can also assist in pursuing a claim if material facts were not disclosed during a home sale.  Contact our firm today at 602-899-8188 or schedule an appointment on our contact us page.

Gottlieb Law, PLC provides this article for information purposes only and nothing herein creates an attorney-client relationship. You should not take any actions in reliance on any of the information contained herein without consulting with qualified legal counsel first and reading this article is not a proper substitute for seeking legal advice of your specific situation.  Laws change over time and you should seek counsel to discuss any specific legal questions.

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