There aren’t many investment opportunities more complicated than commercial real estate, from a legal perspective. There are three tiers of laws that one must be aware: federal laws, state laws, and local laws. Not only do real estate laws encompass a broad spectrum, but also, understanding property laws to insurance laws. When you are not sure what to do in any given real estate situation, the best way to protect yourself is to hire a commercial real estate lawyer to guide you through the murky legal waters, especially if there is a large investment at stake. Even with professional help, it is key that an investor knows the following five laws before taking the next step toward investment.
1. Tenant/Landlord Laws
Landlord/tenant laws differ depending on where you live, but generally are designed to keep both parties protected. Clauses often will govern taxation, rental fees, duration, rights to termination, and more. These laws create legal expectations between the tenant and the landlord and provide the guidelines for the agreements.
2. Disclosure Laws
These laws also vary depending on the state you live in and deal with location, condition, and the restrictions on properties. Usually, disclosure laws are in place so that those renting properties comprehend exactly what they are signing up for. In many situations, owners are required to disclose any known or unknown presence of toxic substances like lead paint and asbestos. But other less-obvious disclosures must also be required depending on your state.
3. Land Use and Zoning Laws
Generally, state or local legislators dictate how zoning and land use regulations are enforced. These laws determine how a property can be utilized. When you understand the regulations in your area, you can protect yourself from zoning violations.
4. Contract Laws
Rental agreements are contracts that are legally binding by one party or the other, and are accepted by both parties. These documents must be specifically designed to contain rigid verbiage to stand up to any challenge that may arise.
5. Insurance Laws
As a property owner you will want your new investment covered by insurance. Having insurance in place will cover your property and the tenant’s property should an accident take place.
As these topics are reviewed and considered related to investing in commercial real estate, consider a professional to assist. Also, if you are an individual or an organization in need of a commercial real estate lawyer, contact Warren S. Dank, Esq. Call us today to schedule a free consultation.