Minor in Possession (of real estate) (LA 910)

Transcript:

Steven Butala:                   Steve and Jill here.

Jill DeWit:                            Hello.

Steven Butala:                   Welcome to the Land Academy Show, entertaining land investment talk. I'm Steven Jack Butala.

Jill DeWit:                            And I'm Jill DeWit broadcasting from sunny Southern California.

Steven Butala:                   Today, Jill and I talk about minor in possession of real estate. This is obviously a play on words for minor in possession. Like the show yesterday, it was inspired by an actual thing.

Jill DeWit:                            Exactly.

Steven Butala:                   An actual comment.

Jill DeWit:                            I love it.

Steven Butala:                   The real question is this, can a minor own real estate? The real short is answer is yes, and we'll talk about it because it gets tricky. Before we get into it, let's take a question posted by one of our members on the LandInvestors.com online community. It's free.

Jill DeWit:                            Matt asks, "I have the opportunity to buy four half acre lots, two on one side of the street and two on the other side. Everything looked good at first with asphalt roads, curb and gutter, all the utilities and an agreed purchase price less than half the value of comps in the area. The agreed purchase price is $20,000.00 per lot, and the lowest priced comp is $50,000.00. But once I looked on Google Earth, I discovered that the road had been raised to meet a grade of perpendicular road it T's into-"

Steven Butala:                   Great due diligence.

Jill DeWit:                            "As a result, the road for these four lots' front is about 10 to 15 feet-"

Steven Butala:                   Oh, feet?

Jill DeWit:                            "Higher than the lots, with about a one to one slope." So the road's up-

Steven Butala:                   Not inches?

Jill DeWit:                            The lots are down 10 or 15 feet-

Steven Butala:                   I hope that's a-

Jill DeWit:                            And then a one to one slope down from the road.

Steven Butala:                   I hope that's a misprint.

Jill DeWit:                            Right?

Steven Butala:                   I hope it's 10-15 inches.

Jill DeWit:                            "Do you have any-" it does say feet, I don't know, "Do any of you with building experience think that these lots still have value close to the comparable lots that don't have any of this type of topography? If these lots are devalued due to the situation, do you have any idea how much they would be devalued, or are they not worth hardly anything because of the cost to raise the grade of these lots? Any insight would be greatly appreciated. Thanks in advance."

Steven Butala:                   I mean, my hat's off to you for figuring this out very quickly on the Internet without spending any money. I mean, I can tell ... I don't know if you're new at this or what, but you're going to be good at it. First, you had what it takes to find the lots in the first place, and they're undervalued so you got 85% of the way there. You asked all the right questions, are they devalued? What should I do? What do I do next? I don't have any experience.

All these questions are great. We're not the people to ask them. I can tell you what Jill would do, she would call a local real estate agent. She would call the owner of a tire changing shop that's close by ... I've seen her do all of these actual things. She would call the clerk at a-

Jill DeWit:                            I'd talk to the county.

Steven Butala:                   7-Eleven that's close to the place.

Jill DeWit:                            I'd call the county too, and talk to them about it.

Steven Butala:                   Called multiple people at the county, and just say, "What the heck is the deal with the grade on thes...