DEAR BOB: We are trying to sell our $3 million, 48-unit apartment complex and have tried to get unbiased information from the state real estate commission, the state board of Realtors and the association of Realtors. We want to know what the typical financial disclosures are for this type of sale. None of the agencies would tell us anything. Every prospective buyer seems to want a rent roll, income and expenses for the last three years, property taxes and more. But we aren’t comfortable complying with these requests. What are the customary disclosures expected of the seller before a purchase offer has even been produced? –Elaina C.

DEAR ELAINA: I’m sure when you acquired the property you asked for the information you specified above. You would have been a fool to make a purchase offer without knowing the basic income and expense information, rent roll, etc.

Purchase Bob Bruss reports online.

After you accept a written purchase offer from a buyer, he or she usually includes a “due diligence” inspection contingency for a complete inspection of the property, including your tax returns for that property.

You went to the wrong sources for real estate sales information. The state real estate commission and the Realtor organization offices are not there to tell individuals how to sell income property.

I suggest you interview at least three successful local real estate agents who specialize in the sale of income property like yours. Stay away from agents who sell only single-family houses because you need a specialist in apartment-building sales. Each agent will evaluate your apartment complex, tell you what financial information is needed, and then suggest a probable sales price for your property.


DEAR BOB: My husband passed away last year. Now I find there is a judgment recorded against my home. Is this legal? –Miriam S.

DEAR MIRIAM: The answer is “it depends.” If you and your late husband held title as joint tenants with right of survivorship, the law in most states is that an uncollected judgment against one joint tenant terminates when that joint tenant dies.

However, if title to your home was held by another method, such as tenants in common, then the recorded judgment lien remains on the house even if it was against just one co-owner. For full details, please consult a local real estate attorney.


DEAR BOB: My 92-year-old mother-in-law owns a house currently valued at about $650,000. It was built in 1947 and she has been the only owner. Suddenly she wishes to gift this property to her three adult children, none of whom have any current interest in it. From reading your articles, this sounds like a bad idea. Where would the stepped-up basis come into play? Only she can claim the $250,000 principal-residence-sale tax exemption. What should we advise her? –Ann W.

DEAR ANN: Don’t do it. That would be my advice to your mother-in-law. If she gifts the property now during her lifetime, the three children will take over her very low basis for the house. I will presume she wants to retain a life estate so she can remain living in the house.

If she gifts the house to the children now and they eventually sell it after she has passed on or moved out, they will have a huge capital gain tax to pay. They would be much better off inheriting the house and claiming the stepped-up basis to market value on the date of mom’s death. She and they should consult a tax adviser to discuss the situation.

The new Robert Bruss special report, “Everything Home Sellers and Their Realty Agents Need to Know About the $250,000 Tax Exemption Rules,” is now available for $5 from Robert Bruss, 251 Park Road, Burlingame, Calif., 94010, or by credit card at 1-800-736-1736 or instant Internet delivery at Questions for this column are welcome at either address.

(For more information on Bob Bruss publications, visit his
Real Estate Center

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