Setting the record straight: “SB800, Downtown San Diego Condos in Litigation”

Todd DeBoer, senior sales agent for Downtown Condo Showroom, wrote an interesting post for the firm’s blog. In it, he gives an overview of California’s SB800, or Right to Repair legislation. He then lists a number of multi-family developments that he claims are currently involved in SB800 litigation.

Unfortunately, DeBoer gets some facts wrong. Let’s set the record straight:

  1. SB800 only applies to residential projects built after January 1, 2003.
  2. Several of the projects listed on that site were built prior to January 1, 2003, and therefore are not subject to SB800.
  3. Some of the projects on that list are no longer involved in litigation.
  4. While some defects covered by SB800 have statutes of limitation that last 10 years, there are a number of defects that have much shorter timeframes. For example, “fit and finish” issues are only covered for one year. See this helpful breakdown [PDF] for more info.

One statement that I definitely agree with: “The upside for buyers is that there can be great buying opportunities in these buildings in litigation.” Many people fear purchasing real estate involved in litigation, which can bring the cost down. As DeBoer points out, some lenders refuse to finance property involved in litigation, but as he also notes, there are alternatives.

I am impressed that a real estate sales professional is willing to openly discuss construction defect litigation. Many agents/brokers are afraid to go near the topic, which is a great disservice to their clients. (In some situations agents/brokers are blatantly violating disclosure laws and causing their clients to do the same…)

Worth reading the whole article.