Welcome to San Diego Blog | April 24, 2012
Buildings In Litigation
Downtown San Diego
Part of the typical lifecycle of a condominium complex, is the process of litigation. In California, developers are responsible for construction defects on a community or building in which they built for the first 10 years. It is common that the homeowners and thier association board will vote to file a lawsuit to settle any disputes for construction defects prior to the expiration of the 10 year period.
Such is the case for many Downtown San Diego Condo Buildings today for the very reason that many of the complexes were built in 2004 or later. Currently, there are 17 different complexes that are under litigation, which equates to a fair number of condos that are currently for sale in Downtown San Diego. To date, there are 154 Downtown San Diego Condos For Sale within the CCDC boandaries, which excludes Banker’s Hill. Among Downtown San Diego’s deplated inventory of condos for sale, approximately 16% of them are in buildings that are currently under litigation.
Buying In A Building Under Litigation
Buyers who are considering purchasing in a building in litigation have fewer financing options than other buildings. Because there is more risk to lend on a property under litigation, lenders who actually offer financing for these properties, require a buyer to put more money down. Generally speaking, a buyer’s minimum down payment in a building with litigation would be 25% down.
We are finding that there are very few lenders can even get a deal done during this litigation settlement process. The Welcome To San Diego Real Estate Team has had quite a bit of success in getting their clients into properties in litigation, and finding a lender that can get the deal done for them.
Obtaining financing in buildings in litigation can be tricky.
On a personal note: I recently had a great experience with Lisa Coleman at iMortgage, who was able to successfully obtain financing for my client who was engaged in a purchase on a property under litigation at Aperture.
This was an incredible penthouse property that required a a jumbo conforming loan with a purchase price of $700,000. The challenge was that the property was an approved short sale that required a buyer to have the ability to close escrow within a short timeline. IMortgage worked efficiently was able able to get it done within 30 days!
If you are a buyer considering purchasing in a building under litigation, you may have an advantage in obtaining a great deal on a property, simply because there are fewer buyers in position to put down 25% or more on a property.
If you fit this profile, it may be a optimal time to consider seeking out a property at one of the following buildings:
San Diego Condo Litigation Guide- 2012
|350 West Ash||350 West Ash St.|
|7 On Kettner||702-714 Kettner Blvd|
|Aqua Vista||425 West Beech|
|Aperture||1494 Union St|
|Cortez Blu||801 Ash St|
|Crown Bay||350 K Street|
|Diamond Terrace||427 9th Ave|
|La Vita||300 West Beech & 1580 Union St|
|The Lofts at 777 6th Ave||777 6th Ave|
|Nexus||875 G Street|
|Park Place||700 Harbor Dr, TH:
715-781 G St/ 680 & 686 Kettner
|Porto Siena||1601 India St|
|The Grande North||1205 PCH|
|The Mills||1643 6th & 1642 7th|
|Union Square||1480 & 1400 Broadway & 1465 C St|
As mentioned, there are currently 17 condominium communities that are at various stages of some sort of litigation settlement. Of course this list will change, so make sure to check back with us if you are considering purchasing a property in a Downtown San Diego Condo Building.
If you have questions or interest in purchasing a property in litigation in Downtown San Diego, give us a call! (858) 531-8785