Thanks for the input, Tim. I did check out all the things you mentioned before I made an offer. There is water, electricity, phone, and it is zoned for one residence. There is no time limit to start building. The volcano flows to the east, and this area is in the south. Incidentally, if anyone buys property in Hawaii, they have a law governing some property called “lease-hold”. This is where you buy the property, but you have to give it back after 30 years or so, under an agreement between native Hawaiians and the US gov’t. If you want to avoid this, you need to make sure the property is “fee simple” (which this lot is). It is in a residential subdivision with other lots that have homes already. I know the area.
This purchase probably qualifies as my first RE investment. I have gotten a lot of help from this website in terms of how to do due diligence, but I will probably learn from “doing” as well. I know I’ll make mistakes, but if I never take action, I’ll definitely fail. Thanks again.
On the website, it was advertised as 1 acre (appx 42000 sq ft). I put in a bid and eventually won. On the website is an area for due diligence, but it said there was no due diligence required. Now, I know I should have checked it out further with the state of Hawaii, etc. But I didn’t.
Today, I received my deed package, where I sign the forms and send to Hawaii for recording. It stated that the lot was actually 8100 sq ft, hardly an acre.
Do I have any recourse at all? I have already purchased the lot, but I believe the size was misrepresented. It’s still a bargain at the price I paid, and I still want to keep it (my wife and I want to retire in Hawaii someday), but I think I just got burned. I sent an email to governmentauction.com telling them my concern, and I should hear from them by Monday.
Has anyone had a situation like this before? What would you recommend I do? Should I hire an attorney? I live in Phoenix, AZ (d’backs fan), does anyone know a good RE attorney here?
I appreciate your input. If anything, this stresses the need for due diligence.
Posted by Kristine-CA on November 11, 2001 at 09:34:41:
Hello. I’ve used Bid4assets. They are a legit online auction contractor, and some of their clients are the feds (U.S. Marshalls property) and other municipal agencies.
While due diligence was/is your responsibility, I am wondering where this information about your lot came from. Did the seller submit incorrect information, or did Bid4Assets.com make a mistake? If your seller was a county or federal agency, you may not have any recourse as their sales are usually as-is, with no guarantee or warantee whatsoever as to validity of description or information about the parcel. But if the information used to sell the property was intentionally false, I would think there is some kind of recourse. It appears that your due diligence work is being replaced with another kind of diligence.
Posted by Brent_IL on November 11, 2001 at 01:42:07:
When my wife was in grad school she bought some land in Arizona. $4,000 paid over time for one-half acre. They sent her photos of a new club house. She doubled her investment. About 18-20 years later, I was curious as to why the taxes had never gone up.
After some cajoling, the tax assessor?s office told me that there were two places in the entire state which would never be built-up. Her land was in one of the areas. There is no water, and no hope of any water. The terrain is such that it is too difficult to even truck it in temporarily. I was told that the only time it would matter if I paid taxes was when I sold. Otherwise, to limit expenses, the county didn?t bother to foreclose on worthless land.
I am not sure what kind of auction site it is, but if you paid with a credit card, maybe you have recourse this way. However you say you want to keep it anyway, even without the due dilligence.
Did you notice if the 8,100 sqft was all up hill and unbuildable? Was it on top of a volcano? Do you know the zoning restrictions on the land? IE: Can you even build on it and is there a way to get power and water to the property?
Yep, due dilligence would have been prudent; even after you purchased it. You still want to know. While you may want to retire there some day, your plans may change and you might sell the property. What will the taxes be each year and is it worth paying the taxes?
Time for some research to determine exactly what and where you bought. I know you said it was a good deal, but just because you get land cheap, may not mean it is a good deal. I was once offered a piece of property that was basically a gully. Could not be built upon and the guy just wanted to sell it for the taxes due on it. I looked at it, checked zoning codes for any useful purpose, and said no.