New Ruling on Short-Term Rentals

BY: TRAVIS HUEHLEFELD, ATTORNEY, WILSON CRIBBS+GOREN

The Supreme Court of Texas recently issued an opinion that has a major impact on short-term rentals in Texas and the interpretation of deed restrictions.

In Tarr v. Timberwood Park Owners Association, Inc., the Supreme Court of Texas held that phrases in deed restrictions such as “used solely for residential purposes” are not broad enough to prohibit short-term rentals. The case resolved a split among Texas courts relating to the interpretation of deed restrictions containing such language. Prior to Tarr, lower courts reached opposite results despite being faced with similar language.

Tarr concerned language in deed restrictions affecting San Antonio’s Timberwood Park subdivision. The language is very similar to language found in many residential deed restrictions. The restrictions stated that:

  • All tracts shall be used solely for residential purposes, except tracts designated … for business purposes, provided, however, no business shall be conducted on any of these tracts
    which is noxious or harmful by reason of odor, dust, smoke, gas, fumes, noise or vibration ….

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Dealing with Deed Restrictions

BY: Omar Izfar, Attorney, WILSON CRIBBS+GOREN

 

 

 

 

 

Private covenants and restrictions, often simply called “deed restrictions,” run with the land, bind future owners, and usually affect what you can do with your property. Deed restrictions for residential neighborhoods contain a variety of rules that impact development, such as land use controls, setback, lot size, and frontage rules.

I often see extremely old deed restrictions that don’t adequately address the needs of the current property owners, yet they are still in effect and enforceable. As cities continue to urbanize and developers find infill opportunities, outdated restrictions clash with modern development goals. Modifying these deed restrictions can be challenging and often requires professional assistance.

Restrictions on commercial property, unlike restrictions for residential neighborhoods, are typicallymore recently drafted and often easier to amend, but may still contain land use restrictions and other provisions that interfere with new development plans.

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Floodplain Ordinance Revisions

BY: OMAR IZFAR, ATTORNEY WILSON CRIBBS+GOREN
& JAMES JONES, PE, JONES | CARTER

Houston City Council voted just last month to approve revisions to its controversial Floodplain Ordinance. Here are some of the highlights of what the revised Ordinance does:

Regulated Area

Previously, Houston’s code applied to new permits and plats in the 100-year floodplain. The new revisions extend this to the 500-year floodplain. Land in the 100-year floodplain has a 1% chance of flooding in a single year while the 500-year floodplain has a 0.2% chance of flooding. As you know, we managed to experience a series of events that met or exceeded the 100-year rainfall intensities in the past few years. The City intends to regulate new construction to the 500-year floodplain

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2018 Texas Property Tax Deadline Change

BY PAUL BETTENCOURT

Protesting your property taxes every year offers a great opportunity to save money. In Texas, property taxes represent approximately 40% of total business taxes. This is a large component
of expenses that can be challenged and changed.

Protesting your property taxes every year offers a great opportunity to save money. In Texas, property taxes represent approximately 40% of total business taxes. This is a large component of
expenses that can be challenged and changed.

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Vested Rights: Fair Play by the Government

How do concepts of fair play apply to Land Use Regulation?

By: Reid C. Wilson
Wilson Cribbs + Goren

When engaged in a real estate deal, most would agree that parties should both stand behind their representations and not change any rules of engagement, or be subject to legal challenge. But what if the other party is a government? Is the government subject to the same rules of fair play? The answer is no, but the state legislature has added a significant protection for land owners/developers through vested rights.

In the private context, there can be both written and oral agreements. In Texas, a clearly drafted written agreement between private parties is, except in a few exceptions, enforceable in accordance with its terms. Oral agreements are problematic, but a well-established body of case law provides for enforcement of certain oral agreements. Where a representation is made by one party to another party in the context of a business relationship, and the receiving party reasonably relies upon that representation to their detriment, the legal concept of estoppel bars the party making the representation from reneging on it, notwithstanding the lack of a written contract. The theory is that it is equitable to enforce these type of non-written business understandings. Therefore, a private party could be bound to what it represented to another party as the rule of engagement for a deal.

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Tackling Tax Reform: How Changes to the Law Impact CRE

BY BRANDI SMITH

Just before Christmas, Congress offered up to President Trump what is arguably the best gift lawmakers could have presented: a major legislative victory in the form of the Tax Cuts and Jobs Act. The sweeping reform of the U.S. federal tax system will mean significant changes for individuals and businesses, including those in commercial real estate.

Some particulars of the bill are being worked out at the IRS and are expected to be clarified this month. Ahead of that, Marcus & Millichap,a national CRE brokerage firm, broke down how
investors will be impacted by the changes with a forum of experts.

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