In Houston I wanna buy an investement home but builder contract say I can only buy as Primary or second. WHY?

Question

I want to buy this NEW house from DR HORTON at full price but they say that I can only buy as Primary home or secondary home.

If I buy as secondary home but rent it out, will the builder take any action. DO THEY IMPLEMENT THESE CLAUSES? My agent says that they don't come back and check.

What is your experience?

Answer 1

This is a small technical thing;
read the deed. IF the verbal restriction is in the deed, he can limit you. It sounds absurd.

However, sometimes, a condo complex, for example, winds up
primarily being owned by out of state
owners and the occupany thus becomes problematical, especially for police.

HOUSES outside of your area, are
also not good long term investments.

IF you want investment advice, I can
offer it to you.

lastly
if a seller verbalizes a restrction to
a propery's use, it has no meaning.

EVERYTHING in real estate, to be
enforeced in court, must be in writing.

cheers

Answer 2

I think the builder wants his development to be owner-occupied, to protect his own investment's value.

If the clauses are properly written, they are enforceable. The remedy depends on state law, they may be able to repurchase from you for your original sale price, or possibly evict your tenant, leaving you with a lawsuit by that tenant.

There's other property. I'd probably let this one go by rather than risk a lawsuit because you want to do something the current owner doesn't want done.

Answer 3

alot of developers do that to protect themselves ,and also if the investment % is too high in the development Lenders will shy away from lending on that property. If you buy it as a second home and decide to turn it into a rental the only problem you might have is a neighbor calling the HOA or the HOA finding out(if there is a HOA) if not they would actually have to come to your house and interview the tennent which I have not heard of .