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How SHB 1843 Affects You?
NWRIA Members and
Friends –
If you plan to buy a property and
sell that same property within a
twelve-month period, then you need
to be aware of SHB 1843.
SHB 1843 was passed into law this
summer with little public input.
There has been a great deal of rumor
and speculation has to how this
new law will impact real estate
investors, realtors, and property
managers.
To the best of our current knowledge
and understanding, this legislation
requires a current contractor’s
license and accompanying insurance
for anyone buying and selling a
property within a twelve-month period
when the property has had $500 or
more of renovation/improvement/repair
made to the property.
In short, if you plan to “flip”
houses in Washington State then
you must be a state licensed and
insured contractor.
Under this law the property owner
must a licensed contractor when
selling a property owned for any
period less than one year. Hiring
a licensed contractor to do the
work will not relieve you of your
legal responsibilities – the
owner must be a licensed contractor.
An entity in title must become
a contractor under SHB 1843, regardless
of how many entities you may use,
not just the entity's principals.
There is no provision, or licensing
capability, for those who hold their
properties in their Self Directed
IRA's name.
Enactment and enforcement of this
law was given to the Department
of Labor and Industries. Exactly
how this law is to be enforced (methodology/penalty)
and the explicit interpretation
of the language of this law are
in process and are yet to be determined.
If you would like to have a personal
say in how this law should or should
not be enforced, then we encourage
you to attend as many L&I meetings
on this issue as you can prior to
the WAC (Washington Administrative
Code) being written for this law.
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