Updated over 9 years ago on . Most recent reply
Advice Needed : 1.3 M Property with 0 down & AirBnB potential
Hello,
I have recently came across a deal that I would like to have expert opinion. Here are the details
Owner purchased the property 20 years ago for 200k & then renovated it couple of years ago and spent 400k-450k. Property is in very very good location with almost no vacancy rate. He is currently asking for 1.3M . I ran through some numbers and it isn't a good buy not as personal property neither as investor if you consider Cashflow.
I however offered the owner if he would be in interested in doing a 0% down with lease to own option for 1 year. He is interested, but will respond to me within a day or two. It's a duplex with option to make four plex pretty easily.
Currently it could be rented for 6k all included and I have told the owner that I can pay him same amount with option to purchase it within 1 year.
Now overall, I will be making 6k - 15k, which is very low in terms of overall property cost, but I think it would be a good experiment to get a feel with 0% down.
My major concerns are tax implication. Would i be paying taxes on TOTAL rent or just the profits ?