All Forum Posts by: Alvin Sylvain

Preach it brother!

I currently live in the house my parents lived in before they passed. Gadz, I spent most of my childhood here. My wife and I were renting it out for a decade or so, but she decided to move back into it. Don't ask me why :-(

So now we have the option of adding an apartment in the back. Yes, Disneyland, Knott's Berry Farm, LAX, Rams, Beaches, Expensive Shopping, etc., are all too close with traffic nightmares. I'm been against the idea for a long while, nostalgia you know; but I'm starting to soften a bit. I have a friend who lives a couple of miles from here doing that, and is forever having issues with the LA city bureaucrats. We'll see how that works out for him.

You can believe I'll be keeping a close watch on this thread!

I think your tax man has already answered your question. Yes, your "Home Office" is tax deductible exactly the way he said.

Back in the day, I often deducted about one room out of the house, and sometimes part of the garage, depending on what I used it for. With today's weirdness having me locked up at home, I'm certainly going to write off part of the house for part of the year again, as the situation merits. So a 100 ft2 room in a 1000 ft2 house is 1/10 the house value depreciated, and 1/10 of all the utilities, and 100% of everything in there.

I wouldn't worry about what "might" be considered "personal". It's in your "office" right? The space in your house dedicated to your business? It's a business expense. Or do you suppose those Fat Cats driving a Company Mercedes E350 don't take it home to their own garage? Of course they do, and the Company pays for it, and the Company writes it off their taxes, and they have meticulous documentation proving it's used for Company Business.

Sometimes. Lots of times. Right.

Be warned of course, I am not a tax expert. My idea of "Tax Expertise" is knowing how to boot up "TurboTax".

OK, memory hearkens back to yesteryear when my wife and I were investigating a triplex up in Central California. As I recall, they wanted $165K for it, it already had cash-flow at that price with current renters, but it was in serious need of rehab. We ended up passing on the deal.

It was a dump. All three units required serious work. The seller was desperate, ready to carry financing. Ultimately, it ended up selling for $145K. Fixed up, it would probably be worth nearly twice that.

OK, I'm fairly certain I made a big mistake passing on this deal. I don't need anybody to tell me how stupid I was, my own boot-prints are already embedded in my hind-side.

But what I'd like to know from the community is this: what do you do with tenants who, for all intents and purposes, are perfectly happy with the dump being a dump? We would possibly need for them to be out for at least a month, maybe longer, during the process. Ask them to move in with Uncle Harry? Evict them? Or just suck it up for however long it takes for them to move out on their own? Hard to get good Refinancing while it's still a dump.

Guaranteed they couldn't afford a motel for a month, and neither can I, and I find the idea of evicting people just to tear down the place and build it back up again to be distasteful to say the least. Aggravated by the fact that, if somehow we could rehab with the tenants still in place, after the fix-up the market rent would be like 50% more than what they were paying. Oh yah, that'll go over real well. Might as well put on my black top-hat and twirl my mustache.

So it's too late for this deal. What about the next time?

I would say, based on absolutely no objective evidence whatsoever, watch and wait.

I may be wrong, and I often am, but I think the better bargains will be coming down in the next few months.

If memory serves, bargains were available for quite a while after the big 2008 banking crisis. People sell at bargain prices when they're desperate, and they're not going to be desperate right away.

@Dale Miller

Your profile says you're in New York. I don't know if this applies to the entire state, but NY does not have a reputation for cheap real estate.

If you haven't got 25% to invest locally, maybe you have enough to invest out of state. Maybe someplace in the Midwest will fit the bill.

Just research out of state investing. It's a completely different challenge.

@Vincent Gizzi

Consider a market survey. If you have a surprisingly large number of inquiries, maybe your posted rent is too low.

@Eric James Slater

For example: when rented out my parents old house, Mom had all pink walls. Pink doors. Pink fireplace.

Several of our prospects didn't like pink. (Who'da thunk?)

Well, Mom (rest her soul) thought it was "cool" I guess.

After the first tenant (who suffered in quiet dignity coz the price was right), we got wise and painted everything a more neutral color. Not "cool" anymore, but no more complaints from prospects.

@Eric James Slater

I disagree with the general consensus with caveats.

Define "cool". What you think is "cool" may be "weird" to someone else.

Of course you want to follow market trends somewhat, but generally you want the place to be as bland and non-descript as possible. Off-white walls, ordinary fixings, etc.

Just give your tenants permission to customize the unit to their taste (within reason). Let them make it what *they* think is "cool". Let them make it *their* home.

@Maria Crenshaw

I think it's that current photo thing.

I don't know about the rest of you, but I look pretty ugly in my photos.

:-)

@Efrain Diaz

Speaking of stupid marketing gimmicks with an extremely low signal-to-noise ---

How many of you own your own house and get at least a dozen letters every week offering to give you ALL CASH for your property, no matter the condition?

(raises hand)

I even got one offering to buy my Post Office Box. I was almost ready to take that one .....

I can not imagine such a campaign is actually worth the time and money ... but people keep doing it, so what do I know.