All Forum Posts by: David Pham

Hello,

I'm hoping a CPA/Accountant might be able to point me to the right direction on this issue related to journal entries. I'm stuck with how to classified the renovation that I did for the property in my book. 

Here are some background information.

For example, let's say I purchased a property for $100,000 and put in $50,000 to renovate the property. The bank is loaning me 80% of the purchase price AND the renovation cost ($150,000 x 80% = $120,000). After the renovation, the property is now worth $200,000. How do I make the journal entries for this? The following is what I have so far...

Debit Cash: $20,000 (i received a net $20,000 from the bank)

Debit Building: $150,000

Credit Long-term liabilities - Mortgage: $120,000

BUT, The debits and credit doesn't add up (...which is a cardinal sin according to the accounting god :-) ). 

Please let me know what I am missing? Thanks!

David

@Liz Heisler "No deal is better than a bad deal" :-)

Hi @Megan Greathouse I will be there on Thursday. Looking forward to catch up and meet new investors in the area.

David

Hi @Liz Heisler, I  recommend checking craigslist and Zillow for current listings. It will gives you a good sense of the current rate for the area. Rentometer is another resource but it is free only for the first three searches.

Re the "den" aka unofficial bedroom: this is one of the challenge with properties in the South City area. Many owners/sellers will advertise this as an extra bedroom, because many people do use it as a second bedroom :-).

What is the layout of your property? is it a shotgun style with separate dining area? if so, I've seen some investors turning the dining area into a 2nd bedroom. This will increase your initial capex to turn it into a 2nd BR but might get you the $750/mo that you're looking for :-).

I hope this helps!

@Michelle Eisenberg Sorry to hear about your experience. I agree with @Max Householder to have a meeting/call with them and find out why they have not had any showing. Also, as @David Ounanian mentioned, pre-screening is an important part of the qualifications process. The key is to set expectations ahead of time and make sure they follow through with it. I've been interviewing property management companies in the area and have narrowed down to 3 companies I will work with in the future. PM me if you want to talk to them. Also, PM me the company you're working with so I can avoid them :-)

David

Hi BP, I'm looking contractors recommendation to do flooring, drywall, and painting work for one of my property in St. Louis, Missouri. If anyone know of a good contractor, please PM me. Thank you in advance!

David

Congratulations Anthony! That is an impressive record for your year one. Just have to double it every year now :-)

@Zack P. I'll PM you a couple that I know in the area. Have a great day!

David

Congrats on taking the first step @Willie Cunningham. I'm doing the same thing to analyze properties in St. Louis. You'd be surprise how much you'll learn by doing that. Keep it up!