All Forum Posts by: Greg Clatterbuck

@Bill Brandt 

Purchase price was $135k with current rent of $1400, could likely get $1500 after upgrading.  

The taxes would be assessed on approximately $100k because of the 10 years of depreciation and current appreciation.

With a 1031, the equity would be used to purchase a $450k property which would cover 100% of the equity  

Looking for critical feedback.

I currently own a property (10 years) that is valued at $215k, mortgage of $100k currently cash flowing approx. $600/month (not including cap ex, vacancy, maintenance).  I self manage the property as it is near where I live and takes minimal effort.   The tenant would like to purchase the property.  If I keep the property, it will need approximately $5-7k in repairs (carpet, paint, etc) and an HVAC (13 years old) at a cost of $5k.  

I am currently making an offer on a pair of duplexes out of state that I could 1031 into, however, already cash available to complete that purchase without selling current property.  If I sell and 1031, I will use the cash on hand to purchase another property.

If I keep the property, I can do a cash out refinance for approx $50-60k, although the current interest rate is 3.75%.  

My long term goal/investment strategy is buy and hold.  I have never sold a property previously.  

Thoughts/Recommendations ??

Thanks

Great idea

As a licensed home inspector, I have found that general contractors only repair what they have been asked to repair.  I have seen many "flips" where paint, carpet, kitchens, and bathrooms are updated, but not the structure, electrical, plumbing, and other systems of the home.  If you are looking to turn this into a rental, spend the extra money upfront and save the headache down the road.  If this will be a resale, be prepared for a home inspection to reveal the areas of the home that have not been updated.  Make sure the contractor is licensed and pulls the appropriate permits for the work performed.  This will prevent headaches down the road.  

Good suggestion Tom.  Thanks

Thank you for the responses!

I am in the process of writing an offer on my first multi-family (8unit, 12 bedroom) purchase.  I have purchased multiple single family homes for investment and have a home inspection business (very familiar with single purchases).  What suggestions do you have for contingencies on a multi-family offer aside from financing, property inspection, verifying paperwork (leases, actual expenses, work performed)?  Thank you