All Forum Posts by: JASON V.

Generally, I think this setup would be to have a Wyoming LLC INSTEAD of a WA, not both. Then you would register the Wyoming LLC as a "foreign llc" doing business in WA. This is usually done under the assumption that laws are more favorable where the LLC is formed, then the persons home state. (Wyoming and Nevada, are popular for this)

This still doesn't solve your "privacy issue" though, that would generally be done by holding title in a real estate privacy trust. Then if someone looks up the owner of the property it shows up as the trustee(which in this case should not be you).

I am, but I'm a smaller investor and only do one or two a year anyway.

I had a property on Fort Myers Beach that I sold after the hurricane. In order to get power ran back to our house, we had to get a structural report/sign off from an engineer. So depending what you're looking at, most things that have power restored should of already passed a structural inspection.

Pay attention to mold and electrical as well. Most of the houses that were sitting on grade were  completely or almost completely under water. (my house was underwater completely except for the crest of the roof) ALso, the city wasn't letting anyone back on the island (even owners) for like 14ish days (I forget the exact number), so ALL of the non-raised houses were full of mold by time anyone was allowed to go in and start doing things. 

Hopefully you're aware of these types of issues, or as Nick Bednarczyk stated above you get a good inspector who will be on the look out for them.

 I would say about double the number that is using for insurance.

I would agree with Adam. I would also add that if you're planning to pay cash ( and actually leave the cash in the house), if it was me I would 100% skip flood insurance in that area. There's very low chance of a flood there. Even with hurricane Ian (biggest in history for the area) nothing over there would of flooded. Plus as a "almost new build", that house is already raised to standards. (which you can see good from the street view pic with all the fill they had to bring in to get it to height)

With that said, I would say it's a fairly average deal. You may also want to look at some actual new builds. A lot of the larger builders are negotiating and offering interest rate buy downs on spec homes they are sitting on.

Just wanted to point out, if you're taking a loss or even close to break even on the sales no need to worry about bothering with a 1031 as there wouldn't be any taxes to defer anyway. (then you also don't need to worry about the time crunch of a 1031

I would suggest just selling and sitting on the money until a truly attractive offer comes your way. As others have mentioned, things are a little rough in FL right now, and you need to do very careful underwriting. Rents are trending down, and prices are starting to as well(inventory is way up, time to sell has doubled, and a lot are seeing as least one price drop before they sell).

Sorry to hear they aren't working out for you. 

Who's the builder, and how long has it taken them? 

The builder pulls the permits, etc. Wouldn't you need them to get final inspections and permits closed anyway?

Wow, three years under construction and it's still not done? I've heard of things taking up to a year down here, but 3 is pretty crazy. That must be frustrating.

How about price, is it still the 2020 price, or were there a lot of change orders and price increases as well?

I'm just wondering are there any benefits to holding an inactive RE license? (I've seen other people doing it as well, just curious what you get out of it)

Are you asking if people think it makes sense to sell your house at a loss (that is currently producing income, albeit minimal) in favor of hopefully replacing it with a higher monthly income producing asset?

This doesn't make sense to me, as you would be losing money on the deal. What would you be gaining to use on a different deal? Assuming you have a portfolio of other rentals (which you hint at in some replies) wouldn't it be a better idea to pull a little money out of one of those instead of forcing a sale on this one to fund your next purchase? At best you're looking to pull out maybe 60-70k(2/3ish of your original down payment?), while reducing your monthly income by ~200 it seems from your numbers.

This leaves little capital to re-invest in a higher income producing asset. If you'd reinvest that in a turnkey property, you'd be looking at downgrading to a 300kish property with a much higher interest rate. Keeping in mind the first 200 of profit disappears just to break even with where you used to be for monthly income. After that keep in mind the slower appreciation of a 300k asset vs. a 550k one.(3% of 300 is much less then 3% of 550k obviously)

With all that in mind, from a financial standpoint I would suggest against selling for a loss. I would suggest looking for ways to increase your cash flow(like switching lawn/pool care to tenant responsibility and/or raising rents, trying STR or MTR).

Unless your real question was meant to be, "The southwest FL market (or the RE market in general?)scares me, would it be worth taking a 30% loss of my original capital to ease my mind". Then my answer might be completely different. Which would include advising to possibly reinvest into a CD, or other "less risky" investment. (which at 60k cash, could possibly net you 250 a month just for a bank CD @ 5%)