All Forum Posts by: Gail W.

I don't know if this is a request for some creative ideas or a cautionary tale...

We just closed on an investment rental property in a rural area above Phoenix. The seller asked to rent back for a month, to close on her next place. We agreed, but told our realtor to add in OUR lease with a security deposit; just as we do with any regular renter. She sent it to the listing agent, who got the seller to sign, but then the seller became angry and tracked us down and called us on an old phone number, SCREAMING that it was "her house for the entire month" and she shouldn't have to sign anything, much less PAY a security deposit. Flat out REFUSED. This was days before closing, so we didn't have time to change anything.

We come to find out, within minutes of funding, the lease was "blurry" in the Docusign her relator used, so NONE of our custom entries or her signature are legible!! (We missed that at signing; we were preoccupied with a 6 plex we are closing on that has all the regular issues buying a 6 plex has. No excuse, but this sale had been going very smoothly, and we had no reason to doubt or worry.)  So we sent a regular lease via email/mail/hand delivered. You guessed it, no response. ALSO, come to find out, this woman is clinical bipolar; the realtor tells us AFTER all is said and done. Which would be fine, if she would take her meds and conduct herself in a responsible way. She sends us texts and phone messages where she just rants on and on about her poor life. 

Now, we have no lease, no security deposit and just the escrow instructions spelling out the rent back for 1 month (terminating on Feb 28). And now we see she has posted on social media that she wants to list the home on AirBnB!! Of course, we have a no sublease clause, but SHE WON'T SIGN THE LEASE. Realistically, not sure she'll be able to rent it out with only 2 weeks to go... IF she is REALLY moving on the 28th...? She's also got a Zillow ad where she tried to sell the house herself (for over $100k normal prices and what her agent listed it for/we bought it for). She will not relinquish ownership so we can create our rental listing. We have told her we won't show it while she is there. 

All of this is a bunch of red flags... we're worried she lost out on her next place and is planning on staying longer, without the lease or security deposit. Or she intends some other shady business.  Our only recourse is eviction if she won't move on the 28th. Our attorney has stated the only thing he can think of is do a 2 day notice of inspection. If she refuses, we can proceed with eviction process. But I hate to open that can of worms if she really plans on moving, so we'll wait and see. 

Thanks all... the reason I asked on here was 2 fold; my CPA was out on vacation for the long weekend, (but DID get back to me. She's the best!) AND I see freshies asking similar questions on other platforms and figured it would be a good one for someone to find in a search. ;) 

What she said, essentially- NO, moving it into the LLC won't matter (for tax purposes). YES, wait til we are perm residents of AZ as their taxes will be so much lower than if we are residents of CA. And that was something we really care about... that keeps over $15k in OUR pocket.

We already have a great "rent to own" contract we've used before, prepped by our atty. We got a nonrefundable down of $50k and balloon due mid January (the buyer also likes January as he wants to sell some options and needs to have it be in 2022 due to HIS taxes). We will put it in the LLC for the short life of the Rent to Own simply for protection (we will still have 100% control and will continue to rent it out/pay all costs).

We don't NEED to sell this property, so if he walks, we have $50k for doing nothing, so it's all good!

To answer a few other items I saw in some responses:
*The mention of a 1031 has been searing my brain all night! A park model is considered personal property until it is tied into a land parcel. Mine is on state owned land, run by a sub-concessioner.  1031s are exchanges for LIKE, so if I did a 1031, I could exchange it for another park model/mobile home (or 2)??? I always thought it had to be real property, not personal property, but after spending the morning researching this, I MAY BE ABLE TO DO THAT!! I will ask my CPA and atty again, once the long weekend is done. THANKS Doug McVinua for mentioning it! ;) (And yes, we ADORE Arizona!!)  
*We don't OWN anything (any more) in CA. Sold all our holdings in 2019 and reinvested in AZ, buying 3 other rentals in various towns. We are here in CA temporarily on a job in a corp rental, but according to CA, not temp enough, (so hand over the tax, chumps). Retiring from this W2 career after 25 looooong years mid Dec. YAY!

Need some help figuring this out...  

The Mr earns @ $100k on his W2 job. He will retire from that this mid December. We live in California, but will move permanently to AZ in December.

We own 3 rental properties in AZ; one being a park model that is a STR that we have had for 14 months.

We created an AZ LLC. We were about to put the Park Model in to the LLC.

Current vacation renters just offered to buy the Park Model for $350k. We purchased the Park Model for $162k, and can claim around $30k cap exp for rehab, so tax basis of about $192k. 

Should we hurry up and put the park model into the LLC before the sale? If we are still living in CA, but the LLC is in AZ, will it help/matter?

OR- we can WAIT and sell it to them in January, AFTER we've officially moved to AZ. They are fine waiting, but I feel like a bird in the hand is apt to fly away when it sees something better... ;)

TIA!

Just spoke with my loan officer who said my current escrow has stalled in underwriting; no one is at the different places they need to contact for verifications. And the new loan we were about to start for another income prop? Nope. The seller is willing to wait, but we're thinking maybe not. We're small potatoes and would rather save our cash and ride this out. 

I have 2 rentals; one in a low income town and one in a well off retiree type town. Told my one renter that Amazon was hiring for delivery drivers. He applied and was immediately hired; going thru training already. So I told them we can work with that. 

My one in the retiree town is still being readied for rent with an anticipated move in by the 1st. There are NO rentals in that town. I checked in with my prospective renter and back ups and they ALL still want it. WHEW!

By the way; this was exactly why we sold our rental in So Cal. They keep coming up with these great ideas that made us too nervous!

I am looking at doing a minor rehab on a rental we just purchased out of state, in a small community. The local hardware stores are already running lean, what with China imports down. Last I heard, there was no drywall at the local HD. I can work around the little stuff, so it won't affect us too much. And our renters are well off retirees. 

There are great deals to be had during times like these, and people still gotta live somewhere. But for right now, we are not looking at properties that need a ton of rehab,  in communities where the renters are going to be struggling with paycheck to paycheck issues.  That's just our comfort level as very small, starting out noobs.

I am in the process of research Anderson, as my husband has been watching their YT vids and is ready to sign up. One thing I keep seeing is reviews from employees (Glassdoor, Indeed, etc) stating how overworked and under-educated they are. They state it's great to get an entry-level job and learn as you go, then head somewhere else.

A lot of employee reviews mention the confusion and chaos and high turn over made them leave. One stated he had no clue how to do taxes, but was thrown into it immediately. The bad reviews from people who have purchased their packaged services state how many times they were given a new bookkeeper would seem to support these claims. And the job openings for entry level tax prep work with them says right there they'll train you (must be willing to work towards obtaining EA or CPA status...).

Not sure that I want someone with less experience than myself doing my taxes! I mean, if he's going to make the same mistakes as ME, why would I pay so much for that?? I feel like there are SO many employees, stuff is bound to get lost in the shuffle. Heck, I lose my glasses on my desk and it's just me and The Mr.!   

I get it- there are disgruntled employees in every big company, but it does make you think. 

(We don't even own a primary home at this moment- only a vacation rental park model trailer in a Resort, and are in escrow on a SFR investment rental for $150k. Not sure we even need all that...YET. But The Mr is aiming high, so... ;)

LOVE Havasu! We've had a couple of vacay rentals out on the Island that have done really well for us over the years. We recently sold one so we could get right ON the lake and MAN, that thing is a hot rental! 

Next, we are looking for a regular SFR out in town to rent full time to working families. That's something Havasu really needs more of. There isn't a ton of high paying jobs; it's a resort town. But we desperately need families to keep coming to run those tourist businesses and we need them to STAY and become vested in their home town. So good, clean, solid, decently priced rentals are a must.

Problem is; every other refugeeing Californian has sold their high priced home back in So Cal and come out and purchased all the cheap homes, flipping them. So prices have shot up. Personally, I can't see how the higher and higher sell and rental prices can  continue when the ones needing to pay for them are not making So Cal bank. So it's hard to find an SFR under $200k anymore. This time last year- I passed up half a dozen SFRs in Havasu around $130k- $150k because we were tied up with our So Cal home and vacay rentals...DANG IT!! 

We are scouring the town looking for that next gem, but I refuse to overpay when they'll top out soon and then I won't make anything each month on rent. :/ 

We were just discussing this! I am looking at properties in another state that's less...tach savvy, lets say... all the pics are so terrible! Super closeups of the wall above the toilet, very dark and grainy photos of long hallways, or, our fav, a pic of a pic on a computer screen!  I thought these were from FSBOs, but was shocked they are from Realtors!!

Any app creators out there? Here's a need. 

Thank you, @Maxine Kunimura for posting this question. It was my exact conundrum. I figured out pretty quickly that the contractors that DID come out wouldn't put anything in writing unless I offered them some money for their time. I found 2 who were very nice who DID, and would hire the one in a heartbeat (the other is retired). 

But yes, if you are just starting out OR are used to doing everything yourself (but need professional quotes for some reason), this wouldn't be something you'd automatically know. Not all of us are Thornton Mellon.  ;)