All Forum Posts by: Michael King

Yes of course depreciation is your friend, and all your expenses used to make the income. Your CPA can give you a list of what you can and can't claim.

 How long did it take to get $1000 and how hard was it? Is it repeatable?

So....why don't you take the 30 year one, cash out at 75 or 80% LTV, then repeat and buy another one. If you're at $500 a month and looking to increase cash flow, replicate the first one and now you have $1000 a month. And it seems like you'd get more money out than you ever put in the first unit.

I made the mistake of paying off a property when I had the chance, for increased cash flow. And while I have the increased cash flow, I could have gotten even more cash flow by buying several more properties. Lesson learned.

Well I'm no lawyer, but I recall opening my LLCs and reading somewhere that if the business operation is primarily held or conducted in the state of MO (where mine are), then the LLC needs to be registered in that state. Myself being undereducated, I would register businesses in each state.

But like I said, I'm no lawyer (I've argued with a few), and someone here will hopefully set you and me straight.

If the landlord owns the place, payment is via rent and it's an income that should get reported to the IRS. If the 'landlord' is a third party, such as property manager, payment is via commissions/management fees. Which is about 10% total. Again, reportable for tax.

I see we have a battle here between airbnb and booking. Can someone chime in with comparisons on VRBO and any other similar websites please? I'm toying with the idea of a vacation rental. 

Another thought, rename the closet as an 'electrical closet'. Just like @Mike Cumbie said, get rid of it. 

Buy an enclosed 6x10 lockable trailer. 

When you say box, do you mean electrical panel with all the breakers? And this is a building inspector that said this. What about your city's occupancy inspector and fire department? Also an electrician for a bid on moving it. 3 phone calls there you need to make. 

In my area, the fire department would not 'grant' me access to my home until they had conducted an occupancy inspection ($100 fee). They couldn't enforce me to not live there, but it gave me piece of mind. 

At any rate, it's worth mentioning it to the sellers to see if they'll fix it or sweeten the deal. And if they say you can walk, then what? Are you still happy to continue with the buy? 

My PM does a market comparison for me, but in my area it's pretty easy. About $1.00 a foot is a good starting point, give or take 15%. A lot of factors enter into it I'm sure you know, but once you've done your market research you'll know almost immediately what a property will rent for. Obviously that's the most important question for the owner, but the most important task for you is proper screening to ensure success for your clients (nobody wants an eviction).