All Forum Posts by: Mike Scott-Smith

@Lee Ripma and @Jenifer Kynor very useful information!

Thanks @Antoine Martel. Would you happen to know how having a personally backed mortgage would impact an LLC owned property? Would there still be sufficient separation for personal asset protection in place?

Good day BP community,

I have been watching the forums from afar for a while. My wife and I had to step away from potential rental property investing for ~1.5 years for personal reasons. We are now ready to jump back on the horse and are seeking our first rental property.  We have been looking in the Venice, FL area primarily. 1. It is close to our home, 2. The area is lower priced than Sarasota, and 3. There are great beaches nearby.

Before we jump in, I am curious if anyone has insight into the rental market in Venice FL. I know that the homes that we are looking at are older homes, as in they were built in the 70's or 80's. Some of these homes come with some dated features, and finding updated homes are coming at a premium. I have only been looking at homes that my realtor has been sending and have not yet actually toured any homes. 

Before we begin touring homes I am seeking input from other members. Since I will finance my 1st property as a regular mortgage is there an issue having the home under an LLC? Anyone with experience with an umbrella LLC, and each home under in a unique LLC? I have some research to do to determine if there is any possibility in my thoughts as a private financing vs. business style financing.

Also curious if anyone is seeking other investors in the area at this time.

Thanks,

Mike Scott-Smith

@Randy Buff is there much value in these meetings for new investors (like myself)? Have you seen the Oriental Buffet sign at night time? Pretty funny, Only Or....al Buffet is lit!! They have had it fixed but the same letters keep burning out.

@Natalie Roderick welcome to BP. Good luck in your new career,  it is great to see the passion!

@Tobey Porter @Jeff Graves there are several opportunities for vacation rental ownership on many of the Florida Keys along the Gulf coast. Sarasota is home to one of the highest rated beaches in North America (often voted as the best), which is known as Siesta Key Beach.myour research may have already lead you to this information, my wife a and I have looked at several properties on a number of the keys close to us. There are opportunities a plenty that have onsite property management. In man cases those properties manage bookings, at a higher than normal management fee (13-20%). 

The vacation rental is attractive to us, but we won't use it as we live just down the road. We have crunched a lot of numbers, and both in my opinion are buy and hold. But the residential rental option may be our first move. We are still looking and learning at this point. 

Jeff makes a VERY compelling point in his post, time to give that strategy another hard look.

Mike

@Tobey Porter let me know if you need another reco.

@Tobey Porter do you have a realtor in the area yet?

I have this question on my mind as well. I have learned enough to get myself in trouble. Here is what I think I know.

Forming an LLC provides you with some protections between your personal property and your investment properties. This is not to say that you are fully protected. It shall limit your exposure to lawsuits significantly. This is a topic that I will be engaging with an attorney in the near future.

I have spoken with my broker, who sort gave me some of his background with his investment properties. He informed me that he has been personally backing properties via the mortgages that he holds. He then quit claim deeds the property to his LLC. I am not yet certain if this is the best approach. However, I have another friend that owns property here in Sarasota and has all properties in an LLC. The difference between the two are that one has the ability to purchase property with a 20% downpayment (broker) and the other has to go with loans that require 25% down with a 15 year note.

I have also read that some folks form and umbrella LLC and then put all properties beneath in their own LLC. Example...Your Name LLC at the top, 1111 Property Address LLC, 2222 Property Address LLC. I am under the impression that each property is isolated to some degree.

Of course these are all best discussed with an attorney, or similar. I plan on forming an LLC at some point, I am just not sure when it will be.

Hope this helps.

@mindy 

@Mindy Jensen thanks for the input. Good to know for us newbs!