All Forum Posts by: Denise Brown-Puryear

@Jordan Moorhead,

I love low income rentals!  I love offering really nice, high quality housing at affordable prices!  

One thing I think should be noted, is the quality of the house will IMO will reflect  the amount of issues you run into with a low or high income house.   We actually have both, and we have A+ tenants in our B+ house, and A+  tenants in our C-, heck even in a D  area house, so I'm going to stress screening.   Find someone who makes the house their home!  

Maybe in general landlords put cheaper or used appliances,  and don't think about maintenance as much as a higher class property.   With a nicer A/B house, the landlords probably check and actively manage and care for it (b/c it's worth more), whereas the cheaper ones, they pass off quickly to a PM and wonder why there are so many unaddressed issues?   If you buy a cheap house, you know has been neglected, you better be prepared and ready to attend to the issues.   It's definitely not the same,  so just be ready for a different game. 

@Denise Brown-Puryear,

I so agree with you both as well.  Especially, "finding someone who makes the house their home"!  In the coming year, there are going to be even more renters looking for a place to call home until they can get to a place of purchasing down the road.  Meanwhile, we do provide a viable and valuable service.... "high quality housing, at affordable prices"!  Way to go Jordan.

congratulations on getting through it! What in particular did the IRS focus on - you mentioned they were interested in your being a RE professional... What information did they look at closely?

- though the initial IRS letter said they were contacting me because of the fact my passive losses were greater than 25k, they literally went over everything. You name it, they looked at it. That it's what a field audit is unfortunately... they look at (or have the right to look at) everything 

Is there anything that you will do differently going forward based on this?

- No, except for what was mentioned above

about some things that you were glad that you did that may have saved you some hassle?? 

- even though I have crazy complicated taxes, and I report everything correctly, they probably would not have even said anything if I was not filing as a real estate professional and exceeded the 25k in passive losses (which were legitimate since I could claim that status)

 tips for the rest of us?

- Just keep good books, keep all receipts and be honest. Also, be sure to issue 1099s to everybody you pay more than $600 to. Some folks say you do not need to do it in the real estate business, but yes you do and it is good practice anyway. That's it

When it comes down to it, people are animals and our animal DNA pushes us to survive through the least amount of effort possible. A wild cat has the ability to eat, drink, and defend itself for its entire lifetime, but bring it indoors and feed it for a few weeks and it won't leave because well heck, life is a heck of a lot easier in here with this person doing everything for me. People today can eat without ever cooking, let alone hunting or farming, sleep without ever building a house, and chores like washing and cleaning involve pretty much setting timers and pushing buttons or hiring someone to do it for you. If you can't get a job to afford any of those things, no bother, we've got programs that will steal from productive people to buy them for you.

This is was makes entrepreneurs unique. They're like the wild cats who might be raised in the domesticated life, but never fit in and eventually and turn away because while it might be more work, the life outside brings with it so much more freedom. Most people are just house cats who are born, schooled, and trained to be behave well while domesticated and then go on with a fairly structured and comfortable life that lacks any real freedom. Like the house cat, they might tire of the lack of freedom from time to time and make a break for the door when they see the shiny light outside, but they will be howling out on the back steps a few hours later once they get hungry or it starts to rain.

My point is, don't be surprised that most people don't want to do the work it takes to live a life of freedom. This is not to say that making the choice to live a structured life as an employee is wrong or less fulfilling in any way. Heck, it's the life I live right now. That being said, those of you trying to teach others about the other way to do it, don't be shocked when you lead horse after horse to water and they refuse to drink. It's not just millennials or "kids these days". There are centuries of human social evolution and programming that's gone into making the majority of people behave the way that they do. One book or one podcast isn't going to undo all of that. Frustrating as it may be, just try to lead by example, produce good content, answer questions when asked, and let people make the decisions they want to. They might not be better off for ignoring your good advice, but at least you'll feel sane at the end of the day!

@Rohan J. You might want to consider SFR. I initially started by focusing on MF (bc it seems easier & scales more quickly) but I quickly realized a lot of the best metro areas with strong economies mostly only have great deals on SFR, not really on MF.

Many of the great MF deals in America are in subpar metro areas (economically speaking). Focusing on SFR takes longer to scale but you'll probably have a better time finding great deals. And it's ESPECIALLY tough to find great MF deals as an out of state investor bc when the occasional great MF deal does crop up, odds are that someone local will make an offer before you're even aware it's on the market.