All Forum Posts by: Pat L.

Given the current low 30 yr rates why not finance the SFH @ then use the surplus cash you have to leverage your way into investment RE.
Many HELOC's are variable rates with a 10-15yr term so your pmts are much higher (assuming you intend to pay Princ as well).
Whereas the pmts on a maxed out 30 yr term on your owner occupied would at least be predictable for a long time.
good luck

As a college student I started by buying a house with an owner hold that was close to being demolished.
I then rented all the rooms out to fellow students.
We all worked at replacing the roof, plumbing, & the bottom course of limestone block as the walls were all limestone.
Salt damp was a problem in the area & houses such as this we're collapsing on the first course of wall support. We were all studying engineering & during classes with a professor he told us about a black waterproof hydraulic cement impervious to salt damp that we could use to supplement the first course of the wall. We then covered the outside with a piece of slate to compliment the facade.
After that we looked for more homes the same but always rented the rooms out to pay the bills & the wages in beer.
From that day on I always had RE investments of varying types, with many partners but always looked for unusual opportunities. I retired late in life @ 49 but still live & breathe the RE business.
I am currently mentoring a couple of young kids & having a blast.
Good luck

ditto
nice work...
now I can justify my cost over runs to the wife :)

Sadly we are starting to see 'Amateur Hour Rehabs' that went way over price & are not finished &/or poorly done then abandoned or being sold 'as is'.
The rehab gone wrong on one we viewed would have been too expensive to re-do.

meth residue inspection???
WOW...

Mike gave you some excellent tips...
about the zoning we had a similar case
so we reviewed the zoning laws for ours, a very large old single family converted to a triple illegally.
We were able to get a variance based on the zoning requirements, apt sq ft, off street parking, overall lot size, two entrances fire escapes etc etc.
But they would only allow us to duplex it. The 3rd unit as Mike said had to have the kitchen removed & became storage.
However, after the variance was approved the City was gracious enough to double the tax assessment. So we sold it.

Yours sounds like it has a lot of potential.
good luck

I got these from our tax prep guy.....

Crazy Tax Deductions that the IRS Allowed:

1. Parents put their child in clarinet lessons and argued that it would correct the child’s overbite. The IRS agreed and allowed them to deduct the cost of the lessons.
2. One gentleman used an Amish buggy for business purposes. He pimped it out with velvet interior, special headlights, etc. He used it to drive his clients around town and the IRS allowed him to deduct the cost of the upgrades.
3. A couple hired a babysitter so they could do charitable work. They were able to deduct the babysitting fees on their tax return.
4. A gas station owner decided to offer free beer to customers. He was able to argue, and the IRS agreed, that it could be deducted as a business promotion expense.
5. A man was looking at rental property in the mountains, which was a 5-7 hour drive. In order to avoid the driving time, he purchased a private plane. He was allowed to deduct the cost of the plane as a normal, ordinary and necessary business expense.
6. One individual was advised by his doctor to swim frequently to help relieve severe arthritis. He built a new indoor pool and his condition improved. He claimed that it was a necessary and ordinary medical expense, based on a doctor’s request, and he was allowed to deduct the operating expenses of the pool.
7. Some Dairy Business owners went on an African safari to research wild dairy cows. They told the IRS that it was an ordinary and necessary business expense to improve the quality of their dairy products.

Crazy Tax Deductions that the IRS Denied:

1. A woman wrote a $2,000 check for her gynecologist and tried to write it off as a business expense.
2. An Individual hired an arsonist to burn down his house. He collected a $500,000 insurance policy. He took the $10,000 that he paid the arsonist and tried to deduct it as a “consulting expense”.
3. One man bought mink coat for his wife and tried to write it off as an entertainment expense. He argued that it was a great conversation piece and part of the promotion cost of his business.
4. A woman attempted to deduct gambling losses as a charity donation.

You're right...you never know!!!!!
Our RE agent contacted us about a homeless couple with 4 little kids. Apparently the place they were living in was condemned & they were removed by the Sheriff because they refused to pay the rent.
I cringed when she wanted us to find accommodation for them.
As a favor we offered them a run down LTO we hadn't fixed yet, but they had cash down with some extra from the RE agent & social services.
Its been a year & they have had a couple of issues with employment etc but have caught up & continue to direct deposit faithfully.
They are very thankful & have since done a lot of nice renovation work to the home at their expense.
I think we may have tenants for life!!
here is her last email to us .......

Patrick,
We think it is amazing how much you help others. The way you are helping us is enough. We hope one day we can also own rental properties as well. We adore maureen and are thankful for her and all she has done . Its rare to find honest and sincerely caring people anymore and she is one of the best. As are you and your wife. We are doing the best that we can to keep everything paid. Its been tough the past three weeks our infant was in childrens hospital with a life threatening bout of gastroenteritis and a severe upper respiratory infection along with pink eye and a double ear infection. She lost 4 pounds and we didnt think she was going to be comming home. After 13 days she was well enough to come home and my 6 year old had the gastroenteritis as well it was a horrible illness. Its now finally cleared and we are on the road to a healthy recovery both physically and financially ..so again we are very thankful and appriciate your understanding and patience.
Best wishes
Trisha

TWO & NLY
is where I park my reserves until I am ready to reinvest it back into RE.
Had them for years & its been a great Real Estate play (until interest rates go back up).
Other than that I trade/gamble with stock options selling premium for income.

& aways have a backup plan....
The guy we were using decided to have a vasectomy
He got an infection & was useless for 3 weeks