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All Forum Posts by: Michael S.

Michael S. has started 17 posts and replied 76 times.

Post: Hold or sell

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7
Originally posted by @Jordan Thibodeau:
Do you have any costs you can have the tenants pay? What costs are included in the maintenance number? How many time per month are you spending on this house? Do you have a month to month lease or a year lease? Are you charging market rates for rent? Do you have a rent escalation clause in your lease agreement?

I agree. Have the tennant pay for the lawn care or make them responsible for mowing the lawn and save $800 a year. Hell, even if you were to buy them a lawnmower yourself for $200 you would save $600 in the first year.

Post: Need help with audio books, mp3's, etc

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7

Do you have a library card? If so, download the Overdrive app for free onto your device, then link your library to it. Now you have completely free access to PDF, ebook and audiobooks.

Post: Best places to find info on new home construction cost?

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7

What do you guys think about insurance companies estimates to re-build a property? Obviously they have a vested interest in over-estimating your repair cost in order to get you to pay for more coverage. Are certain insurance companies more accurate in their re-build estimates?

Post: Tax deduction/mileage

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7

I am no expert, but I did read the NOLO book in Investment Real Estate Taxes. I highly recommend this book.

According to said book, deduction of mileage traveled for investment real estate is deductible from the income of said rentals. However, if you don't yet own a property in that area, and drive 500 miles to look at houses, but never buy, you cannot deduct those expenses. But, if you buy a house in a city 500 miles away and rent it out, and later you drive over to look at buying a second house, that prospecting trip is now deductible because you have a "business" in the area.

In your case, I believe you are OK deducting the mileage driven in direct support of your rentals.

I am not an attorney or accountant and this is not professional tax advice.

Post: What grade of paint to use for rentals?

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7

For those of you who don't use flat paint, if there is a small mark on the wall between tenants do you re paint the entire room? I have heard its impossible to touch-up a small area with anything but flat without having a spot that permanently looks "wet."

and this would be for a mid to high end rental, not the ghetto.

Post: Renewals: Month to Month or make them sign a year lease?

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7
Originally posted by @Jon Holdman:
I do nothing but month to month leases, right from the start. If a tenant decides they need to leave they will leave. You can cause some problems, but there's really little you can do to stop them. A long term lease ties your hands much more than theirs. With a month to month lease you can terminate the lease at any time (with proper notice) for any reason.

Are most of your properties lower end rentals Jon, or are we talking $2000/ month SFH or condos?

Post: Termite Bond in South Carolina and Georgia coastal areas

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7

For those of you in the South Carolina/ Georgia coastal areas, do you purchase a termite bond to cover your buy and hold rental properties? Or, do you choose to do preventative maintenance yourself, via sprays and stakes that you place in the ground?

All of my homes are built on slab. I don't have any termite problems yet, but I just want to be smart and economical about preventing them. I have heard quotes for $200 a year for a termite bond that will do annual treatments and cover all treatment and repair costs should an infestation develop.

The way I look at it, if there's say a 5% chance any given year that I get a termite problem, and the cost to pay for the treatment if caught early is only $2000, then its not worth the cost of the bond. The big "IF" there is catching it early if there is a problem.

Post: Favorite Solo 401K company? Why?

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7
Originally posted by @David Jayne:
&
I believe Michael is right, you can't roll it over until you leave employment with the military. You can close it down, but you will pay about 50% of the balance in taxes/penalties. You can also borrow against it if you want to free up some cash now. I've done two loans, getting ready to do my third. Only $50 admin fee, and you pay yourself back at the G-fund rate (somewhere around 2.25% currently). Only issue is you are supposed to pay it back before you leave or they may require the loan balance to be due upon your separation.

Now that sounds like an awesome deal, but is the maximum $10,000?

"The maximum loan amount is the smallest of the following:

  • Your own contributions and earnings on those contributions in the TSP account from which you intend to borrow, not including any outstanding loan balance;
  • 50% of your vested account balance (including any outstanding loan balance) or $10,000, whichever is greater, minus any outstanding loan balance; or
  • $50,000 minus your highest outstanding loan balance, if any, during the last 12 months. Even if the loan is currently paid in full, it will still be considered in the calculation if it was open at any time during the last 12 months."

I just checked out the website, and that looks like an awesome deal, except for the $10k max. Did you do general or residential loans? If residential, how long did it take to get everything squared away? Could you set everything up ahead of time so that you come in basically as a cash buyer, or is it as complicated as doing a typical bank mortgage?

Post: Favorite Solo 401K company? Why?

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7
Originally posted by @Edwin E.:
@Michael S. and @David Jayne I have a question about TSP. I have one. I don't want one any more. I would like to roll it over into a SD401K. I'm in the process of speaking with Dmitriy to work this process out. My question to either of you is have either of you done this?

Good luck. My suspicion is that they won't let you move it until you retire or separate, but I don't know for sure.

Please post your findings as I am very interested to see if this works out.

Post: Forbes say Millennials are going to have a tough time...

Michael S.Posted
  • Rental Property Investor
  • Beaufort, SC
  • Posts 82
  • Votes 7
Originally posted by @Zach Zepp:
Why not get the best of both worlds? I recommend National Guard over Active Army. You get the benefits of military service and a civilian career. NG will pay for a portion to all your school as well.

We could really go down a rabbit hole here, but since this is a real-estate site not a military site I will try to keep this short.

If you are in a non-combat arms MOS and you forsee limited risk of future mobilizations because of war fatigue from politicians and the American public, then you are probably OK going that route.

If you are in a combat arms MOS I personally don't think the reserves is the way to go, especially when you are just starting out. I have many hobbies in which I don't mind being an amateur. However, when I go to war I would prefer for myself and those around me to be professionals-- especially my leaders. I know that won't make me any friends with the reservists out there but its the truth.