All Forum Posts by: Ruth Ann Morris

I sold a duplex in Florida in December with the idea of turning the profit into two new rental places in Sioux Falls before the end of the year.  It didn't happen.  I now have expenses from the search (inspection fees, airline tickets and rental car expenses) that I am not sure where to put because they happened in December.  I did eventually close on two places in February but the costs straddle two tax years.  Can I count them in the costs from the place I sold to buy the new place?  I know I should have done a 1031 exchange but I wasn't sure how to do that and it was difficult to orchestrate while living out of country... 

At 10%, the property manager should be handling this and not you. Should they contact you and let you know what is happening? Yes! But you should not have to be scheduling the work yourself. Look over your contract with the PM to make sure it is set up that way. If it is not, I think I would be renegotiating the contract or looking for a new PM.

I would definitely get it inspected. I was interested in purchasing a 4 plex that was listed for a reasonable price. I had it inspected and discovered that there was evidence of a fire in the attic, it had knob and tube wiring that was not sound, there was a misplaced support beam in the basement which was causing the floor to sag among several other issues. The place may have looked like a bargain, but the repairs would have increased the cost by at least 50 percent. The inspection saved me from making a BIG mistake.

Thanks for the info, John Huber!  I am a newbie on the site, so don't know about all the resources yet.  Great help!

I would rent as a SFH with a wonderfully finished basement. It would be over 2880 sq.ft of living space. I would be able to charge close to what I would get renting as two 1440 sq. ft. Also, I do eventually plan to live about half a year in Sioux Falls, and it is a place I wouldn't mind living. So, while there would be some loss of income, it would not be a major loss.

Steve Babiak, I have enough cash and credit to cover just about anything that could come my way on the places.   I just prefer to keep it to cash and not credit, which is why I would put off some things that can be worked out otherwise.  

@Donald Morrison, I have a feeling it is not a legal apartment because it is listed as a SFH in the legal descriptions. The ads for the place said duplex, but legal says SFH.

Thanks for the great dialogue.  I am getting great ideas on how to take care of the issue.  I have discovered after checking with my realtor and the current owner, that the tenants already split the costs.  That is a relief and sets the standard by which I can do business.  

Sarah's response is better than mine in that is sets up a better solution.  If the written lease could be assigned to you, then you have a legal standing to deal with the tenant.  It still could be challenging but not the mess I got stuck with.

@Steve Babiak, I agree.  However, that would have to occur down the road because the finances aren't there to do it right now.  So I am trying to come up with the best solution until such time as I can do that.  The place is a single family home that has been "split" into a duplex with the downstairs rented out.