All Forum Posts by: Tasha Davis
Tasha Davis has started 6 posts and replied 15 times.
Post: Savings for repairs, emergencies, etc
- Albany, NY
- Posts 15
- Votes 7
I just bought my first 2 unit property- I am house hacking currently. How much money do you think I should save for reserves in case of an emergency or if work needs to be done? 5,000 a unit? more? less?
Thanks guys!!
Post: zoning. important? expensive?
- Albany, NY
- Posts 15
- Votes 7
Post: Hudson Valley's Real Estate Investment Discussions
- Albany, NY
- Posts 15
- Votes 7
is this still a thing in the 518? I would love to connect with other investors/landlords/anyone doing anything real estate!
Post: HELOC question, first time investment
- Albany, NY
- Posts 15
- Votes 7
I will also be living there, I forgot to mention. I guess asking the bank is the best way to go! Thanks guys!
Post: HELOC question, first time investment
- Albany, NY
- Posts 15
- Votes 7
Does anyone have a HELOC? I will be closing on my first investment home in about a month and I was wondering if I should request a HELOC now or wait until I have some money invested in the home. I got it for 95,000 and it is appraised at 120,000- obviously I have nothing invested in the home yet, as I don't own it yet. There are a few repairs that are needed, nothing major, but I would rather get it all done at one time than save and fix one thing and save some more and fix another thing (UNLESS THIS IS THE BETTER THING TO DO) thoughts? ideas? suggestions?
I am in no position to dare to ask anyone else for money yet, from what I have read and listened to, generally, if you own property, you tend to owe federal taxes. I do also have a day job- I'm a licensed social worker, and I know that there is no real way for anyone to tell if I will owe taxes, but how don't you? I am also going to be filing single with no children, so I don't have a lot of tax breaks in my favor!!
I have a day job - don't know where you're coming from - but I have found that my my federal tax refund has gone up after my first few rental homes. I'll pay the piper in a couple decades but for now that isn't a concern. But I do make sure I keep a certain amount in reserves for repairs and the like before finding the next deal. But I'm not very good yet at using other people's money...
This is super helpful, has your federal tax changed at all? Do you tend to have to pay back taxes or do you receive a refund?
Second part of question, Are are you able to save for federal tax on rental income, money for if things go wrong and money for a down payment for another house?
Sounds like several questions into one. Yes to all three. You are able to save money on your federal tax return, and state, when you file schedule E, rents and royalties. This schedule will total all rents and expenses. This will include depreciation for the building, but not the land. You can expense 53.5 cents per mile, so you better start keep mileage records.
You should start saving money from the net rents you receive, build reserve. Unexpected expenses will occur. Get good at repairing things and make Home Depot your best friend. Keep all receipts.
After a few years, your reserve will build. You get good at fixing things. if you don't know how to fix something, there's always a youtube video. Buy bulk on items you know will need, like toilet flaps, control values for toilet, even look for used snake for drains on craigslist. The reserve could someday be used for down payment of another rental.
Terry
There is so much for me to learn still!
So maybe I don't quite understand, but wouldn't refinancing just increase the amount of payments on the home?
Originally posted by @Andrew Syrios:
Originally posted by @Tasha Davis:
Do you recommend refinancing as soon as possible in order to continue to purchase as many as the end goal is?
Don't worry about going super fast, especially at first. Just do one, then get it refinanced, then go onto the next one. As you grow bigger, things start accelerating and you're able to buy more faster. The biggest problem in real estate I see is people afraid to jump in. The second (other than maybe underestimated rehab costs) is people who get delusions of grandeur and want to grow too quickly.
I would refinance as soon as you to get long term financing on the property. Just make sure the bank is willing to refinance you at the appraised value instead of the cost you have into the property (this is called seasoning). Some things you want to do fast (rehab it fast, rent it fast, refinance it fast), but it's also important to grow at a sustained rate and not try to get from A to Z all at once.
Do you recommend refinancing as soon as possible in order to continue to purchase as many as the end goal is?
Don't worry about going super fast, especially at first. Just do one, then get it refinanced, then go onto the next one. As you grow bigger, things start accelerating and you're able to buy more faster. The biggest problem in real estate I see is people afraid to jump in. The second (other than maybe underestimated rehab costs) is people who get delusions of grandeur and want to grow too quickly.