All Forum Posts by: Tim Johnson

Unfortunately, yes. Whether you're doing it yourself, or using services like propstream, RedX, etc. everyone scrapes the same public sites for numbers so there is always a percentage of disconnected or wrong numbers. The great thing is that when you dial enough numbers (and most of my colleagues use a dialer) you'll reach a lot of people. It's a "numbers" game :-)

They've been perfect tenants. Switch to M2M with a moderate 4% (or full 8%) rent increase and the requirement that you be able  to show the apartment to prospective renters as soon as they give notice (written into new M2M contract). Then, with new renters, you can bring the rental rate up to market.

Discussion of LLCs is a big topic and filled with many factors with no 1-size-fits-all solution. The short answer is that most investors when starting out will need to purchase the property in their own name in order to get the best rates and terms on conforming loans as well as FHA and VA loans. If you have other finances available, then of course the conversation quickly changes to other factors like liability, privacy, and efficiency. I would suggest talking to your CPA / tax person first - to see if it would be right for you.

Discussion of LLCs is a big topic and filled with many factors with no 1-size-fits-all solution. The short answer is that most investors when starting out will need to purchase the property in their own name in order to get the best rates and terms on conforming loans as well as FHA and VA loans. If you have other finances available, then of course the conversation quickly changes to other factors like liability, privacy, and efficiency.

Join local REI groups - via meetup, facebook, nextdoor, in person..... realtors, investors, prop managers, and others tend to congregate there. In ANY business, there is no short cut to actually meeting people. The most real friends = the most market share. Eventually you'll find those cash buyers / investors who are also hungry for a good wholesaler who can feed them consistent deals.

Great start with Rentometer and Zillow. Then finish it up with a call to 2-3 local property managers.

Congrats. A great way to get started in your investing!

The taxes you file this spring will deal only with 2021 so you won't be claiming it as a rental yet. If you don't take the standard deduction (and most do these days) you could deduct the interest on your mortgage.

Looking ahead to next year, you'll file a Schedule E. Your rental income and pay-down on the principle are taxable. However, you'll be able to deduct the interest on your mortgage, capex expenses, as well as begin the depreciation. You'll be surprised at how well those will generally off-set your rental income. 

inspections are usually part of the buyer's due diligence (and expense)

"What are some ways of thinking to get around the fact that you may pay much more in interest than you will initially on the principle?" 

You don't. That's what it means to amortize. 1. Make sure that you have steady tenants in place to pay for this. 2. The power of deducting interest payments and depreciation on Schedule E will bring a smile to your face and help you forget about the pesky cost of loans.

Seriously, yes, the tax deductions are just that beneficial!

Not enough context and numbers here to give a full  response. However, using the following numbers:

Purchase price: 283K / Monthly rental: 2600 / Vacancy rate: 5% / CapEX and Maintenance: 5% each / Property Taxes: 3000 / Insurance: 1000 / Property management: 8% / Finances: 3% closing costs, 20% downpayment, 5.23% interest rate, 30-year amortized / Appreciation: 4% ....

I come up with 7.12% cap rate and a COC return of 8.03% . If you add principle pay-down and appreciation to that it becomes 30.54%

In my market that would be a green light deal. Of course, if you could update the home and bring in "a few hundred dollars more" of rent, these numbers would get even better.