All Forum Posts by: Tim Delaney

Like I said, I'm not an accountant so you should probably talk to one. Where did you get that calculator? I don't see any capital gains on that, just an adjusted tax basis. If you take the $653K out of loans and put it in the cash line there would be no change to the total adjusted tax basis and therefore capital gains would be the same.

Joint Venture. Basically a partnership. While JV's can be more all encompassing, generally they are used for a single deal at a time.

Not sure what the laws are in CA, but if you were supposed to give 60 day notice you are already too late. If they haven’t been paying and causing problems why would you want them to stay? Don’t renew the lease and hope that they move out.

Loans have nothing to do with cost basis of a property for determining capital gains. 

Welcome Kyle. Depending on how much time you have to commit to real estate (or want to considering your dollar per hour is probably better spent in dentistry) you may want to consider becoming in LP in a real estate syndication deal. After getting the operators and the deal it is pretty passive. BP also launched Passive Pockets podcast and platform where you can learn more about this.

This is called OPM - other people’s money. Brandon Turner wrote a book for BP called Investing with Low or No Money Down - start with that. Then listen to any podcast that talks about this (which is a lot of them).

Are you looking to hold on to these as rentals? That would be called the BRRRR strategy - there is endless info on that strategy here and on the podcasts and in the BP bookstore. Buy, Rehab, Rent, Refinance, Repeat. Because you are forcing equity into the house you are sometimes able to pull back out the entire purchase and rehab process to return to your investor then you own the home with just the mortgage. In reality this strategy still works, but we are having to leave more of our own money in the deal because prices are high and/or rent won't justify maxing the cash out refinance because interest rate is high. It is still better than putting 20-25% down and not forcing equity appreciation though.

In reality, before you start getting investors lining up to fund 100% of your deals you will probably need to prove yourself in some way. Try to get some experience by helping your friend with some of his projects.

BP has a book on Partnerships written by Ashley Kehr and Tony Robinson.

On the technical side I would suggest partnering on a single flip which can be done with a simple JV agreement before jumping into creating an entity and crafting very good operating agreements. This will give you the chance to see how well you work together before committing to more overhead.

If both houses were sold in 2024 then the loss will negate the profit from my understanding. I am not an accountant though, so take my input with a grain of salt.

It would be great to have all three strategies going in one house! Using a househack for an STR could be particularly advantageous in municipalities where STRs have been cracked down on more but still allow you to do it if you are living in the property. Being able to A/B test MTR at the same time would allow you to know if you can convert the STR to MTR if you ever want to move out and keep the property.

As for the net negative house hacks - I always like to remind people that shy away from a deal because they aren't making money that they are usually still coming out ahead if they are spending the same or less than they would on rent.

It doesn't sound like it. Best bet is to carefully analyze the zoning maps and regulations or just call the town and ask.