All Forum Posts by: Kyle Samuel

Lukasz Z. If the main thing your business will be doing is buying, rehabbing, and selling houses, I would create the LLC to do just that. I enter all contracts to purchase real estate under my LLC, unless I'm dealing with an REO or short sale, in which case I use my personal name and then quit claim it over to my business at the closing. In regards to getting your HIC license or not, if you own the house under an LLC you will not be able to pull any permits without the HIC license.

My first deal was a short sale. Took 6 months to close and 6 months to renovate, sell, and get paid. Estimated ARV was 250, sold for 220. Estimated repairs were 50, actual repairs were closer to 70. My partner and I at the time spent every available hour at the property doing anything we could to save a dollar here and there for 2 months straight. This house was a complete disaster in every direction. The outside was ugly, the roof was basically caving in, the driveway was non existent. The interior was a full gut and all the mechanicals in the house had to be replaced. The previous owners pulled out the support columns in the basement for some reason, so we also had to jack up the second floor and first floor to level them out. In the end, we walked away with a little under $5k split 2 ways, which worked out to a little over $3/hr. From that point on, I learned not to be as optimistic with my rehab and ARV numbers haha.

Josh Allen From one CT investor to another, welcome to BiggerPockets.

@Richard Rheker

On my first rehab, I was hell bent on saving dollars wherever I could. I did anything I knew how to do and then some. I worked with a few select guys on things I didn't know how to do to learn as much as I could. I learned A LOT on my first rehab, significantly more than I could of learned from reading anything, especially since my first rehab was a full gut with new everything inside.

After my first rehab, it was very obvious to me that it wasn't an effective use of my time to try and save a few dollars here and there by doing simple tasks on my own. While learning the basics of each step of the rehab is very important for dealing with contractors, I'm a big believer in letting professionals do what they are in business to do. For the most part, while I know how to replace a roof on my own, someone who does roofing for 50 hours a week, is going to complete the job in a much more efficient manner than I ever could, and this applies to everything if you work with reputable contractors. The first house took me 2.5 months to complete because I was doing a lot of the work myself vs in July I bought 3 houses and rehabbed all 3 of them simultaneously in a month.

Now, I view my time as being best spent looking at houses and making offers on new properties. The only thing I still do on all my houses is the tile work, and I only do this because I enjoy it, not to try and save a few dollars here and there.

@Jimmy S. When I purchase REO properties that are listed "as-is" it just means it's unlikely that the bank is going to fix any of the problems of the property. When you write up your offer, you would still have an inspection contingency in there to allow you to do an inspection. If anything comes up during the inspection, you can still back out or reduce your offer to account for the issue.

Welcome to the site @Nader Zaveri . I'm sure someone on here will be more than happy to let you pick their brain for information. The one thing that can be said about real estate investors is we all love talking about real estate investing.

Good luck

I will make multiple offers in the next 5 days!

@Bill R.

Yes it has been awhile, keep me informed on any deals you come across.

Good to see you are still doing deals, because I need some haha.

@Curt Smith

i DEFINITELY agree with curt on a few points. If you find your CPA bending tax law too much, it will eventually catch up with you. Numbers are what they are and nothing more. The main advantage of using a CPA is tax planning more so than taxes. An experienced CPA will be able to help you regarding when to take certain deductions immediately vs depreciating them over time which can make a big difference.

In the end, the IRS is going to get their money. And if your CPA is taking your actual expenses and inflating them to create a false sense of worth, then they are not a good CPA. This is short-term thinking and in the long-run will just create MANY more problems for you and your REI career

I would take a different approach to choosing a CPA. I was a CPA for a few years and worked in a large firm with 400+ CPAs and a small firm that employed 4 CPAs.

I would, respectfully, disagree with choosing a CPA based on them being a 1 man show that doesn't bill for every little thing you ask them. All CPAs are not created equal. Tax laws change all the time, so just because someone has been in business for 30 years, doesn't mean they are up to date on all the new tax laws. I worked with one CPA who was 75 years old, had been a CPA for his entire life, but all his clients were just as old as him and I wouldn't have wanted him to have any part in my taxes or tax planning. I would say finding a CPA who is familiar with real estate investing is the most important thing to look for, preferably one who is involved with real estate themselves, such as owning rental properties.

Everyone in business is in business to make money, and time is money. The smaller firm I worked for employed 4 CPAs. 3 of the CPAs did most of the work and the owner spent his time responding to emails and talking with clients to answer questions and solve problems. You might find with a 1 man show, that they are spread too thin, and response time may increase. I wouldn't expect to be billed for calling with a quick question, but I would also ask about something like that upfront.