Appraisals and Depreciation

[Johnny Gonzalez]

Hi all,

I'm hoping some of you guys may be able to help a newbie investor out. After much reading, studying, and vetting, I have made the decision to purchase my first rental property via turnkey with all cash. REI Nation, formerly Memphis Invest, is the company I will likely use.

I understand that an appraisal is required when getting a loan for a property, but is it necessary when buying all cash (other than getting a gauge of wether the listing price is accurate or not)?

Estimating depreciation for taxes: Is getting an appraisal the only way to determine the percentage of building versus land that can be depreciated from the cost of the house? If so, is the appraisal better completed at the beginning of the purchase, or can it be done later on?

Thanks in advance!

[John Teachout]

To find your depreciation "basis" you generally back out the land value which can be found out on the county tax assessor's website. To the purchase price you also add in other costs associated with getting the property rental ready.