All Forum Posts by: Alan Hicks

What is your overall tax situation? Flips will just increase ordinary income. Sounds like it would be a decent rental, though. Try it for a year. Sell after day 366 at cap gain rates if you don't like it.

My personal taxes ?

So far this year - $35k in federal tax from my salary.

That hurts just to type it :(

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Originally posted by @Cara Lonsdale:

Originally posted by @Alan Hicks:

Purchase Price : $135,000
Down Payment : $27,000 (20%)

Mortgage = $108,000 @ 4.5%

Tax = $1874/year

No PMI

Monthly Payment + Tax = $788.05

Possible Rent = $1200 ( some houses in same neighborhood are $1300 )

Annual over mortgage = $4943 / 27000 = 18%

I am not sure you have enough of a spread there to make enough money on a flip to make it worth the flip VS holding as a rental. Start at the $155K and work backwards deduct your cost to purchase, rehab, closing costs, any Realtor fees (everyone thinks they will FSBO, but you have to plan for these as sometimes you need a Realtor to help). You also need to account for any Buyer who wants you to pay for their closing costs. Sometimes that is a standard ask for Buyers. Anyway, after deducting all of these expenses, what do you have left? If it is under $10K, then you have to evaluate whether the rental overage (cash flow) is more valuable at that point.

It sounds like the rental income will be worth more to you than any possible profit from the flip would. PLUS, you get the added bonus of building equity in your property while you collect the cash flow from the rent.

One note in your numbers..... I don't see insurance. You will want homeowners insurance, but it won't bump your monthly payment by much. Also, you may want to consider a home warranty to account for repairs, but that is optional, and it sounds like you are handy, so maybe you would opt out.

Thanks for the insight. I agree with you. Buying, fixing, and flipping for only 10k might be difficult.

Buying, fixing, renting, and then selling may be a better option.

I would like to profit $400/month while reducing the mortgage balance ( by someone else ).

Either that.. or buy this su-weet Hunter 410 ( 41 foot ) sailboat I have been eyeing.

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I went and saw it on lunch. it was a rental property ( and renter was evicted ).

Not trashed, but dirty and electricity/water had been off for at least a month.

Agents says they have multiple offers ( including full offer ).

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Originally posted by @Matt K.:

If the basement doesn't increase the value why do it?

I believe it would.

Buy for $135, add 10k for basement, sell for $155/$160.

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Purchase Price : $135,000
Down Payment : $27,000 (20%)

Mortgage = $108,000 @ 4.5%

Tax = $1874/year

No PMI

Monthly Payment + Tax = $788.05

Possible Rent = $1200 ( some houses in same neighborhood are $1300 )

Annual over mortgage = $4943 / 27000 = 18%

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I am going to look at a 3/3 with a full un-finished basement today.

Price = $130,000

Median Neighborhood is $155k.

Rent around $1200

Options:

1. Pure rental property

2. Finish basement and flip

I just finished my primary home basement (1200 sq ft with Bedroom, Full Bath, Library, Theatre, and Rec Room for $10k, and could do the same again for this new house.

Thoughts ?

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Same here. I live in Lawrenceville.

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My thinking is this:

1. Pay 25k to reduce mortgage from $800 to $400 ( 20 years @ 4.5%). This is pure cash flow of $200/month, ( or $200 reduction + $200 I have been paying = $400 ).

2. Use 25k to buy another property (if I can find one ), fight with tenants, for the same cash flow.

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I have owned a house, not my primary residence for 12 years.

Purchase Price = $108,250

Zillow Value - $130,000

Rate = 5.75%

Payment = $822/month

My disabled father has rented it from me for the last 7 years. He is on a fixed income, so he only pays $600 per month. Yes - I am subsidizing his house, which I am fine with and I can afford.

Chase is offering to refinance my mortgage, no cost to me, 4.5%, so my payment will be <$700/month.

Options :

1. Only refinance the balance of 75k and almost break even with rent.

2. Pay 25k on mortgage and refinance 50k. Have a small cash flow.

3. Take 25k, and purchase another property ( if I can find one ).

Thoughts on cash flow, taxes, etc... will be appreciated!

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If I finance the balance (79k) back at 30 years to match the amount of rent (600 / 600 ).

Cash flow would increase by $212 ( the negative I am paying today ).

Anything else?

I assume I can still use as a tax deduction.

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All Forum Posts by: Alan Hicks

Alan Hicks has started 23 posts and replied 59 times.

Post: Thoughts on Pure Rental, or Fix/Flip ?

Post: Thoughts on Pure Rental, or Fix/Flip ?

Post: Thoughts on Pure Rental, or Fix/Flip ?

Post: Thoughts on Pure Rental, or Fix/Flip ?

Post: Thoughts on Pure Rental, or Fix/Flip ?

Post: Thoughts on Pure Rental, or Fix/Flip ?

Post: Real estate agents in Gwinnett county GA

Post: Refinance, Pay Down, or Buy, or Other.....

Post: Refinance, Pay Down, or Buy, or Other.....

Post: Investing Options. Refinance or ...