All Forum Posts by: Alan Mackenthun

if you're called on it, there likely is a legal problem, but if I was listing the right property, I wouldn't hesitate to do it.  They can produce stunning landscapes.

You'll also have holding costs.  Utilities, trash, property taxes and insurance for the duration of the rehab and selling cycle to consider...

1st, if you buy it for $50k and put $20k into the rehab and then sell it for $100k, you haven't made $50k in profit.  You've made $30k in profit.  But you actually haven't.  You've got buying and selling costs to be considered.  How much interest did you pay on the debt on the credit cards?  Any inspection prior to buying?  There will certainly be some taxes, closing and other costs.  They all have to be deducted.  You'll almost certainly have some realtor/broker fees when you sell.  You might end up with $15 profit on this deal the way it sounds.  You can pay off all the credit card debt with the proceeds from the sale before taxes since those are just business expenses assuming all the cc debt is from the purchase and rehab of the property.  You might be able to roll the profit into your next purchase with a 1031 exchange, but you're likely best to pay the taxes and move on, but I don't know the costs for a 1031 exchange.  You would need to pay close attention to the rules.  You have a strictly limited window to sell the 1st property and buy the 2nd.

I've tried to buy, but haven't been able to get prices I was willing to pay.  I won one bid that had been listed as occupied.  After winning the bid I found out it was not occupied and had been foreclosed a while back.  After poking around some more I believe they just didn't want people to see how bad it really was.  They advertise extremely low starting bids, but the reserve prices are often 3 or more times higher than the starting bids.  People do buy there, but I'm about ready to stop wasting my time.

I've started using Podio for task management.  It's kind of a development platform with lots of free apps available for use. 

I'm not perfect and I haven't met any renters who could claim it.  17 years is a long time, though at the same time, an eviction is a big red flag.  I'd talk to her and pull the credit.  If she's being honest and if her credit is now in good shape, I'd give her the lease.

The one benefit I'd see is that if you buy as a separate company, you can sell one or the other separately down the road. Other than that I don't see a lot of benefits for a single owner LLC. All the liabilities come back to you personally anyway from what I hear. I'm sure others will have better insight. I'm facing the same question right now, but with multiple owners of the corporation. We're likely to set up a separate company as the owners of the real estate will likely vary a bit from the owners of the software company.

 I found top quality laminate flooring on clearance at a local big box for $1.20/sf at 55% off.  I've used $0.79-0.99/sf cheap laminate before, but this really does look and feel so much better. 

I've bought in 2nd ring suburbs and I've bought downtown.  I sold downtown and am not buying again.  With the crime, the deadbeats, and the city bureaucrats it's just not worth my time, aggravation, and safety.  The returns may look better, but be sure to account for increased vacancy, non-payment of rent, higher maintenance needs, higher maintenance costs, higher permitting costs, higher real estate taxes cost, and finally the robbery and burglaries that you are likely to face in those areas.  Some or most of these can be managed.  Personally, I do well where I'm investing and I'll stay away from downtown. 

Tough question.  There's tile throughout likely because it was a rental and people didn't want the maintenance.  Personally, I'd hate it, but if it rents with the tile, then leave it.  If you can't get any renters (or decent renters) the way it looks now, then consider other floor coverings.  I'd replace it with a high quality laminate that I got on clearance (at least that's what I'm doing today :) ).