All Forum Posts by: Aaron Smith

Not sure about your loan terms. If its an owner occupied loan, look at the terms. With FHA you have to have the intent to live there for a year. Intent isn't a black and white thing.

Also, if you do live in a place for at least 2 years in a 5 year period, you can sell it tax free, so keep that in mind too.

*if he does 

Maybe consider purchasing the tax lien at auction.  I do hear it's a long drawn out process, but you could get the property for very little (if the owner doesn't pay the taxes eventually) he does, you get your money back plus interest, so still get a return. 

With those being popular neighborhoods, could look into condo conversion too as a potential exit strategy.

I've gone through almost identical steps as you with not seeing any deals from conventional means and I'm also looking in the same range of units as you.  As far as list source, I also noticed the same issue with the % equity, which is obviously a key metric.   So that's too bad, not sure why it doesn't work with multifamily.  So, hopefully the yellow letters mailing campaign will yield results for both of us. Good luck.

@Bill Exeter

Thanks, that does make a lot of sense.  That helps a lot to understand how a project might be taxed given different holding periods.  Thanks for your insight.

You also want to look at job growth, and how much new construction is going on.  Supply and demand for housing.

@Coco Cook

Check out Marcus and Millichap 2016 Multifamily Investment Forecast. Hopefully they come out with 2017 soon, not sure when that happens. There is also IRR Viewpoint 2016.

I think its a smart move to look at cities with increasing populations that are in the buyers market part of the cycle.  The county as a whole is in the sellers market part of the cycle, but some cities have better value than others.

@Bill Exeter

@Dave Foster

@Joshua Smith

Alright guys, this is a good one.

Say I buy a fourplex vacant, rehab it, condo-ize it right after. To qualify for either a 1031 or long term capital gains rate, you need to own the property for a year (or at least thats the rule of thumb). So in this case, would that be a year after I condo-ize and create 4 new titles, or a year after I originally buy the building? A bit tricky, thanks in advance!

Thats great, relieves the pressure a lot.  So I'll plan to make a lot of offers right before I list my property. Thanks again.