All Forum Posts by: Carrie Penney

@Athena Pettway, good idea! I'm gonna check into that. Thank you!

@Andrew B., unfortunately it is not possible for me to get down there. I am a full-time graduate student, work full-time, and also manage four of my properties as ST/AirBnB rentals (tons of work). 

Many have suggested speaking with a professional, and while that is sound advice, I was hoping for some clever tips that maybe some of you have used in the past. I know lots of us have been through the eviction process, and thought I might hear some funny/interesting stories. 

What I've learned over the course of the day is that these people have a particular issue with ME buying the house. They somehow feel that I am taking advantage of them, even though they have NO stake in the house, and my mom is getting more out of the deal than she paid. Also, she'll get to live with us for free and have the added benefit of us finding her an income-producing property. In addition to that, we've offered to give them time and money to settle into a new place, which will allow them to move closer to work (currently a 45 minute, one-way commute). It's a win-win-win and I cannot see their side of the argument at all, as they have never paid a tax bill, insurance payment, repair bill, or even any rent.

Anyway, since their issue is with ME, my mom told them that we backed out of the deal because we didn't want the headache of buying a house that was 6 hours away. She told them that she took the next-best deal (85k v. 100k) instead and they were pleased with that. They are now willing to vacate by the end of March. So they have the same time frame to vacate the property, but will receive no financial assistance from us. Their expectation now is that my mom will take that 85k (less 20k for tax) and buy them ALL a new house to live in, BUT they want the new house in THEIR name. First of all, good luck finding a 3/2 house near Austin, TX that is in livable condition for an all-in amount of $65k. Second of all, why would it be in their name? So at this point, we're all just playing along and once they get moved into an apartment (they think it's short-term until my mom finds a house to buy them...) we'll all just bail and block their numbers. 

So even though it feels a little more secure, it's all still hanging on them actually finding an apartment and moving. And they have no money to pay a deposit/etc, so we will probably still be paying the moving expenses for them, just under some other crazy made-up story to appease them. 

Real estate, so fun! 

She won’t, or at least, doesn’t want to, because it will be incredibly awkward as she still has to live there with them. She expects some type of retaliation from them, property destruction, etc, which is why we’re hoping for another solution. But it may come to that. As far as taxes, I’m more concerned about paying on the perceived gain on the property. It could show a gain of $160k when really it’s only $60k. Since we would be “buying” for nothing, essentially. Though we would give her $80k after the re-sell. Surely there is a way to structure the contract to reflect this?

No lease, but the utilities are in their name, so I can’t have them shut off.

This is a little complicated to explain, but I'll try my best! My mom has gotten behind on her property taxes and her house (fully paid off) was set to go to auction on Tuesday, March 6.

We (fiance and I) have just overnighted payment for the property taxes (close to $20k) to take the house off the auction list and we have made a deal with her to give her $80k after the house re-sells. She bought the house for $95k 5-6 years ago and we are are essentially giving her $100k, so the deal is very fair to her.

The house will probably go for $150-160K after we update it ($5-$8k of work). In the meantime, my mom will move in with us and we will be looking for some type of investment property for her so that she can pay her bills and not get behind on taxes, etc again. This is the second time I've bailed her out (last time was $13k for the tax bill), so now we will be managing her finances for her.

The part that complicates all of this is that she has these "roommates" (married couple) that have lived with her for years. Obviously they have not helped with the taxes at all, or paid any rent. They have paid utility bills for about half of the time they've lived there, but no other contributions. Now they are being very vindictive about moving out and feel that they are "owed" something and that they have some type of stake in the house. Being that we were just gonna have a contract and possibly assign it to another buyer later, or close on it ouselves at some point, we are not the rightful owners and cannot proceed with the eviction of these people. Negotiations have been worthless. We have offered 30 days to move, plus paying their deposit on a place. That will not consider it. They think if they can get a loan and re-pay us the $20k for taxes, they can have the house. Obviously, this is ridiculous, but they cannot understand it.

My mom feels like these people will destroy the house if she leave to move in with us, so we can't even get her out of there like we intended. We've got to find a way to get these other people out first. After they are gone, we will be changing the locks and installing cameras. Also, her house is 6 hours from where we live, so we don't have a good way to monitor it.

So now we have thought about having her "sell" the house to us for a low price ($10 or something) so that we own it and can proceed with eviction. The problem with this is that the IRS will of course treat it as a gift. Even though we will later be giving her $80k and have already paid $20k in taxes. We don't want to owe gift tax or pay on any gain that is not a true gain. Maybe if we have a separate contract outlining the $80k to be paid later, we can avoid this? Not sure.

Does anyone have a better suggestion on how to get these people out? Or how to avoid an unfair tax bill in the future? We really would rather keep the house under contract while we work on it, rather than purchase it.

Thanks guys!

We have four AirBnB listings and they are SUPER profitable. Way, way more than we would make with a traditional renter. Yes, you are paying utilities, yard work, etc, but we have a house that would maybe rent for $750-$800 and earn over $2,000 on it. However, it is a lot of work, especially because we allow one day bookings and the homes are constantly needing to be cleaned. We've mostly been doing these cleanings ourselves during our lunch breaks, because it's $25/booking and it adds up quickly. But it's getting to be too much work for us and we are looking for a cleaner. However, we will continue to manage our own listings. We have been contacted by a few home owners who have asked us to manage their listings for them and our rate for that is 20%, plus they pay for cleaning. In managing the listing, we respond to inquiries and bookings, set up cleanings/maintenance and make sure they are done properly, track events/busy season and set prices accordingly, do inventory on household items (linens/trash bags/toilet paper/etc) and do the shopping for those items. We also review guests and handle any issues after check-out, like damaged towels/broken dishes/etc.

Garrott Nalle look at this.

Meet with multiple lenders!

I agree with @Deanna McCormick. You'll probably find that you aren't legally allowed to rent your apartment on AirBnB. If you do it anyway and get caught, you could face hefty fines or eviction, or at the very least, they will begin to monitor you in the future and make it difficult for you to continue with AirBnB. If it would be a burden to you to pay the rent on your own, it's not a good idea. 

I think if the student population is that big you don't need to worry about the possibility of alienating others. Sounds like you can easily get it rented out. Are the yards/parking areas all shared, or will everyone have their own space? 

You may even be able to find an experienced property manager that would live in the main house and take care of the back units for a small rent reduction. Depending on where you are, those units might do really well on AirBnB. Where I live, my AirBnB properties cash flow more than double traditional rentals.