All Forum Posts by: Christian Carson

Heavy rainfall events in Northern Ohio are up 37% over 50 years. This is much of the reason why Lake Erie sees bigger and bigger algae blooms every year (due in part to farm runoff from NW Ohio and overflow of the environmental disaster that is the Detroit sewer system). This is more part and parcel to the effects of "climate change" than simple changes in average temperature during a given year.

Those who know me well know I have a bone to pick with cities built in deserts (read: the southwest). Heavy water use there results in higher evaporation of fresh water and runoff to streams and rivers, which eventually ends up in the ocean. At some point the future, desalination might become a very cheap option, but not quite yet--as of now it's being supported by (Midwestern) federal tax dollars going to public works, which make the place livable.

@Steve Dearing

People prefer replacement value because ACV doesn't typically pay out enough to make repairs if you have a partial loss. Often, the premium isn't much more for replacement value.

You're right. Ohio law requires foreign business entities to register with the SoS in order to hold property or avail itself of the courts of this state.

As for choice of state: if your LLC gets sued by a third party, chances are high you'll be in Ohio courts interpreting Ohio law anyway. Delaware law will benefit you when there is an internal dispute between members, or when the third party suing you happens to be a Delaware corporation (and then, after much trouble, you can request a change of venue to Delaware if you were not actually sued there in the first place). For the most part, however, Delaware's court excel in interpreting their rich corporate code, so corporate types prefer to be in their courts for shareholder disputes because there is a low chance that the judge will drop the ball on interpreting corporate charters or operating agreements or the like.

When you buy an LLC from someone else, you inherit that LLC's legal history as well. If that LLC has done any other business, I would avoid buying it, especially if it has held property in the past. A lawsuit from years ago could come back to haunt you, and it'll be on you to fix it because you're now the manager of the LLC.

When it comes to mold, generally you have to replace all tainted drywall and any wood that shows rot (looks black like it's been in a fire). Just spraying Kilz everywhere is not going to cut it, as the mold can thrive even when encased. It's not rocket science up here -- just remove everything and replace. The people from southern climates have a lot more mold to contend with, so mold remediation is a much bigger business than it is here.

In this thread: People investing in markets too expensive for the 2% rule.

It's a stretch to say that this place is anything like Detroit, and a sore point for most locals. Many of our inner-city neighborhoods have been undergoing sustained gentrification for over twenty years, and since 2007, we've seen redevelopment spill out into the adjoining neighborhoods in a big way. Near west side neighborhoods like Ohio City and Tremont are epicenters of such redevelopment.

@Tim Uittenbroek , welcome to Biggerpockets! I was just in Singapore for an extended layover at the beginning of this month...I definitely got a good laugh out of the real estate pitch on the airport city tour!

Good luck vetting the investment opportunities. Analysis paralysis is not a bad thing if it involves investigating the character of your potential business partners.

I'm not certain of the mechanics of the auditor's office now that there has been a change in structure, but generally we make assumptions of taxes based on the purchase price or the current tax assessment, whichever is higher. You can revalue taxes lower if the purchase price is below the assessment but it may not save you 100% of your overpayments.

If you're in 44106 (in the Heights, not city proper), then 5% vacancy is even too conservative. I've seen buildings with a demonstrable <2% vacancy over five years. But if you're in 44118/44121 then much higher vacancy is appropriate.

The caveats to these buildings are off-street parking (there is a citywide overnight on-street parking ban which will cause your units to turn over quickly) and landlord-provided heat through old boiler systems. I wouldn't buy a building without adequate off-street parking or a very close city parking lot. Also make sure your seller is including an adequate number of parking passes, as they're very hard to get from the city. 

Also, your tax assumption is low. More like $9700 based on your purchase price. See http://fiscalofficer.cuyahogacounty.us/en-US/property-tax-calculator.aspx 

Welcome to the site, Carlos!