All Forum Posts by: Eugene Lubman

The primary reason is that my parents' risk tolerance is much lower than my own (they are retired and are on fixed income). This property was originally a fixer-upper that I finally brought to a point where it is in good condition, has good tenants and good, predictable cash-flow. That is what my parents need. As for me, I intend to use the money from the sale to buy another fixer-upper.

Hi,

I am planning to sell my 3-unit investment property to my parents.  The idea is to provide them with a steady passive income in their retirement.  I will still be managing the property, as well as be an inheritor, so ideally my name should remain on the title.  The property currently has a mortgage on  it, but it should be paid off during the sale as my parents want to own the property free and clear.  Or is it better to transfer the property to a trust owned by my parents where I will be the beneficiary?  Also, I will probably want to do a 1031 exchange as I am planning to buy another investment property to replace this one.   I will almost certainly need an attorney, but I am not even sure where to begin.  What is the most pain free (and, ideally, tax-free) way to accomplish this?

Here are my initial questions:

1. Should I be looking for a tax attorney, a real estate attorney, or a trust/estate attorney?

2. The property is in Connecticut, I live in Massachusetts and my parents are in New York.  What state should the attorney be licensed in?

3. Given that my parents are elderly, what are the pros and cons of selling it to them vs transferring to a trust?

Thank you.

Gene

Hi all,

I am about to close on my first house hack (4-unit), but the appraisal came in at 7% less than my offer. I am financing with an FHA loan, and the lender will not approve a loan above the appraised value. My agent shared the appraisal report with the seller and is trying to renegotiate the price. If the seller refuses to sell it for the appraised price, what are my options?

Gene

Hi everyone,

I am a newbie investor living in the South Shore area of Massachusetts. My original plan was to buy a four-unit property and rent out three of the four units. I will need to occupy the largest of the units since I need a 3-4 bedroom unit for my family. The best deal that I have been able to find in my local market will only start to cash flow (just barely) after I move out a couple of years from now, but certainly not before: the monthly net income based on the 50% rule is $2050 and the mortgage P+I plus PMI is $3000-32000/mo (depending on the loan). Besides, this will require me to give up the house we are currently renting (which we love) and move to a less desirable town further away from Boston. Is this the best that I can hope for in this market?

The alternative that I am considering is to stay put in our rented house while investing in a multiunit property in a market with a better cash-flow potential (lower price-to-rent ratio).  The closest such market that I have found is the New York Capital District: Albany/Troy/Schenectady.  I have found some properties that should (theoretically) give me a healthy cash flow of $2000/mo or so, again, using the 50% rule.  Is this a better option in my case, or this too risky/complicated for a newbie?  Can I even get a commercial loan in the current climate?

(BTW, I am planning to buy and hold, and I am primarily focusing on cash flow, not on appreciation at this stage.)

Any advice is highly appreciated.