All Forum Posts by: Courtney M.

I have bought from the MLS. But, I live in CA and purchased in MI. Sometimes you need to move to a different market to meet your goals.

I bought a pretty standard property last year but my goal this year or next year is to get a rehab property. I really want to ability to "recycle" my cash and create value in the process.

Do you plan on managing this yourself, or bringing in a PM? That would be one of the first things I would look for, if you're not close to your property. I would get quotes for any rehab project. As a few people mentioned, there is less competition and rehabs are going to be more expensive in northern Michigan. 

I personally love Charlevoix/Petoskey and you may want to look near Lake Leelanau (Sutton's Bay). That's another charming area.

Overall this is also an area I looked into, but I thought the ask prices were fairly inflated in the fall of last year. Maybe they've come down a bit. Of course if this isn't going to be solely a rental, you may be okay with paying a bit more so you can enjoy it yourself.

@Nicholas Aiola

Thank you!

Hi @Nicholas Aiola - this is my first time filing taxes with a rental property, so this is probably a pretty basic question.

One of the questions asked is regarding depreciation of an asset and separating the cost of the building and the land. For the property in question, it's a single-family home and I can't find anything in the appraisal, closing statement, or mortgage docs that delineates the value of the land and the value of the house, separately.

Does the IRS accept a standard calculation here? Or is this question really meant for commercial properties where the land use may be larger and more clearly outlined?

@Chanelle Nieto The market doesn't fit my criteria from an investment/cashflow standpoint but everyone has different investing priorities.

You have to be careful in Lake Elsinore. Contrary to popular assumption, the area by the lake is NOT desirable (just Google Lake Elsinore, there are always water issues). The nicer areas are typically referred to as Canyon Hills and are mainly new builder communities and part of an HOA. So be aware of those fees.

I personally do not invest here because I don't see real cashflow opportunities. Even the undesirable areas are pretty high and you may be buying next to poor neighbors. I would definitely look at whatever you intend to buy and get a good understanding of the taxes and how those will affect your bottom line.

There's also a few mobile home parks in the same area and around the lake...so sure, you could pop up a few but you're competing with existing neighborhoods, one of which is pretty nice (I think it's called Butterfield or something similar)?

What is that guy smoking that he thinks he can get $400k for his property? I live in Lake Elsinore and moved into a brand-new house for $420,000 that needed no rehab whatsoever. I personally wouldn't invest in Lake Elsinore, I don't think it's on the upswing and it's not seeing increased development like other areas like Menifee. Plus there are still builder communities building new houses and you'd be competing with those if you're trying to sell the property.

This would be a hard pass for me, even at $200k, since rehab seems like it would be extensive.

Hi Kyle! Welcome to BP! 

Is it possible to take a loan from your plan? I don't know the rules once you are no longer employed with a company but I know 401k plans often do allow loans and variable terms for payback.

I think there is a quantity and total limit - like you can only take out 1 $50,000 loan at a time from your plan, maybe over the course of a year.

Checkbook IRAs are a thing - but keep in mind all the profits must remain within your retirement account.

Personally, with such a low cashflow number, I don't think I'd take a loan or the tax hit. I would consider it for a rehab project where I'm able to pay the loan back fairly quickly.