All Forum Posts by: Lynn Z

I can't really find any definitive answers with regards to 1031 exchange holding period regarding continuing to reinvest. The IRS clearly doesn't want you to do an exchange and sell the property. My CPA and my former National Tax Service accountant with years of experience (also has real estate broker's license) says you can sell the relinquished property in less than a year as long as the equity is "continued" in another like kind deal. CPA said he has clients that reinvest in a shorter period than what I"m talking about.

All of the money must be continued in the next 1031 exchange and it will be spread over two tax years so I may just plan to do that. Both say I'm not in the danger zone of being cast as a "dealer".

I'd have to hold one year and a day at least I understand if I did move in it as a residence and hold for five years to get tax free gain.

I also know you do not have to rent the replacement property. Also, there is some discussion that the hold period for the relinquished property was 7 years. That could make a difference too.

If anyone has any experience in this holding period mess I"d appreciate their input.

Thanks, I've seen them for years. People stopped using them in our area several years back. I think they look great but even a ranch redo they want the slabs. Also, apartment conversions and condos, same thing.

My goal for 2007 is to brow beat my painter into fixing that awful spray paint job he did yesterday on my new rehabbed kitchen cabinets, finish the bathroom in the same house (at the stud level) and FSBO my 3/2 project by the spring market. Hopefully after the house sells then roll over the investment into another 1031 exchange and pray that my attorney will do another exchange--which he hates. Like a good investor, I am prepared to hold the house for the Congressionally approved 5 years and live in the house the last two years to receive favorable tax treatment should all of the above fail --praying all the while for a decent tenant who could actually take care of a freshly rehabbed house AND change filters AND cut the grass. IS IT ASKING TOO MUCH?

check out Fannie Mae Desktop Underwriter guidelines. You can basically read about the qualifying ratios that the banks/lenders follow. Always helps me.

I was advised by a high priced tax attorney to set up llc's in accordance with the property type. Perhaps several old "girls" together, a new house separate--more by function than anything else. My real estate club had a lawyer speak to us recently and his opinion is when they sue, they're going sue you individually no matter how the property is structured.

You might want to put in your leases that moving furniture by tenant and guests (that includes parents) are at their "own risk". If they fall lugging some antique and break something...they look to your insurance to pay medical bills no matter whether they were too cheap and stupid to try and haul furniture they couldn't manage without injury. This did happen to us. It's a nightmare. Get liability insurance (umbrella policy). Talk to a good agent.

LoanOfficer650: I do suggest that you look at Quicken Rent Manager to help you keep up with every expense when managing your property. Without some tool to keep up with costs (eg. tools, supplies, mileage, smoke detectors, yardmen etc) you will never know what the total number is. After loading everything in for a year, it's a lot less I would have imagined. I'm sure there are other software that's just as good, but this one is reasonable and easy to use.

Appreciation in my area is more like 5-7% over the past five years. That 20-30% appreciation just isn't up for consideration here.

we have to post notice also in S.C. but we can't garnish wages so no matter what damages you might seek, they know their paycheck is protected. By the time someone is evicted they don't care if they have a judgment against them. All you can do is have that eviction to show up on their record so iif they do ever want a nice reference no one has to rent to them. Another reason to run good credit checks and references.

States are so different. I read in the newspaper recently that in N.Y. the house is considered owned by the mortgage holder and it takes two years to foreclose but in California the mortgage holder is considered the "owner" and it doesn't take anytime to foreclose. The N.Y. owner has much more time to catch up payments, sell the house, etc. than the California owner.

I lived in Tennessee one time and made a direct payment to the owner's mailbox each month. Well, when he got his accounting messed up he just published in a ragsheet that he was foreclosing and we had to hire a lawyer to tackle that problem Luckily had the canceled checks and someone happened to see the publication. You do have to be careful.

some states require lawyers to be licensed by their state and if not they have to be "invited in" by licensed lawyers.

I wouldn't buy out of state if I couldn't see the property. I'm assuming you would do so. Make sure whatever lawyer you use that they specialize in real estate. Get a a good one to look everything over. Get that disclosure statement before entering into any contract.

I have never understood "seasoning". Is this just to discourage flipping?

I have held a small house for two months to get a great couple who stayed three years. It was winter and I was pretty desperate but want someone that will take care of the house. They needed to give notice (there's 30 days right there). Most landlords do hate vacancies and would like to know that they have a viable tenant even if they have to wait.

Sometimes a month's rent can be split between the two parties so that the landlord doesn't absorb the lost rent waiting on a tenant.

We have taken security deposits from family members of international business students studying abroad in the summer who never see the apartment but view digitals posted on Craig's list or by visiting family members who email the photos. Ask for digitals. A lot of landlords have them due to documentation of apartments for clean/unclean conditions.