All Forum Posts by: Daniel D.

@Alex Olson yes definitely not trying to 1031 into my new home. Looking to buy 5-7 single families in a different state

Hello,

I currently own one house in Arizona which is my primary residence but also an owner-occupied rental (I rent out 2 rooms).

I began construction on my second house in AZ which will be my primary residence. My original plan was to rent the current house out, but I found a better opportunity back in Michigan where I am from.

Am I eligible for a 1031 exchange if the property is an owner-occupied rental? I can't find any clear information on this. I will be purchasing 5-7 single-family homes in Michigan with the sale of this house. 

I've been in the house ~18 months and won't make it to 2 years since my new home will be done in March which I have to occupy within 60 days of closing...

When I talked to a CPA about this, he wasn't sure. But he recommended I rent the house out briefly and then do a 1031 exchange. Which brings me to the question of what is the minimum time a house must be a rental to qualify for 1031? What if I rent the house for 1-2 months and then sell it?

@Ashish Acharya

My personal annual income is between 100-120 annually. I have no other businesses so no adjustments would be made other than what comes from the rental.

I’m married and I personally own the home and will act as the property manager. Is there any other information you’d like?

By the way, I found my appraisal.

Land = $160,000

Dwelling = $212,625

Garage = $27,860

Hello, I’m going to have my first rental going up in the next 4 months. I should profit $800/mo from this rental. It is a 400k house (not sure land value yet) but I’m wondering if I can depreciate this into a loss and get a tax break on my personal taxes?

800*12 = $9,600/yr

Let’s say I was able to depreciate the house $12,000/year. Would I be able to write off a loss of $2,400 and carry that over to my personal taxes?

@Chris Mason

Thank you for the input. My lender showed me the note from Freddie Mac stating I need either a lease agreement plus appraisal OR a lease agreement plus 2 months of rent proved to be sent to me. Am I missing something?

@Daniel D.

I’d like to add that the tenant has not moved in yet but has sent the security deposit.

Bonus question: can my wife’s new income (only 1 year old) be used if she was previously a home maker? This is another question my lender seems unsure of until it gets processed.

Hello, I’m planning to rent my primary residence and purchase a new home. My lender doesn’t seem sure about my question if my signed lease agreement supersedes the rental appraisal. I’d like to ask some of the pros in here for advice.

My total monthly cost on the house is $1600. The lease agreement is signed at $2500/mo. If my rental appraisal comes in at $2,200/mo, which will they go off?

This is a new build that requires 20k down as good faith money and it will be lost if I'm unable to qualify once the home is finished. I want to be really safe and far under my DTI so that $300 a month would help me sleep better at night

@Charles Kao

Thanks for the insight Charles.

Hello my name is Dan. I’m current living in AZ but I grew up in East Lansing.

I’m looking to start in the GR investment property market.

The first thing I’ve noticed was how old these houses are. This is much different than Arizona. You don’t see much older than the 80’s-90’s here. What would you consider a safe annual repair percentage to hold onto?

Second, the rental laws are different. I decided against East Lansing because their rental and zoning laws are strict and sometimes impossible to get your house approved to rent. How is this process in GR?

The numbers in GR seem almost too good to be true. For example, I saw a $525,000 quad plex that would immediately generate $1,600 a mo above the mortgage at only 10% down. Is there a catch? Who is the main renter market, students or professionals?

I do plan to visit next month and do some due diligence on different areas. I just thought I’d ask here.