All Forum Posts by: Daniel Kern

Landlords in NJ are required to have their rental properties built prior to 1978 inspected for lead based paint  by July 22, 2024 per a Phil Murphy signed law in 2021.  Just reaching out to my fellow NJ landlords to see who people are using for this inspection, prices, recommendations, etc. prior to scheduling my properties. Thanks in advance to anyone who has any information.

I created an LLC when we purchased our first rental a few years back. Im in the state of NJ and did not use a lawyer to create the LLC. I was able to do the process on my own. Im not an attorney so this is not legal advice, simply telling you that I started and maintain an LLC and did not consult a lawyer to create. One thing I learned, however, was when I purchased a property and took title in my LLC while using seller financing, it became difficult to find a mortgage company who would refinance the loan into conventional loan in the LLC. I had to transfer title to my personal name using a lawyer, refinance, then transfer title back to the LLC. Just something to think about ... best of luck!

Hello, we got a duplex under contract in November. We have been told by our realtor they think they should have sold for more. The home is a preforclosure and I guess after doing the math the owners weren't going to walk away with as much as they would like. We have been unable to get an inspection on the property due to the current owner and the downstairs tenant being difficult. We contacted an attorney who sent a letter to no avail (but charged $750) and after several attempts to schedule an inspection there always seems to be an issue. Their realtor blames the tenant, tenant blames the owner, etc. Has anyone successfully worked through anything similar? Since November, we have lost out on monthly cash flow and rates have jumped a point and I feel like were in a stalemate. We have 5k EMD in escrow but I still want the home and may also want it vacant due to these issues.

What part of NJ are you from?

@Colleen F.yes it’s nj near ocean city. Septic will be expensive and I took that into account.  The size of the rooms, bc it’s a motel, may not offer the size needed for a kitchenette so I’m struggling. I love the location but don’t wanna run a motel. 

@Colleen F. thank you for the feedback. It is currently operating as a nightly motel with the current owners living on property in a duplex unit included in the sale. These are your traditional motel units without a kitchen. Just queen sized beds, a bathroom, microwave and mini fridge. The location and proximity to the beach is the draw for me. It's just outside a family resort town so there would be a cost savings to families traveling here. I have a full time job already and am not interested in running a motel but the STR is intriguing me. Maybe rehab and add some kitchenettes and look to set minimum nights as suggested. Great call on the septic! Even without me including in the post you're spot on that it would need replacement or rehab based on conversation with current owner.

Hello again all,

Looking to jump into bigger multi family. So far we have a couple triplexes, a duplex, and some sfh.  Ideally, and where we're at financially, I'm thinking 10-50 units would be a sweet spot where we're not competing with the bigger players, smaller investors, or families looking for homes. I came across a motel in the area that is currently operated only seasonally (mid may-sept). Its just outside a family beach resort and Ive been racking my brain on how I can operate the building either seasonally or short term and still utilize property management without operating as a motel where I have to be available 24/7.  There is currently no heat in the rooms and the water line runs on the outside of the building which is why I assume they are seasonal in addition to the travelers to the area all summer. Anyone have any experience in something similar or ideas to buy and operate the 15 rooms without needing to change zoning from commercial or selling rooms by the night?   Thanks in advance.

Thank you all for the tips and advice, much better than what I got ...

I think its best for me to get a second opinion once things slow down a bit and Ill look into the books suggested. All of our properties are currently financed and we sit around 1.5%-1.8% so I am NOT complaining about the cash flow monthly in any way. Just need to figure out what to do moving forward to be closer to 0 April 15, 2022.  I can purchase additional properties that wont cash flow as well, but I dont buy on projected appreciation (at this time). Im thinking pay more into a retirement fund is an option as well, but real estate IMO is my retirement fund in addition to our Roth and pensions, were in education full time

We've only owned the properties up to 5 years now. 
"That and the fact you're in NJ" - 100% accurate, paying the NJ piper (again)

Hello, We just got our taxes back from our accountant and again have a sizeable payment to make to both the state of NJ and Federal Government. We currently own 9 units which all cash flow well. What can or should I be doing to reduce the payments Im making in taxes each April for the past couple years? I read a lot about how real estate offers tax benefits, but maybe Im missing something (or need  a new accountant?) Any advice to prepare for my 2021 return? When I asked my accountant response was 
"do a lousier job of renting and managing the properties"   Thank you in advance.