All Forum Posts by: Dave G.

@Austin Paulenske I have never heard of assessed value ratio. If this is for calculating annual depreciation, my CPA uses my HUD statement from closing to determine the cost basis of the property, including a decrement for the value of the land since that is not depreciable. Then that value is divided by 27.5 to calculate the annual depreciation value. Not sure this is helpful to you at all.

I did my own taxes for years until I bought my first rental. With that, Turbo Tax didn't cut it for me anymore and I found a CPA to do them and believe the expense of a professional is well-worth it, especially as my portfolio grew. 

If "news about famous people" = industry leaders such as Warren Buffet or Elon Musk, then ok. 

If it's about singers and movie stars, they are 99.9% irrelevant. They don't live in the real world and should be ignored. 

Spend less than what you earn.

In AZ it is 48 hour min notice for inspection and has nothing to do with whether the property is for sale or not. Tenant does not get a vote on if it is going to happen. PM should just be trying to get a mutually agreed upon day/time for the inspection. If tenant denies it, commence the eviction process as they are in breach of statutory law.

@Abdul Azeez To me this requires some face-to-face time with the PM and an in-person inspection of the property. Are you working with a local realtor on the sale? Maybe you could employ them to do this? Or do you have some other delegate or associate near the property that you can task this with? To get the real story on what's going on, you or a trusted & competent associate needs to be boots on the ground fast. Travel expense for such a trip would be part of my annual budget for an out-of-state rental. Are PMs in TN required to have real estate licenses? If so, filing a complaint against the PM may be another path of escalation after you get better intel on the situation.

Good luck to you

@Sam Zawatsky there are really no wrong answers here, but I would just warn on being too aggressive. Take it from someone that lost properties due to that (my first 3 rentals, when I was 21 years old, a long time ago). You don't want to scale too fast or get too leveraged. Are we going to have another market correction like in 2009, who knows? But if you had property in FL, AZ and NV and your LTV was 50% or more before it hit, your LTV just went to 100% or worse and that quickly dries up options on reacting to such a market....or survival.

You look like a young guy, you've got a lot of runway in front of you. Maybe you don't need to pull out $$ and increase your interest rate for $26k. Maybe you can just save that this year. Or in two years. This is a get-rich slow game. A marathon in my opinion, hence my conservative recommendation.

Good luck to you.

@Eric James good point. But isn't a seasoning period also potentially a good thing for a newer investor by forcing them to accrue actuals and experience some reality before moving onto the next project?

Like many other posters here, my WHY is a cocktail of reasons: 

I had a high school friend whose dad owned multiple commercial buildings and was fairly wealthy. When I was 21 years old, he took me for a ride in his new Ferrari. That was a big influence on me! 

And nobody in my family or my wife's family had ever invested in RE before, so that drove me to be different and explore it. 

My wife and I both had solid professional careers in aerospace, and I wanted a different asset-class to park some of our money than just the stock market

It is a very imperfect market compared to equities, so you can find discounted investment deals

After-tax cashflow can be amazing with the depreciation deduction

It afforded me the wonderful opportunity to retire comfortably at 55 (in 2021) when my employer decided being woke was more important than I could stomach. 

@Alicia Marks I would get a good look at the plumbing to understand if it is something really old and/or fragile. You wouldn't want to discover big scope-creep when you're doing the fixture replacements and not have it accounted for in the numbers. 

I own a 1915 bungalow which I think still has the original cast iron plumbing so I have reserves set aside in case we have a major failure (fingers crossed). And I've got an old-timer plumber on standby who's worked in this neighborhood for almost 50 years...

Good luck to you.

@Adri Jusczak Your path will be based on your goals and situation. It may also be driven by what opportunities you find. What if you don't find a good 4-plex this year but you find an awesome #3 SFR investment? A bird-in-the-hand vs two-in-the-bush thing, right?

I am among those that believe RE investing is a marathon, not a sprint. Doubling your doors every year sounds pretty sporty to me. Sounds like you're doing well so far, just don't grow too fast and bite off more than you can chew. Don't get overleveraged, make sure you have accurately-calculated cashflow on all your properties and be smart and deliberate with your acquisitions. 

Good luck to you!