All Forum Posts by: Henry Murray

@Peter Eberhardt Good point, thank you!  I haven't heard anyone talking about special assessments in the reading I've done so far about LA country so I don't know anything about them here but I should look into that more. How have you been accounting for that in Kern count so far? Are they consistent year to year so you'd see it as part of the prior year's tax bill for the property you're looking at (if you're able to pull that info)? 

@Madison Santerre I took a look around that website and wasn't able to find anything with a tax estimator, can you point me to where on their website the estimator is?

Although I think Peter might have pretty muchsolved my problem haha

@Peter Eberhardt

Awesome!! I think that's exactly the right way to do it and exactly what I was looking for! I swear I'd googled this too before I posed the question and didn't find anything more informative haha, so I appreciate you sharing what you found!  The tax rate area number lookup is similar to what I'd found in South Carolina when I was really looking into this last.  

So to confirm my understanding then, the Supplemental Tax bill is basically just the difference between the assessed value of the prior owner and my new assessed value (ie my purchase price) * the tax rate I looked up on the auditor's website * a pro-rating based on when I bought the property during the year, right?

From reading about it a little bit online it looks like supplemental tax bills were introduced in 1983 when California decided that changes in taxes due to changes in assessed value must be paid on the first date of the next month after a reassessment event (ie a property sale) instead of on the next annual tax bill.  So I think my understanding ^ is pretty accurate.  Link for anyone who's interested: https://assessor.saccounty.net...

Hi BP! So I’ve tried several avenues already and I’m actually shocked I haven’t been able to find this info anywhere yet, so I’m turning to the trusty BP community.  (Disclaimer: I’m not asking for tax advice, just for someone to point me to an official source.  Hopefully from LA county or city websites)

Does anybody know how to estimate (calculate) what my tax bill will be for a particular property that I’m looking at making an offer on in LA county? How do you estimate/account for taxes in your deals in LA county or is there a common way to do it?

So far I’ve:

• 1) Looked a prior tax history for the property.  However, because of Prop 13 the seller’s tax basis could be MUCH lower than the sale price and my taxes would jump up when the property was sold and the tax basis was reassessed so I’m not sure how much the tax history tells me.   
• 2) Looked all over the Assessor’s website for a property tax calculator and come up empty.  Other counties (outside of CA) have online calculators where you can input the address, if it’s a primary residence, the new sale value, etc and it’ll tell you almost exactly what tax bill to expect.
• 3) Asked my friend who recently bought a condo here in the south bay.  He told me he honestly didn’t know exactly what his property tax bill would be before making the offer and closing and he didn't know how to estimate it either.
• 4) Asked a real estate agent who I recently started talking to.  She’s been in the business for 10 years but didn’t know either and also didn’t know of anywhere I could find that info.  She did tell me that it varies between cities in LA county and off the top of her head, told me to estimate 1.5% of the purchase price.

I saw on forums/online somewhere a while ago that 1.25% is a good ballpark but I’d really rather have a more official source.  A $2k difference in yearly taxes (the difference between 1.25% vs 1.5% on a $800k property) would have a significant effect on my cash flow that I’d like to understand when I’m running numbers on potential deals. 

Thanks for your help or any sources you can point me to!

That looks like a great group @Jon Schwartz. Thanks for the link! I'm planning to attend their virtual meeting next week and looking forward to when it's safe to start meeting in person again!

Hey @Troy Gandee! Hope you're doing well man! I can't believe I didn't see your post here till just now...  Thanks for the info and background perspective! That's a really good idea to start with 6 months and then extend from there.  I definitely see their perspective since it's a large up front investment to find and place a good tenant that they need to make up on the back end for the rest of the contract, it was just a little intimidating going into a pretty binding year long contract without having that personal experience with them first to know how it would go.  But at the end of the day it's been almost 9 months now and the PM company has been absolutely great so I think my worry in this case was unfounded and is (thankfully!) moot at this point anyway! 

Hi BP!! So glad to be back on here after a little bit of a break! I did a bit of searching in the forums and members but wasn’t able to find anything yet so figured I’d post a question.

Is anyone able to recommend a good real estate meet up or REI group that covers the South Bay & West LA areas now that in person events are starting up again? I was hoping to find a group that was more focused on networking and people making connections with each other than paying to hear a pitch so any recommendations are appreciated!

I moved back to SoCal last summer for a new position at work and I'm now looking to buy a small multifamily (2-4 units) to live in and rent out the reminder of the units and rooms. I'm targeting the South Bay or West LA areas and am looking to get to know others in the REI community there and to learn more about the neighborhoods along the way.

I'm in the final stages of selecting a Property Manager and they have several "Performance Guarantee" that they sent me in a pamphlet (things like "We only get paid when a tenant pays", "If the tenant we place in the property gets evicted within the first 12 months, we will refund the leasing fee", and "If you are not happy with our service, you can cancel anytime with a 60-day notice").  Some of these I can find in the PM contract they sent me to sign (the we only get paid when the tenant pays), but the other two aren't explicitly written into the contract. 

There also is a section in the PM contract about the "Entire and Binding Agreement" that says that "Parties agree that this Contract expresses the entire agreement between the parties, that there is no other agreement, oral/otherwise, modifying the terms and this Contract is binding on Parties and principals, heirs, personal representatives, successors, and assigns. Illegal provisions are severable."  This section seems pretty typical from what I've seen but seems like it would exclude the additional Performance Guarantees they sent me since they're not referenced anywhere I can find in the PM contract?

How does this typically work? Are PM guarantees typically explicitly written into the management agreement (or the additional document referenced somewhere in the management agreement) or are they typically offered as a business policy that the business will offer on their goodwill but not written into the contract with homeowners? 

I've seen it both ways now and this company has really good reviews so maybe I'm just over thinking the details here but I want to get an idea of what is standard practice.  What has anyone else seen? 

@Adam Martin thanks for your perspective! They seemed like a really reputable company from everything I could find online about them and they seem really willing to work with me here to get my business so I think I'm going to see if we can reach a common understanding. Like I mentioned above they have a performance guarantee section that I can cancel with 60 days notice if "im not happy with their services" but thats also only if they mess up and can't make something right for me. I wanted it mentioned in the actual contract we sign as well since there's another section in the management agreement that says something to the effect of "this is the entire agreement there are no other written or verbal understandings that shall apply".

@Will Gaston thanks for your thoughts! I definitely understand that they want to protect themselves and like you mentioned churn isn't good for their business. That's a very good point too about using this to see how the relationship will go. I talked to them yesterday and it seemed like they understood my concerns and were really willing to work with me and said they'd looking into revising the contract but he'd need to talk to the broker and then their attorney.

They also have a "performance guarantee" where if they do something wrong and can't make it right I could cancel the contract with no fees with 60 days notice, but thats not mentioned in the actual management agreement that we'd sign and also kind of subjective. At the very least I learned that they don't offer renewal to a tenant without my approval so I'd be able to make the decision if I want to stay with them at that point and just not renew the contract if I wanted to move PMs after a year without penalty.