All Forum Posts by: Grant Berthold

Yes, Chris Hicks with Hicks Tax and Accounting is an experienced real estate investor and CPA. I've worked with him the last few years, and he is very knowledgeable. He's up in Ames, not sure if you want to drive that far, but I would say it's definitely worth it!

http://www.hickstax.com/services.html

I self-manage my properties in Ames, but this is what know of property management in Ames, IA:

1. For a single family residence, you'll be looking at about 10% of Gross rents for a management fee in the Ames area, especially for a single family. Multi-units properties may be able to negotiate to 8-9%

2. The 10% usually covers leasing/management, Repairs/cleaning between tenants are usually billed to you separately.

3. You could possibly take of getting the place leased yourself (via craigslist, zillow, etc) and negotiate a little bit better management rate. If you're able to visit the property periodically, you may be able to check on things/do repairs yourself if you're handy. 

Feel free to PM me if you have any other questions about the Ames market!

My rental agreement does not discuss this specifically. It basically states that damages will be taken from the deposit. I think I agree with you all, it should be taken out of the deposit as a whole, and let the tenants deal with who gets what back, especially considering I have language in there stating they are all responsible for the whole rent amount and not just "their portion". I guess I was just questioning it in this case because it was clearly one tenant who did it. Thanks guys!

I have a unit where 3 people are on the same lease, and there was damage in one of the tenant's bedrooms. I know which tenant caused the damage, as it was caused by their furniture rubbing back and forth in a certain spot.

Each of the tenants gave me a portion of the security deposit.  My question is: when returning the security deposit, do I charge each tenant a portion of the damage? Or just take it out of the deposit of the tenant whose furniture caused the damage?

Thanks for your help!

You would have to pay Short Term Capital Gains since it's under 1 year. 

Wow!! That's really inspiring! I'm someone who likes to try to run everything, and I've been realizing lately that in order to grow, I'm going to need to start delegating a lot of the smaller tasks and specialize what I do.  Keep up the awesome work!

Yes you do pay taxes on that rental income. You also can deduct the expenses and repairs, and depreciate the side of the duplex that is being rented out. It can get a little tricky though - I was in the same scenario a couple years ago, and I'd recommend getting a cpa who specializes in real estate to do your taxes. 

I wouldn't be able to help you with the contract part of it. Personally I would just go to a local attorney who specializes in real estate transactions. They'll have an owner financing contract. 

Before that however, you'll need to figure out the taxes, insurance, estimated repairs, vacancy rate, and any upfront capital improvements needed to get a better understanding of the full financial picture of this property. Just looking at the Rent/Purchase Price ratio, it doesn't look like a good deal, unless the house is worth way more than $400K and you're in a growing/appreciating market. Even with interest-only financing at 5% interest, you'd still probably be over $2000/month before repairs/maintenance. 

Invest in learning about real estate. All the different fields in real estate are quite profitable for the people who are the best at them. While I have nowhere near the net worth she does, I know the temptation to stop looking for amazing deals can creep in once you have a little bit of money. Single family, multi-family, and commercial properties all have great potential to be very profitable, but you need to know your market(s), and the real estate business extremely well in order to be highly profitable. 

The people who make profits with no money are the ones who found an amazing deal. Once you have an amazing deal, finding someone to finance it is much easier. You already have the financing lined up, now go out and find some awesome deals and become an expert in the field you choose! Maybe not exactly the answer you were hoping for, but I hope it helps. Good luck!

Sounds like a decent idea! I look back on my college years and wish I had the state of mind to purchase a house and rent out the bedrooms to my roommates. However, I would recommend renting there for a semester, and spend a lot of time driving the neighborhoods and studying the market. Try to find a real estate agent who's also an investor and get their take on the housing situation. Good luck!