All Forum Posts by: Jay Thomas

How do you know if IRS tags you as a dealer. Every information out there is only talking about the differences between a dealer and investor. No one is really talking about the actual process. How do you know your current IRS designation? I usually do my own taxes on TurboxTax and I have never come across this IRS designation while my filing taxes.

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Quote from @Chris John:

Quote from @Jay Thomas:

As a high school teacher, I can assure you that it's absolutely DRILLED into these kids that they have to go to college, just cuz. The most vulnerable (broken homes, lack of leadership at home, poor, etc.) are the most likely to be "sold" on college, in my anecdotal experience.

And don't kid yourself, they are absolutely being sold. My daughter received mailers from every college across this land. Most I've never heard of. Were they just trying to be helpful and educate my daughter for me? I think not. They were definitely trying to line their pockets with their excessively fancy and expensive mailers.

So, you take a marginally intelligent, but hardworking kid with no leadership, have his teachers tell them they need to go to college, they receive attention and a fancy mailer from salesmen, and it's a recipe for disaster. To top it off, the professor of some meaningless area of study really goes into overdrive on the sales as they need people at the bottom of their pyramid scheme. "Study what you love" even if they have the only paying job in the field (being a college professor). Kid borrows a fortune and ends up with a ridiculous degree, having been assured that they're doing the right thing the entire way. The college churns out dozens a year, but it keeps the professor employed. It's disgusting.

Having said that, lots of colleges turn out doctors, engineers, etc. That's good. Lots of parents (or other role models) help these kids make good decisions, go to state school, etc. Whatever. That's good.

Throwing an ambitious, people pleasing 18 year old to the wolves of college administrators and recruiters, having the government supplement an endless supply of guaranteed loans, which keeps inflating the price of college for everyone else, etc. That's not good.

Why is college so expensive? Why do college presidents and professors make so much? Why are endowments in the billions? It's all for the kids?

What else can you buy that they don't tell you the price until you've told them how much your parents make (whether or not they will help you out or not)? There's a lot of issues with the college system right now (and it's not caused by a free market).

Rant over. Sorry if anybody read this far! haha.

@Chris John A salesperson's job is to sell and it is the buyer's responsibility to do a due diligence. College education is one of the best financial investment one can make, however, look before you leap.

1 Vote

@Bruce Woodruff. Why do you think everyone has to accumulate huge debt to go to college? There are so many options out there to get a free college education or at a very reduced cost. It really speaks of the person's decision making skill if they accumulate 100K debt on a worthless degree. It is not the job of a university to pick a degree for you. You choose and they educate. If you choose to spend 100k on a degree that will only earn you 30k/year, whose fault is that?

2 Votes

@Joseph A Henke If you cant qualify for a bank loan now, you will probably run into the same issue with HELOC. Try looking into Non-QM loan or Hard money lenders.

Are you planning on doing any value-add to those 50K properties? Lenders don't like small loans. You may need to bundle multiple properties into a single loan.

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Chicago, Illinois

For all the flippers and rental property owners out there with a GC license, how did you do it?

Did you open a new LLC for the GC business?

If you created a new LLC for the GC license, do you add overhead to work performed on your own properties? How did you determine the rate?

If you are the only employee of the GC company, do you still need a Workman Comp?

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Chicago, Illinois

@Colleen F. When I look at Section 8 properties in Chicagoland, they are all concentrated C and below areas. I was hoping to provide a good housing for a low income family in a better area but it is not making financial sense for landlords in B and above areas.....

1 Vote

I am currently considering renting my rental property to a section 8 tenant but the problem is that the market rent is about $300 higher the HUD Fair Market Rent. The property is located in suburban cook county. Since it's outside city of Chicago, it is not part of the mobility area. I don't understand where HUD got their values. Is it possibly to rent to a section 8 tenant without lowering my rent?

1 Vote

Originally posted by @Lucas Martinez:

@Toby Khan in my market, where a condo is over $1mm, that wouldn't be all that feasible. My attorneys advised me that having 1 LLC to hold multiple properties is fine so long as you have a very robust insurance policy.

$1million equity, not purchase price.

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Originally posted by @Greg M.:

Originally posted by @Jay Thomas:

They don't. If they actually jumped in value, then you would have white people being hired by blacks to pretend to be the owner when selling the homes. What you have is a few cases where the appraisal done by a different person was higher when a white person pretended to be the owner. This is an estimate of value, not actual value, and it is extremely subjective. Additionally, there is no proof of the difference being due to racism.

Maybe one appraiser liked the view more than the other one? Maybe one added value for the new foundation and retaining wall that was done, while the other felt it added zero value? Maybe one used a comp that had an outdoor kitchen and the other one didn't? Maybe one used old comps and the other used freshly closed comps? Maybe one saw the driveway with a car parked in it covering the major cracks and the other didn't?

Between sales and refis there are probably 10+ million appraisals each year. There are awesome appraisers and lousy appraisers. Appraisal is an art, not a science. There are going to be outliners. That doesn't mean they're racist. I know you got your pitchfork sharpened and your torch lit, but perhaps you should wait for proof before condemning a person as racist. One day the accused might just be you!

@Greg M.

You dismissed Redfin report about how black neighborhoods are valued less than "similar homes" in white neighborhoods. You claimed they tweaked the data. Redfin must be another race baiting real estate company.

You dismissed cases where black home values increased when a white person pretends to be the owner. You claimed those were just some outliers and there is no proof of the difference being due to racism.

In an earlier post, @Mala S. talked about how she (East Indian) is been treated differently from her husband (Irish/Italian). You are probably going to dismiss this claim as well. I bet you believe Redlining and blockbusting also have nothing to do with race, there is just more demand for whiteness.

It is hard to see a problem that you have never been subjected to. I don't think there is any point in shedding more light on this issue as you have clearly expressed your stance.

1 Vote

Originally posted by @Greg M.:

Originally posted by @Jay Thomas:

Originally posted by @Greg M.:

I'm sorry, but that is such a bulls**t article. They tweaked the data for "fundamental factors that contribute to a home’s value, such as size, condition, neighborhood amenities and schools". First off, anyone who has ever taken a statistics class knows how easily you can get the answer you want by cherry picking and assigning weights to select data. Secondly, they failed to mention one big factor that contributes to the price. DEMAND. There is significantly more demand from people who want to live in a so-called "white areas" than people who want to live in "black areas".

If black areas really are so dramatically undervalued like this article makes the claim, why aren't investment firms buying up thousands of homes in these areas and just waiting for prices to increase?

The saddest thing about journalism today is that the outcome is chosen and the facts are selected to support the outcome regardless of whether it is accurate or not. I could easily use the same numbers and instead of claiming that blacks are deprived of wealth creation because of lower home values, I could spin it positively and claim that it is wonderful that blacks are closer to homeownership than whites thanks to the lower entry costs. It's all how you want to spin it.

@Greg M,
I get it, you already made up your mind and nothing can open your mind to the outside world. People are crying for help and all you can do is gaslight them.

No Jay, I expect people to analyze things from multiple objective perspectives and come up with a conclusion based on facts, not emotions or hopes, not like you who has made up their mind and refuses to accept other possibilities.

This article cherry picked data elements and weighted them and then left out the data element that has the biggest overall affect on price.

Explain this, a house is listed for sale and sells for X. Someone somewhere claims that this was $48,000 undervalued. Then why didn't the market force up the selling price to the correct level? Are you going to pretend that there is an inefficient market regarding house sales in black areas?

The fact that the "same house" in a black area sells for less than in a white area is because there is less demand for it. A snow cone sells for less in Alaska than in Texas because there is less demand for it. I'd say that is an efficient market You'd say that snow cones are racist.

@Greg M,

Why do houses (owned by black people) jump in value when a white person pretends to be the owner? There have been multiple cases of this reported. You can do the research yourself.

Also while doing your research, I will like you to look into the areas you called "black areas". When these areas were created, were they allowed in the place you called "white areas".

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All Forum Posts by: Jay Thomas

Jay Thomas has started 31 posts and replied 132 times.

Post: Real Estate Dealer vs Investor

Post: What to major in College for RE investing?

Post: What to major in College for RE investing?

Post: Buying Houses Cash then using a HELOCs to buy More

Post: Real Estate investors with GC License

Post: Section 8 tenant in a high rent area

Post: Section 8 tenant in a high rent area

Post: How many properties in one LLC

Post: Avoiding Bias. How do other investors do it?

Post: Avoiding Bias. How do other investors do it?