All Forum Posts by: Jimmy Chou

@Kelton Johnson

Have you tried to post the deal at BP Marketplace? 

Maybe there'll be some private money lenders on the site interested in funding your long term note.

@Dave Foster , Thanks for the white paper and all your explanation. It's making a lot more sense to me now. This is such an interesting topic. 

Regarding #1 though, how would an investor demonstrate the intent besides the hold time? What are the other things the auditors commonly look at? Are there any black and white "tests" or is it really just based on what the auditor thinks?

Your reply on #2 and # 3 are such eye opener for me! I've always thought of 1031 as this square box of rules and just now realizing some of these flexibility within. What if the units are different though? Say if I got a 4-Plex and two has 2bd and two has 1bd. I use one of the 1bd for myself. Would I then just split them up based on estimated values?

@Christopher Leon , Check this out...

@Dave Foster, thanks for replying to my post! This is very helpful :)

1. I didn't realize general flips are not eligible for 1031, in that case I need to go through my thought process all over again about this. So, if I were to pivot the strategy of this flip into a BRRRR first and then sell it as a turn-key, would I then be able to 1031 into something else? Is there anywhere I can read up more about why it's not eligible?

2. Got it, so no matter how I structure the paperwork, I simply can't live in something that I 1031 into.

3. This part is a little bit confusing while interesting. So I can house hack on a duplex and then 1031 the other half that I didn't live in? I thought duplex are always bought and sold together and should be considered as 1 property. How does that not break the rule of primary residence? How would one go about dividing that up? And if that's the case then couldn't we somehow reverse the process and 1031 into that duplex in the first place?

Hey BP,

Need some thoughts from everyone about possibly combining these strategies FLIP + 1031 + BRRR. I'm currently renting and working on my first flip project. While flipping is the hot and sexy passion of mine, I do want to also get into house hacking to improve my monthly expenses. So I'm considering using the proceeds of the flip and 1031 in to a Duplex or anything else I can hack. If this all works, after BRRRing the money back out, I should still have enough to fund my next flip. On top of that, I expect to defer quite a bit of taxes from the capital gain of my flip.

There's one big technicalities I'm not quite sure about ...

Per my understanding, 1031 only works for exchanging investment properties and cannot be used for primary residence. The flip property is purchased under my company's name, so if I 1031 into something else, it'll still be under my company's name. Would being the owner of the company living there be considered as using it for primary residence? Or would I be okay since my company and I are two different entities? If that's an issue, would paperwork showing that my company leasing it off to myself be a fix? Or is there any other way to get around this rule like leasing it to a family member?

Has anyone tried to 1031 into a BRRR before?

BTW, shoes at the corner...that's just hilarious...lol

The only reason you hire an agent is for them to market your property effectively. If your realtor doesn't understand the importance of that first touch of how everyone shops for houses at this age, you might want to consider getting another realtor. If they can't take proper pix themselves, the least they should do is work with a professional photographer and give you the option. 

Welcome Jim, good luck with everything.

@Rachel Imhof, I'm not only looking to network with good GCs, I also want to know a few people that are into the niche of spec building. I sent you a private message already. Let me know if you have any good connections :)

Hi Everyone,

I would like to expand my network and get to know a few builders in the area.

Does anyone know any good builders that works around the City of Chicago, North Shore, and the surrounding Suburbs?

Hey Everyone, 

We have some development on this. So after my last post, I have not been able to reach the seller. However, Redfin emailed me a few weeks ago saying the property is on now the market. The place has been rehabbed, and it turns out Buyer #2 closed on the property disregarding my recorded contract entirely. (How!? His attorney/title company malpractice?) Anyways, the place is now under contract again. I spoke to a few fellow investors in the area and an attorney. I also got to meet Buyer #3 at a REIA meeting and had the funniest conversation of all time about the situation. They suggested for me to have an attorney write a mean letter to Buyer #2. The purpose is to make a fuzz about this and perhaps shake him down for a few grand to walk away with before the property closes again.

Buyer #2 doesn't seem to have a good reputation in the area. He's one of the wholesaler that keeps blasting everyone with bad deals. So I'm getting some moral supports from a few fellow investors to go ahead and "shake him down". If I proceed with the letter, my hard cost/investment on the deal will be $400 ($50 recording fee + $350 attorney fee), potential return around $2K~$5K.  On the other hand, I'm not quite sure if this is how I want to do business (chasing after deals that has gone sour and shaking people down). However, due to the uniqueness of the situation, I feel like I should take it as a learning experience and try to pursue and see what happens. 

Please share your thoughts my fellow BP members.