All Forum Posts by: John C.

I live in Queens and sold a property in OH and did a 1031 into a property in Brooklyn. You just need a qualified intermediary, not necessarily a CPA. There's a bunch of QE's you can find online. I used IPX1031.com and the transaction was very smooth. They charged me $1,000 in total.

Most hard money lenders I know are charging 2 points, and 10% interest. They usually want you to put some skin in the game, so you might have to put down 10-30% down payment, depending on the deal and your experience. I invest in the NYC area where land values can easily exceed the physical house value, so run down doesn't mean too much. But you should be very weary of NYC's DOB and ECB violations, they can be a headache to deal with.

Hi Jerry,

Nice to meet you. What aspect of real estate law do you practice? I buy/sell properties in Queens/Brooklyn sometimes and need an transactional attorney. Also, I can help you out if you have any questions on finding the returns you're looking for in certain areas of Queens.

I've purchased from foreclosure auctions in Queens before, and the margins arent that wide. In NYC, you're banking on a lot of appreciation. However, in 3 families buildings in some parts of Queens, I can find 6-7% returns. Let me know if you need any help.

I own a few properties in Roselawn and am currently selling off a single family property there. I could probably let you know if you got a good deal or not on your buy. Let me know how many units/bedrooms, price, condition, etc.

Thank you so much for your detailed answer. I'm referring to your 2nd scenario (Bob gets $75k and wants me to write a separate check to Sally for 100k without it showing on the closing statement). 

I didn't think I could add Sally's 100k to my cost basis since it's not on the closing statement and I'm not receiving any benefit from her, but the seller Bob is insisting that since he has proof that the checks Sally wrote to Bob were spent on renovations on the property, that I can factor the 100k check I pay Sally into my cost basis. 

I did ask a separate CPA and they pretty much told me exactly what you told me. Thank you!

Hello everyone,

I'd like your opinions on this one, accountant or non-accountant.

I am about to purchase a stalled construction site. The seller, let's call him Bob, previously received a $100,000 loan from his friend, Sally, in the form of a check from her home equity line of credit to help pay for renovations. These loan checks were written directly to Bob's personal name, and in the memo was the address of the property. The loan was never recorded on the property and is a private loan. 

Now I'm about to purchase this property. At closing, the seller, Bob, wants me to write a $100,000 check to Sally to pay off her home equity (She has proof of the $100,000 check she previously wrote to Bob). This $100,000 will not show up on the closing statement since it is an unrecorded lien. If I write a $100,000 check to Sally, will this be applied to my cost basis for the purchase of the property? 

Wei,

Not many people are going to be able to respond with details regarding Forest Hills, Flushing, and Long Island City unless they live in Queens.

I live in Long Island City. Even within Long Island City, prices really can vary. If you are near the waterfront on Center Blvd, there really aren't single family properties for sale anymore - everything is sold as a potential development site. Every investor wants to buy there, especially since a modern 1 bedroom apartment rents for close to $4,000 per month today. However, there are multi-family properties for sale near the 21st Street Queensbridge subway station that sell for around only $1 million, because it's located near the government housing projects.

In Flushing, there's been a push into buying condos rather than individual houses in the past 10 or 15 years. What's driving up the prices in Flushing is as much cultural as it is the dense population. Since the Chinese population there have to purchase a home for their families, and borrow money up to the brim, they competitively bid up the prices of homes in the area. Fortunately the market there is strong and has been rising every year.

Both Long Island City and Flushing are appreciating areas, but it is very, very expensive to buy if you just want to occupy it yourself. As an investment, you're looking at 3-4% cap rates. I do not know much about Forest Hills. Good luck on your search.

Also, she's asking for receipts for capital improvements for a property I purchased 6 years ago, and I simply just don't have those. So she said if I don't have the proof, then I can't claim the depreciation on those capital improvements. Is that true?

Thanks for the feedback guys. I have 6 properties, and literally thousands of receipts. I kept track of my renovation costs when I initially purchased those properties, but I don't want to waste time gathering each receipt for each property to show my CPA right now. She has no reason to suspect that I am cheating, because I'm not. She did not taxes last year, and I found out that she solely depreciated my properties based on my purchase price only instead of purchase price + capital improvements.