All Forum Posts by: Jen Hunt

@Will Fraser

I'm surrounded by mountains here in Northern UT, close to Utah lake, outdoor activities galore and jobs in abundance. I don't like downtown SLC so I'm halfway between SLC and Provo in a town called Eagle Mountain. I just listed and sold a 5 bed/3 bath home down the street for $375k super charming. Rental properties are an option as rents run approx 2k/month for a SFH. You can find properties under 300k still. Even brand new townhomes for $300k but rent would be closer to $1700 on those.

Contact me anytime.

JenHuntRealtor.com

Here we are 3 years later and my neighbor just sold through Homie and lost 20k in the transaction. The agent who is rarely reachable didn't have the expertise to procure a buyer who was able to pay the offer price without being subject to appraisal for loan purposes and since my neighbor was already under contract on another home couldn't start over in the process and had to simply knock 20k off of the price to meet the appraisal which was FHA and sticks with the property for months. A skilled agent who was on top of their market would've countered to prevent this but most average sellers have no idea what they are sacrificing going with a flat fee discount broker.

And to be fair, agents are for the most part willing to negotiate their commissions and this 5 or 6% is not a standard. Furthermore, the cost to list a home, pay the dues, marketing, open houses, TIME, contract expertise, continuing education, and all the other expenses and then self employment taxes, agents often barely survive. Something like 98% drop out in the first few years and the rest are making an average of 40k according to online data.

I think you run a huge risk going with a non relationship based broker. You just don't know what help you're going to get after you sign on the line. '

I think the OP did the smart thing. I've done the same for my clients. If I'm helping them purchase, I sell their current home at near cost. It's not making me rich by any means but I'm protecting my client's interest and feel good at the end of the day.

I went and drove around central NC and down into western SC to areas that had lakes. I can see good possibilities in the surrounding towns but all the countryside would likely be a NO GO. I finally understand why homes don't appreciate out there, you'll have one amazing house and right next door is a dilapidated trailer/mobile home overrun with foliage. Incredible beauty and access to lakes and outdoor lifestyle, great weather, tax breaks in SC, but nobody wants to pay $$$ to live next-door to a dump. 

I found great value in Loopholes in Real Estate

Thanks Yonah, 

Even though I'm a Realtor, I spend more time at my w2 job so I don't qualify as a RE Pro. so all of my income is active and I can only deduct 25k of passive losses for now. I expect that to be the case for the next 3-5 years so if a cost seg just front loads the same math rather than an even spread, I guess I'm best to play the slow game. I won't be in a position to purchase more property for a while but even if I did the gains would be far less than the losses with the depreciation and interest in my overpriced market. Perhaps I'll get brave and invest out of state some day, or the economy will finally shake our market and I can get some deals. :)

If I buy a 1.4m 4plex and intend to keep the building indefinitely, is there any benefit to a cost seg study? I don't think so, if the math works out the same over time.. in fact, since I have little passive income on the front end it seems I would benefit more by depreciating over the 27.5 years. Thoughts?

I would develop a RENTAL PUD and have my RE office manage the units as rentals and help my renters get into position to purchase a home of their own through FICO counseling and free use of the on site moving trailer. I would allow each renter to break their lease if they use me as their buyers agent. I would keep on staff a handyman and retain a legal assistant. In my dream world, once this was fully profitable, I would love to develop a gated community for abused women and children escaping violence in need of housing and assistance. Start a non profit and have a security guard on site and a full time legal assistant and therapist. Provide affordable housing and get them employment and education and the help they need to start fresh and provide their children with a safe and healthy environment to grow up in. Once on their feet, help them purchase a home of their own.

I'm going to start my investing strategy with townhomes as well. I've found several with a monthly HOA less than $150/month and comes with great amenities for my renters and what a relief to not have to maintain the building or yard. I won't cash flow for a few years but should break even which is expected for Utah right now. My goal is to have 10 in the next 5-10 years and if each cash flows a hundred or two by the end of the 10 years, that will suffice. Furthermore, they will be paying off the mortgages and I will be depreciating all that passive loss. My tax guy told me what's even better is I can depreciate most of the purchase price instead with a SF house you have to deduct the value of the land which is significant here. And the HOA is always deductible and that covers building maintenance. If the HOA charges a big assessment to replace windows as the previous post mentioned, that's something I would have paid anyway to replace windows in a SF home and depreciated over years. This will be a deduction in one year with the HOA.

Great advice guys! Yes my total income is right below 100k so I will benefit from the passive losses and it gets my foot in the door to future cash flow potential and appreciation. I've been watching from the sidelines too long. PLUS it will really boost my kid's FICO. When he moves out it will actually be closer to cash flowing since I'm cutting him and his roommates a teeny break.