All Forum Posts by: Joe Applegate

Yes - that is obvious, which is why I am asking if it can be applied retrospectively and "transfer" the house into a QOF. Or if there are any strategies people have used to capitalize on the OZ even though the place was not originally bought through an OF

This one is a doozy, but anyone who gives the best advice regarding this opportunity zone question will receive a gift from the universe….

I just took over a project from my elderly parents where they own a single-family rental that needs substantial improvements. As part of my diligence, I found out it is in an opportunity zone. Unfortunately, they bought the place back in 2014 and not through a QOF or with capital gains. Since then, the place has appreciated ~800k.

From my research, you cannot retrospectively put the investment in a QOF and reap the tax benefits (can someone confirm?!), but I see SO much potential here. Are there any strategies that can be deployed to still get the tax benefits? One thing I was considering was to sell the house below FMV to a QOF which I will create and fund though capital gains, and take the capital gains from the house and invest in the QOF, then I can perform the substantial improvements and let it cash flow for 10 years.

I can bring in 120k a year of rental income as I will put in a pre manufactured ADU in the back, and it is in a college town with high rent prices.

The house is in pretty bad shape due to weather this winter, and we have kicked all tenants out to rebuild.

Mississippi Investors ,

I have been doing a lot of market research, and I need your experience.

From a micro level, your stats on population growth, price to rent ratios, YOY job growth, crime rate, median income increase, etc... are the best I have seen in the country.

However, on a macro level... the state of Mississippi seems to be one of the worst performing states. Which leads me to my question: 

Have you found Mississippi to producing strong returns?

Here are my top cities that are producing job growth from 3.5-5%; strong median income; strong population growth; and low p/r ratios

@Dan Handford Where do you go to source that information? 

Everyone - I NEED INPUT

I ran some statistical analysis and found the cities in the US with the lowest rent to price ratios hovering around 2.0 to 4.0. I then read an article from a prominent investor that he invest in properties that produce a R/P ratio of 8 to 9. 

Are properties that have very low P / R ratios typically poor investments... similar to multifamily units that are producing huge Cash on Cash returns are probably slum units? 

EX: Phoenix, Illinois has a RP ratio of 3.72. The houses are small, very cheap, and rent is VERY high. The city is run down, and not in a good location.... what am I missing here?

Thanks for any input 

People love to talk about LOCATION, but no one loves to talk about QUANTIFYING their location criteria. Sure we want to see:

- Increasing jobs / economic growth
- Population growth 
- Low crime rates, or decreasing crime rates
- Local government investing in the area 

- Close proximity to transit, grocery stores, etc

However.... you rarely see people discuss what their strategy is for determining if an investment is in a good location. What numbers do you like to see when investing in a new location? What are the big things you look for?