All Forum Posts by: Joel Brown

My accountant informed me that if I hold my rental in an LLC, if I 1031 exchange it and I die there is no step up in basis. I would have to hold it personally for my family to get that tax forgiveness. Any other downsides to holding real estate in an LLC?

I closed on a house in Southern Utah that was recorded 11 days ago. It was in pre foreclosure so I helped the seller keep their equity by purchasing before being foreclosed. My mortgage company took its own sweet time and the seller lost their lined up rental to someone else. I had given her 14 days in the selling contract before I take possession of the property, as I knew she would need money for a deposit that she did not have. She had likely $50-60k now because of selling the house to me. She has a dog and a boyfriend (will poor credit and other issues) that make it hard for her to find a rental. I’m having a hard time kicking her out especially around Christmas. I’m contemplating having her give a security deposit and allowing her up to 4 weeks as a week to week tenant and requiring her to get renters insurance, pay up front, and give the dog up to be able to find a rental. She still has marginal credit but the dog and boyfriend and dragging her rental search nowhere. What are the potholes I could hit with this option? If I limit her to 28 days does that make eviction/ trespassing easier to get her out if it comes to that in contrast to a month /30 days? Utah I understand had laws leaning toward the landlord. Any suggestions?

@Joaquin K. I am looking at the Sterling oak (lighter color) and seasoned wood (darker but has multi width planks) and it looks great. I like the waterproof and DIY friendly as well. How tough is it to get the Pro price. I have spent close to $10K with them already this year so I should have looked into it before, but I'm re flooring (carpet in bed rooms vinyl or hardwood in the common areas and leaving the quality tile that is already in the bathrooms) a 3100 square foot two level home this month. With the other repairs i'm sure I'll spend close to 10K with Home Depot some elsewhere as well.  Did it go down easy? what do you need to do to get the pro pricing?

It has not been done yet, I just received a notice that my credit card would be charged $700 for the appraisal. It is an investment property like nearly all properties talked about on here.

I just received a Credit card charge for an appraisal on a house I'm under contract with in Southern Utah. I remember them being $300-400. Am I remembering wrong? Nothing fancy just a 3100 sq ft SFH with an in ground pool for less than $300K. What have you paid for an appraisal in the inter mountain area or more specifically Southern Utah?

I got a hard estimate for 3000 square feet, fortunately it doesn't have flex ducts do they can be scrubbed and mitigated along with every square inch of the house. Carpet and pad and drapes etc all has to go. They came and checked it out and quoted me $9k including carpet removal. Will cost additional to refloor.

One of the houses I'm looking at came back positive for meth use.  (3.5 / 100 cm2)  3.5 x the limit for normal so not likely a lab but it must have been a user in it. Is this a deal breaker. The clean up will likely be $5K -$7.5K, plus new carpets and HVAC, so the house will be better off when we are done. How much of a discount would persuade you to look at the deal or is it a hard no?  

As I investigate, estimates are 10% of houses sold have greater than the limit of 1 / 100cm2, and as high as 40% of all rentals nationwide have borderline or higher traces of Meth in them. Should it be a test for all houses sold (It can be in spendy houses as well as slums!)  

https://www.scientificamerican.com/article/former-...

Thoughts? 

@Jeff F.  The problem is the main portion is 1500 sq ft and the basement is 1000, so I guess I could portion it out as 60/40. My other issue is will the city shut down the second rental (even though a few others in the neighborhood are doing it. These issues are just enough to temper my excitement to make a quick offer on the property.

@Arun Iyengar

I passed on a deal a month ago, but the chance has come back as the sale fell through due to financing. My hesitation was that it is a twin home (I'd be buying half) with a mother in law apartment in the basement (good) that may not be able to be rented separately (bad). The neighborhood is mostly duplexes and it is zoned that way, but the twin house itself is a duplex with 2 separate owners. It could easily be a quad as each half has 2500+ square feet on 3 floors (5000+ total) complete with 4 separate entrances. The problems is each half has only one meter so the basement apartments are not on their own meter.

The other half of the twin home is being rented to 2 parties, but the owner tried to add a separate basement meter and was turned down by the city. How do you keep utilities cost down while including them in rent to 2 separate tenants / families? 

The house is in great condition with granite counter tops and hardwood floors solid wood cabinets etc (only a 15 year old house) at a very reasonable amount (~ $110/ sq ft). Can you divide utilities 60/40 or just include them and raise rent or? Obviously the feasibility will affect weather I offer and how much I try to discount.

I just about purchased a place in Springville with this very plan by back out as I didn't want to rely on the income and then get shut down by the city.