All Forum Posts by: John Akolt

I agree the answers to items 1-4 are all bull****.  Item 5 has some truth to it though. 
In my experience, it is very hard to submit an offer and have it accepted if you are not represented by a broker.  The listing broker simply puts your offer at the bottom of the pile and tells the seller you seem difficult\inexperienced, etc--it's unethical but it is life. 
(You can really get aggressive and try to submit an offer for 3% less but this is even less likely to work. It should but it won't.) I would suggest getting a broker who will charge an hourly/flat fee and give you a significant rebate (if that is legal in your jurisdiction).  FYI, if you don't have a broker then typically the entire broker payment goes to the listing broker so you are not better off without one--you just did more work.  If you are inexperienced a broker can walk you through the transaction and help you with pricing (but so can an attorney $500 and appraiser $350).  I think brokers really earn their pay by helping their clients not screw up a deal. Negotiations over the smallest issues kill a deal more than you would think.


 

Did you enter into an agreement with your broker? It seems the fee would be stated (and agreed to) in that agreement.  If not, she doesn't have much leverage.  Find a broker with no fees or have an attorney draft the purchase offer (less the broker's 3% and pocket the difference)

Looking for recommendations for an attorney to draft Illinois LLC operating agreement for SDIRA.

Looking for advice to locate tenants in Denver to file for an Airbnb license and potentially manage the bookings as well.  

Looking to purchase tax liens in cook county.  Would like to know the approximate fees attorneys charge to file the Sce 22-5 Notice and then the cost to obtain order for tax deed.  Any referrals for attorneys would be helpful as well.  Thank you!

Does anyone have any experiences with the Cook County Land bank--purchase process, deed restrictions, etc?  

Can someone please explain why you would allocate more income to land.  It seems it would only get more of the new 20% deduction but lose the better deprecation deduction for the building--(the applicable tax bracket for most owners will be above 20%).  Am I thinking about this wrong?  If you aren't in a higher tax bracket in the early years then the depreciation recapture won't apply to you upon sale.  

1. Yes, written partnership agreement.  Two problems: 1. you can't foresee every problem so you will have to work problems out--This can be an issue since it's family 2. It's family so even if it is written you won't follow it.

2. Yes, property managers will do the work--cost about 10%+ of the rent, depending on the area.  

3. Better option.  It is a promissory note on the property.  If you don't pay they can and should foreclose on the property (makes Christmas uncomfortable).  Not screwing your sister.  Parents are being paid for the level of risk they are assuming--less risk, less reward.  Are you happy with 8%?--if you put 50% down a bank would be better. 

4. I would avoid family deals unless you don't have other options.  Someone will always feel they did more work, etc.  You will be mad at your parents, your wife will be mad at you, your sister/parents will be mad at you/wife.  Hard to sue business partners.  Really hard to sue family.  It'll be great until the first down market and your parents need cash to pay for X or you need cash for the kids braces.  

I would do separate deals.  Help your parents find something and improve it.  Work for free.  Let them make the final choice though.  

I wish I knew what the Denver market would do too.  It is high but continues to increase.  It has always been a boom-bust town.  Avoiding any statement that this time is different there are some differences from the past.  Denver has more economic diversity now so it won't be hit by a fall in oil prices, etc.  It is also very popular for a good reason--it's beautiful and the weather and outdoors are great.   Downside: popularity may decrease as wages are comparatively low.  

I would caution buying outside of Denver for two reasons: 1. Traffic.  It is bad and getting worse.  As jobs grow downtown people will not want the commute. 2.  Water issues.  Many people don't worry about it but a number of southern areas depend on wells and/or purchasing water rights up north and piping it back.  Well water is limited and gets progressively more expense as more pumps are required to obtain the same amount of water.  Buying water rights (mostly from farmers up north), pumping water, building reservoirs and filtering it before using (see reverse osmosis) is expensive, even for cities (and their constituents via taxes).  Many cities are spending hundreds of millions on projects--see Aurora. Others are not addressing it or were slow to the game.  Either way water bills may get very high--multiple hundreds a month.

Denver has an old, well established water right system.  It may even benefit by selling its excess to the others.  

other issues--1. adding tenants not on the lease. 2. requesting maintenance for minimal issues (change a filter/lightbulb, etc) 3. likelihood they will stay at the property for 3 plus years

I can't see why a tenant would apply to 20-30 properties.  In my experience, they see a couple of properties and apply to one and move to the next if rejected. It might be beneficial to the landlord/tenant to know a certain tenant won't make the cut before wasting everyone's time to show it.  

The service might be nice and worth $ (100+) but would have to empirically show how it is different and better from a credit score and prior history (which can be easily determined by calling prior landlords and employers).  

It would be interesting to see if other factors unrelated to "tenant" activities lead to good tenants--do safe drivers or people who have a gym membership equal good tenants?  

Other factors that I consider--work history and pay.  The longer they have been with one company and have pay between 45k-70k the longer they will be with you and not cause any issues.