All Forum Posts by: John Smeltzer

I'm looking to purchase a second home in Hilton Head (preferably Sea Pines Plantation) to be used when I retire in 10 years or so.  For now, the property would be rented out full time to help cover the costs.  Looking for advice if anybody has done this and how they approached it.  Based on the properties I've evaluated, it's hard to find a property that breaks even from a cash flow perspective after all expenses (including property management) with a 30% down payment.

From a pure investment perspective, I would choose to put money elsewhere.  However, the desire is to have a second home there.  I've only looked in Sea Pines Plantation but maybe there are other parts of the island I should consider if it makes more sense from an investment perspective?

Make sure you've excluded any land you own from the depreciation calculations.  From your annual depreciation amount, it looks like your depreciating the entire cost.  If you didn't buy any land, you're fine. 

That's right, but you don't lose the losses.  They can be carried forward and utilized when your property becomes profitable or when you dispose of the property.  I believe the losses get tracked on IRS Form 8582.  Turbo Tax should handle that for you.  As always, you should consult a Tax Advisor for your particular circumstances.

You should consult your Tax Advisor but the transfer to the LLC should be disregarded for tax purposes since the transfer is to a disregarded entity (essentially a transfer to yourself). You would continue to depreciate the property as you did when you purchased it in 2011.

Wondered if anybody had a similar situation and have any suggestions on how to handle. I have a condo I bought 3 years ago for purposes of renting it out. The previous owner used it sparingly (maybe 7 weekends a year). The first tenants I had were harassed by the neighbor next door for making too much noise. I engaged an attorney to write a letter to the property manager which didn't do much good. I believe the HOA Board saw the letter but did nothing. These tenants moved out.

New tenants moved in for a year and we had no complaints (or at least they didn't voice any complaints).  These tenants moved out and new tenants moved in.  I have the same problem again with this neighbor harassing them.  I was willing to believe that in the first case, it could be my tenants making excessive noise.  Now with the same thing happening again, I believe it's the neighbor.  He was used to living there with nobody next door, and now people live there.  When you live in a condo, you have to expect you're going to hear some noise from neighbors.

I plan to go to the HOA President to voice a complaint and am checking to see if I can add some insulation to the wall between the two condos. Short of those two options, does anybody have any suggestions or solutions?

@Ryan Beasley

Thanks for your response.  Can you tell me a little bit about the Statesboro market?

Can anyone recommend a good, investor friendly realtor in Savannah?

College towns generally have a strong pool of potential tenants.  You can of course rent to undergraduates but there is also demand from graduate students, professors, people who work for the university, and others connected to the university.  I've had a steady stream of renters in a college town that weren't undergraduates.

Since you live in the same town, I'm guessing you would manage the properties yourself but if you choose to use a property manager, they should be able to provide the market rate for rent and answer the other questions.  I use a property manager since I invest from out of town but I do look at what other similar places are renting for to make sure I'm in the ballpark.

I just posted recently that I'm considering Savannah, GA for rental properties.  I'm also considering Charleston and Bluffton and I'm looking for feedback on those markets for rental properties as well.

@Ian Skelton - Thanks for your feedback.  That somewhat lines up with my background.  I'm somewhat of a newbie but have purchased 5 properties to rent in a college town (Penn State University).  Colleges generally provide a steady stream of tenants, even outside of undergraduates and it sounds like there other things around Savannah creating demand.