All Forum Posts by: Jonathan Paz

I'll be out of town in FL!  @David Pere, can you host one on a weekend or family day/federal holiday?  @Michael Brockway are you going to be staying in Hawaii for a while?  I get back 11 Nov, and off 12 Nov if you want to catch up.  

Wow!  I’ll be there for sure!  BP has helped me grow tremendously since my first deal in 2011.   No way I would have the RE success I have now without this site and community.  Looking forward to meeting you guys.

@Michael Zagorsky Sounds like something I would be very interested in.  I no longer live in Melbourne, but I continue to invest there.  I'll be sending you a connection request.

@Liz C. I haven't set up my LLCs yet. I had to first work the insurance planning part (which I just finished getting quotes for and figuring out), and I am now ready to create my Florida LLCs under a holding LLC (TBD on State, but looking into Wyoming and Nevada). I know that I can create these LLCs fairly easily online, and I have an RA already for Florida, but will probably require some legal advice when choosing the holding company State and getting everything setup right. I have a close friend who is an attorney who I will ask to help me through it.

What @James C. and @Dwayne Byrd said is right on.  I’ve been investing in Melbourne since 2012 and home prices have doubled, while rents have increased by about 30%.  It’s definitely tougher to cash flow in a good part of Melbourne now.  I am seeing a little bit of a value and rent slow down, but still growing above inflation which is good.  Palm Bay is heating up now as well to pre-recession levels (Palm Bay is typical area where people go to buy and rent newer larger homes after being priced out of Melbourne/Beachside). I personally do not invest in Palm Bay, but if you learn the area, and with a trusted agent, there are plenty of newer construction nice homes there for under $200K that’s you should have no problem getting 1% rent.  

@Liz C. My Florida rentals are in Melbourne. Mostly known for the Kennedy Space Center, where they launch a lot of satellites. Pretty good area with nice beaches and good industry/schools/military base. As far as umbrellas, I'm just starting to call around for quotes, but learned that they have both commercial and non-commercial umbrellas, so I wouldn't just be able to get an umbrella now and then create the LLCs. Instead, it makes more sense to create LLCs, then get the right commercial umbrella over those and then a personal umbrella over your primary residence/vehicles/Non-LLC properties. Or, no LLCs at all and get a massive non-commercial Umbrella and keep it all very simple... I Definitely need to get all the quotes first and weigh all the pros and cons. I'm not in a hurry though.

@Duc Ong See you next week!

@Liz C., I have done an extensive amount of reading into Andersen and feel that their strategy is more complex than what I actually need. There are also many mixed reviews, but the general consensus is that they have a good strategy and know what they are doing, but they are more geared towards investors with very large portfolios and they are very pricey. So I will be avoiding them. At this point I'm just going to simply create a couple of Florida LLCs that operate under a holding LLC in a different state (Wyoming/Nevada/or Delaware.. TBD). The tax return will be pretty simple with this construct, and it seems like a very strong and simple strategy that is being used by a large amount of real estate investors (podcasts, forums, friends). I've also ran it by a close friend/attorney who agrees. At this point it's just a matter of picking the right company to set it up (many options out there), which isn't the hard part. I think the hard part is properly managing/operating separate LLCs like separate businesses (no intermingling funds, meetings/minutes/paperwork, separate bank accounts, etc.). This is where I think that having a strong/reputable real estate focused attorney can not only help you get set-up, but also help you consistently operate properly while also representing you if need be. It's just been so easy to operate the way I have been with everything in my name, and it has allowed me to rapidly grow with very favorable interest rates and terms, but it's time for the added liability protection which will unfortunately complicate things, add more expense, and limit access I have had to personal refinances/HELOCs/loans/etc... I'm also going to get an umbrella policy, but they are pretty tough to find affordable ones in Florida, especially when you have 10+ rentals.

@Lynn Leigh Thanks for the feedback about Anderson and I'll make sure to be extra careful when I vet them. Also, I read up on the article from eMinutes about Nevada LLCs. It's certainly targeted to comparing how California businesses fair to be incorporated under Nevada LLC, and I see where they are coming from. However, my rental properties are primarily in Florida, where I don't have all the high California fees, so my situation is different. There are certainly many states outside of just Nevada that offer great protection at an affordable cost (Wyoming/Delaware). I think the biggest benefit is just having another entity in a different state, with different state laws, that make it more complex for a lawyer to try and pierce the corporate veil. So I will put my Florida LLCs under a different state master LLC for that added protection, and affordability is important, but I want to make sure I also go with a company that can represent me in both Florida and the respective master LLC state. eMinutes is only allowed to practice in California, New York, and Texas, so they won't work for me, but still an interesting read. I also enjoyed reading this article from Wyoming, showing how they are better than Nevada and Delaware for incorporation. Definitely something for me to be careful about and do more research.

https://wyomingcompany.com/nevada-corporation/?k_clickid=224e7ca6-6530-4137-89d3-8589341582e1&gclid=CjwKCAiAx57RBRBkEiwA8yZdUJo68XKG5z1KJtFoooNXVu6B-T2vSE-PUk-i1zpg0XLHNtcLMzdjcRoCGHYQAvD_BwE

@Michael Mazzella, Thank you! I will be giving Diane Sandlin a call and setting up a meeting with her. I also appreciate the YouTube video showing how to set-up a Hawaii LLC. Right now I just need to set-up a couple of Florida LLCs and an overarching LLC (Nevada/Wyoming/Delaware/etc.). The Hawaii multifamily property (2 buildings, 6 units) I have is not ready to be moved into an LLC yet because it's on a VA loan and I heard you can't do that because VA requires the loan and property to be owned only by a Veteran that can qualify for a VA loan (LLCs cannot qualify). So to get the Hawaii home under a Hawaii LLC, I need to refinance the home, which I plan on doing that anyways when I go CPR it and sell it. I'm just not 100% sure when I want to do that because it's cash flowing nicely. Maybe if it keeps appreciating and I will have a tax free sale on profits (it's partially primary residence), I might pull the trigger and cash out. However, creating the CPR is something I do want to do in 2018 so I can be ready to capitalize on a sale at any time.

Do you also have any recommendations on a firm/individual that is good at creating CPRs?  My property already checks almost all the boxes (with the exception of 1 separate water meter I need to add to back building), so it's just a matter of doing all the paperwork.

- Jon

Hello,

I was wondering if anyone could provide me with recommendations for a good CPA/EA, preferably in Oahu, Hawaii, that specializes in Real Estate and tax strategy. I'm a buy and hold investor with rental properties in Florida, Arizona, and Hawaii. In the past I have done my own taxes, and think that I have done a pretty good job of capturing all the deductions and depreciation, but now that my portfolio has substantially increased and my transactions are getting bigger and more complex, I could definitely benefit from hiring a CPA/EA. I also plan on setting up a couple of LLCs in 2018, so if you have any recommendations on a good real estate attorney for that (doesn't need to be local/Hawaii), I would appreciate it! I listened to a podcast that had Garrett Sutton, from CorporateDirect.com, who talked about seting-up LLCs under Wyoming/Nevada LLC, and their company charges about $595 per LLC, plus $150 annually for representation. Another podcast had Clint Coons from Anderson Business Advisors and Law Group. Not sure if anyone has used them, or how their recommendation/attorney compares in price, but they did seem to be pretty reputable and certainly specialized in buy-and-hold RE LLCs.

Mahalo,

Jonathan