All Forum Posts by: Account Closed

Hi Cheney, 

It's hard to find the duplexes and tri-plexes with bang for your buck. Househacking is definitely a good niche. We are currently in one house hack where we split the house and added a kitchen down stairs, the units are completely separated and the both units are already rented for when we leave in the coming months to our next house hack/ remodel. The rents just make sense to rent the units separately and more affordable for the majority. 

You are more than welcome to come take a look at the house and the units and the property we are under contract on as well. Both units command very good numbers and the next investment projects numbers to what 4 plexes are going for right now. It's niche bro just got to get in where you can in a hot market and find your way to grow. 

I would recommend getting several electricians to come out there and give their opinions and get quotes. I would stay away from "Rockhill Electric" as he is notorious for quoting something then coming back towards the end of the project claiming it actually cost more. There is no shortage of electricians, I've had great experiences with "The Wire Ninja" and I've heard positive things about "phases electric". 

As far as the driveway goes it's hard to judge because less money spent is a better ROI and some salt would be a lot cheaper than fill dirt and re paving.

My wife @Kaley Roberts is a realtor and she's worked several quad plexes for clients and is under contract currently with one - your realtor should ""absolutely!!!"" be going to batt for you and seeking the best possible deal. It never hurts to ask... 

@Dave Foster thanks for the insights, the step up in basis is a bad thing right? That basically states when the kids inherit they will inherit the portfolio which will be valued higher? What are the negatives for the heirs at this point and would it be more beneficial for the old guy to offload this portfolio strategically for his kids sake? I could also just purchase the properties off market and save him the realtor fees which would offset the capital gains pain. 

You say do a 1031 and move into a passive investment - can you offer some examples that would sweeten the tax deal? Maybe he can max his IRA's etc. I'm sure he is old enough to start pulling from them. Thanks again for the input I've still got some research to do but I will post after our discussion.

@Natalie Kolodij thanks very much for the information, my lack of knowledge in this area just goes to show that I need to buckle down and start learning this stuff and getting in touch with the right people. Thanks again for getting me pointed in the right direction. 

One more to boot I don't imagine as a retiree his income is very high, would it be less of a pain with capital gain tax because of this? Is capital gain tax a set percentage to be paid? What I'm getting at is would it be less painful for him than his heirs who likely have full time jobs and a higher income. 

Also the installment sale is insightful though we may not go that route it maybe be better to have him just sell off one house per year. 

Also of note he would be saving money doing an off market deal so his realtor fees would offset any capital gains cost. 

Also considering the seller financing bit I'd improve the properties to sell soon thereafter but then he would pay those gains taxes still right? 

I have a neighbor down the street ask me how he could sell his 4 investment properties and not have to pay any capital gains tax. I thought do a 1031 like kind exchange but he is 75 years old and wants to liquidate his assets and put the cash in the bank. I would like to approach him with some solid options as I would like to have an option to buy his properties. 

Option 1: He 1031's all properties into something like or kind in value, treats it as an investment but after 6 months moves into the newly bought home for two years before selling. Not sure if he can make the move into an investment house and call it an owner occupied home or for how long it takes to qualify as an owner occupied. 

Option 2: We work to a seller financing deal to keep him getting paid but as his houses are free and clear he is already getting paid pretty good so the only value I see in that is that they wouldn't be his worry anymore. What if we did seller financing I fixed up the houses for a year and then put them on the market and paid the guy off. Is he still liable to pay capital gains on that money since the home notes are in my name at that point? 

Option 3: Whats the word from BiggerPockets? 

Megan, 

Thats great it's a super nice looking house. How did you get into that deal and what were some of the challenges and success that made it possible? 

Hi Adam, 

I think that will depend on your tenants. If you rent to some tenants that you think may find themselves in a position to need to pay rent with a credit card then yes add that option. Additionally Venmo is a service from paypal and is free as it is. Hope that helps.

I hope you trip to Pueblo was fruitful. If you still need some numbers to get a feel for the area DM me, I know November has passed but you can get a lot from some phone calls. Happy investing

A few years ago I read an article that Pueblo boasted some of the cheapest real estate in the nation. That's a good sign investors should be looking down there, get in before the prices rise too much you can witness first hand whats going on in Fountain - growing growing growing and so are the prices. I do happen to know Fort Carson is opening a gate 17 south of gate 20 and though it's not as far south as Pueblo it would make a quicker commute for some. 

I think it's definitely worth checking out and please let us know what your impressions are. 

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $345,000

Cash invested: $85,000

I did a BRRRR and bought a property in the dead of winter that had been rejected from the market.

What made you interested in investing in this type of deal?

I had money to reinvest from a BRRRR and was running out of time due to an upcoming deployment. We found this property in rough shape mold downstairs, asbestos flooring, and an apartment outback with leaky pipes and about a foot of ice on them.

How did you find this deal and how did you negotiate it?

Negotiated the price down because if someone was going to have all this work done it would cost big bucks.

How did you finance this deal?

20% down

How did you add value to the deal?

Sweat Equity

What was the outcome?

A nice renovation and great tenants

Lessons learned? Challenges?

Time is finite