All Forum Posts by: Rafael S.

I'm finding that MLS properties in the Phoenix area are way over-priced relative to the rock bottom rents there (like $.70/square foot) in the sub $150k townhome/condo category I'm looking at. Granted, I use two month's vacancy in my cap rate model but it just seems like anything on the MLS is below 7% cap. Are investors really resorting to direct mail / spam / bandits to get decent deals?

David,

I'm in the same boat as you looking for landlord insurance and I own in PBC too. I think the key is what perils you are being covered for, not just the amount. My HOA covers the exterior, the common grounds, and flood. I know that Cypress Casualty insured me while I lived there with an HO6 policy. That policy protected walls, plumbing, etc up to about 30% of my loan value...and it had small coverage amounts for medical bills, sewer backup, etc..and that ran $1,300 a year as an occupant. Totally worth it since I bought the place with a leak.

I've done about 5 minutes of research on BP which validates the above comments about the East Side.

As others above mentioned a gift tax return will have to be filed. Publication 590 cites a $1,772,800 gift tax credit in 2012 that is likely close to the number for 2013.

Hi Abdul,

Gifts are not taxable to the receiver of the gift. Gift tax is charged to the giver of the gift IF they are a US citizen and IF the gift given is over $1,772,800 (2012 number). The receiver of the gift files a gift tax return using Form 709.

As far as banking, third party wires are commonly used to fund new accounts.

Refer to Publication 950 or Form 709.

Wow so it looks like I might be too conservative here.

How many months rent do you guys deduct from gross rental income when determining your cap rate? In other words what is your vacancy rate?

I am currently deducting two months rent for 1980s, 3/2 townhomes, in a middle class area with great schools. Is that too much?

My thinking is if you used a realtor to find a tenant they would take one month. And if it took one month to find and collect rent, you'd be out another month.