All Forum Posts by: Kyle Mitchell

Income is $600,000 per year and husband and wife both work full-time non real estate jobs.

Is it true that the tax benefits are greater, or realized more quickly, on purchases like furniture or televisions to itemize a rental property, when they are made AFTER the date the property is put in service?

I am about to purchase a home in a popular vacation area. My family will get several weekends of usage out of it, but most of the time it will be used as a rental.

Mortgages on second homes are a full two points better than an investment property. The mortgage rules say (as I understand) that in order for a home to qualify as a second home, the owner needs to occupy it for more than 14 days. Any fewer and it is an investment and not a second home.

The IRS rules for being an investment property (and unlocking most of the tax advantages) are that the owner cannot stay in the home for more than 14 days. So the mortgage companies and the IRS set the exact same threshold for being a second home or being a an investment property.

My CPA however has advised me that there are caveats for doing repairs, or periodically visiting to inspect it, that allow you to exceed the 14 day leisure limit. So I could satisfy the mortgage company that it is a second home for the superior rates by exceeding 14 days, while still satisfying the IRS that it is an investment property.

Are you guys getting investment loans or second home loans for your AirBNBs?

I just purchased a lot in a popular vacation area. I intend to build a home that will be rented out to offset the costs of ownership.

I can find construction to permanent loans on second homes easily. I can find financing for investment properties easily too. But I can't find financing for CONSTRUCTION of an investment property. They want to send me to the commercial loan department where the rates are awful, closing costs are high, and the requirements much more robust.

What if I just get a second-home construction to permanent loan, wait 12-16 months for it to be built, spend another 90-120 days furnishing it, and then refinance into a traditional 30 year fixed as an investment property? Are there any tax implications or mortgage barriers to building a home under the "second home" plan and then converting it to an investment property shortly after its finished?