All Forum Posts by: Gail W.

OK, the current renters can't buy it. But my realtor friend said she may have some investors that would. But I'm sure they aren't going to offer us anywhere close to what we need.

So I've been looking into getting a refi- to wrap up the HELOC into the 1st at a decent rate to save some money each month. But everyone's telling me they don't loan on a property I'm renting out. Or not until I can show 2 years of rental income. So NOW what?? This house is becoming a huge pain in the arse....

Hmmm... wonder if they WOULD wanna buy it?? Good question! Couldn't hurt to ask.

If not, we'll just keep maintaining it and do fresh curb appeal right before selling. The tropical backyard always wows folks (you know how when you own it, all you see is the stuff you hate?? Ya. That's me and the yard.)

Hi all! Me again!  Come seeking wiser minds than ours...

As some of you may remember, we became accidental landlords on a SFR in South OC (Ca) when we could no longer afford it (and the kids split). We went thru a couple of awful tenants, but now have a wonderful friend running his sober living biz there, very successfully (house is well maintained, neighbors love him). We just renewed his lease for 2 years. It nets us about $2k/mo.

A few house facts: 5 bedroom, 2 1/2 bath, 3 car. Kitchen just completely remodeled last year, new flooring thru out, new paint thru out (thanks to insurance from a slab leak). We then took out $70k more to do...New driveway. New AC/heat system. New salt water pool system. New fascia boards. New water friendly (fugly) landscaping. Expand concrete areas on side and back yards. Master bath semi-rehabbed (shower stall resurfaced, stock vanity w/ new granite top installed, pony wall removed, door added, new tile floor) Kids bath upstairs needs a tiny bit of updating, but nothing dated and awful. Could use some backyard shade as we had to tear down the palapa tiki bar (THANKS asshat neighbors!). Some may say tile roof needs updating, but there's nothing wrong with it. Side hill (it's on a corner lot) needs rethinking for vegetation; that water wise landscaping never took, so it's bare dirt with a few spindly weeds. VERY hard to grow stuff there. The retaining wall that runs around the front/side could use the top cap bricks replaced.  Total owed: $470k.  Current values are around $805k (according to Z). Folks around South OC are saying that's sure to go up in the next 2 years, but who really knows.

At the end of the next 2 years, when the lease is up, we want to sell. We want to use the proceeds to purchase a place in Arizona that we will eventually retire to. The Mr will retire in 5 to 10 years (he says 5, but I know him and think he'll drag it out to 10) The place in AZ is easily rented until we can get there.  We seriously want out of California.

Meanwhile, we rent a small farm for a very attractive price, and are HOPING to stay here for that 5-10 years. Obviously, I know this is written in stone, and if it changes, we would have to do some scrambling. But we do have a family compound down the lane that we can utilize if need be.

I know most will ask WHY would you sell. We're still trying to deal with that, really. The house has sh*tty memories for one; thanks neighbors!! We aren't great with money and are still paying off "bad decisions" from years back, so that $2k/mo income is spent almost before it hits the account. We have no savings, so nothing to fall back on. We have nothing to put back into the property after all we already did. We have tax issues too. We just feel under water half the time. So we thought if we sell and pay off EVERYTHING, we'd feel more comfortable. We no longer use credit cards or overspend; we are very careful now. If things change in the next 2 years, like we find we can save money because of a few different scenarios, then we MAY reconsider selling. But right now, we just want out.

SO. Our question is, what can we do, if anything, to improve the value of the house in the next 2 years? Remembering that we don't have much $$ to put into it. Are there any projects we should try to do that would increase it's value by a good measure? If there were something that would really boost the price, we'd find a way to do it. Or is that something we should wait to do until closer to selling?

THANKS!

DANG. Now I'm regretting signing a 2 year lease for them. It doesn't start until July 31, but I guess once signed, it's locked. My "friend" who is a realtor didn't give me very good advice, I'm afraid. 

No, property management is easy. It's the huge taxes/quarterlies from the income. Like I said, we aren't that good with money. We're still trying to pay off debt from years ago when we were REALLY hard up. So there's never much left each month. We just want out now. 

Thanks all!

Hey all... time again for some wiser minds than mine to give me your 2 cents...

We have a great 5 bedroom SFR in an older, well established neighborhood in South Orange County, CA. Great tropical pool, new kitchen and floors. Large lots, not those new zero lot lines. Most homes well cared for- a few need a bit of lawn updating here and there, but nothing that looks total ghetto.

We were the one's who became accidental landlords; we couldn't afford the house any more. So we are renting to our friends who run a Christian based sober living thru the OC Archdiocese. They are doing well with only about 4-5 bodies and just renegotiated the lease for 2 more years starting August 1st at $5k/month. They take EXCELLENT care of the property/house- better than I ever did!

But we are getting older and are thinking of just selling and moving out of state. I know, you're all thinking, WHAT?! But we're just not that great with money or time management, so we're kind of done. Not to mention; we've HAD IT with California.

So my question is this: With renters that have such a long lease agreement, CAN I sell? Also, if I have that type of agreement for such a higher amount of rent than the surrounding homes, would that effect the asking price?? Would that make someone want it less or more?? Like if homes around there are asking any where from $820k to $1.35 mil, would mine look less desirable? Or more if it were a person who wanted that income?? 

Thanks all :)

I own a nice, large home in Laguna Hills, Ca that we could no longer afford to live in. We became "accidental landlords"...it just happened. After a few sh*tty tenants, we weren't so sure we wanted to keep doing it and almost sold the house. Then I met a friend who's hubby had been looking for an appropriate house to open his sober living biz in. He runs it via the Archdiocese on a very religious platform. 

All we do is collect the rent and come by to do the pool and small repairs. We're there a lot, but we chose to be, as we like the guys and keeping the place up nice. It's a 5 bedroom in a non HOA, quiet, family neighborhood. They have 8 "patient" beds and 1 bedroom is the house dad's. We have a tropical backyard with pebbletech pool, and allow a doggy (great therapy!)

We charge about $1000 over comparable properties. WELL, at least, we DID! Now the rents have skyrocketed over the past year and we find we could be renting to a regular sized family for about $200 less than what we get now! SO this upcoming July we renegotiate the rent and will be increasing it. Not sure by how much yet; still researching that. That's the tough part...we really like them and want them to stay, but we got creamed on taxes this year, so we do need to charge more to make it balance. Hard to know how much more to ask!

My husband and I own a SFR we rent out in California. We make excellent income from it, FINALLY (1st year claiming with a 1099). He works a full time job. I am the non employed half. We just had our taxes done and BOY did we pay!! We have to do quarterlies now.

Since I do a whole lot of nuthin (besides run a small farm for fun at our rental house)...My Realtor pal told me I should get my RE License so we can write more off. I found an online course from her that she uses for her crew to get licensed for only $200 (accredited). I went thru the workbooks/Exam Cram and aced it already (haven't taken the course yet) because it all relates to my previous job. So the online course should be easy (they guarantee you'll pass or $$ back)

We are not interested in purchasing more properties, accessing MLS, all the other stuff I've seen you all are stating are pros. I don't even want to work in a real estate office/selling. I just want the tax situation to be improved. We are older (the Mr is about 5 years from retirement) and I'm not up for a whole new career. THAT SAID... I wouldn't mind being able to understand what's what when the time comes for us to get to purchase the rental we live in now!

So seeing as how I have time and all, and the cost is not that much, will it save us anything off the taxes? Because even tho she says yes, it looks like there's more I'd have to do thru out the year. I DO actively do a lot for our rental (pool maint every week, fixing every lil tiny thing every week, etc...). Does that matter?

THANKS all!!

See my blurb, above. We (The Mr and I) are there almost twice a week; visiting our friend, cleaning the pool, working on upgrades...  Believe me, there are no worries about the clientele or the people running it. ;) 

All officers of said LLC have indeed signed personally and supplied their SS#s; and have paid full rent when the home was empty at times. They run it thru a Christian church and are very selective on who they allow in. It caters to the higher end of clients in South OC. Coming up on a year now and the neighbors actually love them! They do a lot of volunteer hours in the neighborhood; lawn work, paint, keep the common areas clean and chase off the riff raff (this is one those older, upscale neighborhoods w/o an HOA, big homes on nice sized lots; the kind they don't do anymore around here. Where the families are either newly retired or with older teens, which cause older teen types of issues if you know what I mean)

THAT isn't my issue. I was just trying to get some fast answers on a weekend (CPA is out) regarding how it may/may not be taxed differently as an LLC. And yes, Yahoo too only wanted to tell me how I could form an LLC if I collected rents... not if I rented TO an LLC. But thanks all! Got the answer!

THANK you. Such an easy answer...so hard to find on the innerwebz. :)