All Forum Posts by: Josh P.

Real estate = a business, and like with any business, how quick you get rich depends on how you define rich, how much risk your willing to take and how much volume your willing to work to sustain. But I think the intent of the statement is good since it is probably aimed at people who count too heavily on magical appreciation to make them rich

Here's my situation, brief as I possibly can state it:

In 2009 I bought my first rental property, a duplex.

I then converted it into a triplex, eventually converting all 3 units to corporate rentals to fill a hole in the local market. As of 4/9/2012, the business is still a sole proprietorship.

I have two 4 unit apartment buildings under contract now with plans to close on both prior to May 30th, 2012.

My brother has been doing a great job managing the property and will also do a great job managing the new properties when they close, and for what its worth he finishes his real estate license next month (I can make no such claim, yet :-)

I would like to form a parent company, an s-corp for ordinary income activities like fix and flip. I would also like to place all three properties into separate LLC's.

Is this the right strategy, as opposed t bringing family on directly? And should my brother form his own S-corp since he will probably be doing his own independent buy and hold and fix and flip deals.

Thanks everyone

Thanks so much. One more question. Typically how long does it take for a comp to hit the market and factor in to an appraisal?

I'm about to purchase a multi-family property about 3 blocks down from one I already own. The price I'm paying for it will no doubt create a decent comp amount relative to what I now owe on the first multi family which I'm about to do a cash out refi on. My question is, will it matter that I created the comp myself when the appraiser determines what my first property is worth for the refi? or is a comp a comp?

Hi Bryan,

It may not be a true ethical question, but its pretty clear to me that I'm not going to be able to raise the rents and it have the same effect on revenue. They are currently paying $450. I know from my other property that I will be getting $1,500 per unit per month, easily.

Also, I'm sorry I wasn't thorough in the original question, the former landlord allowed the leases to expire and DEFAULT to month to month. This may or may not be top of mind to the tenants, so I was just trying to get creative suggestions on managing perceptions because its a small town, and I don't want anyone damaging the place as they move their stuff out. Paying moving expenses was only my first idea.

Thanks for the feedback Mark. It's an idea I've vetted in another property I own down the street. I've been able to get over twice the normal rental rate and still come out profitably despite having to buy furniture and pay utilities because I'm cheaper than area extended stay hotels. The people who can afford my rates are usually homeowners themselves and so far, have taken care of my stuff (knock on wood)

The current tenants would be looking at a rent increase of the corporate rate minus utilities and furniture housewares and appliances depreciation.

I guess I could give them that option, but I appreciate the hard line approach. If it comes to that, then it does.

I just don't want to have to get into eviction because they neglected to look, so I was trying to think of a way to keep things pleasant and avoid all that, but I suppose uprooting someone from where they live is always just that.

I'm buying a new property. I'm remodeling the units and turning them into corporate rentals. All current tenants are on month to month leases.

How do I not renew the month to month leases for these good tenants? I thought about giving them each 2 months notice and then paying their moving expenses or something along those lines. How do I do this ethically?

Can I set up an LLC and run the money that is generated by my corporate rental business through it without putting my property in the entity right now? I'd like to put it in later.

the reason I'd like to set up an entity is because I want to start building business credit, but I've read on here the only good way to do that is a through a C-Corp.

any insight??

My wife and I have been renting in the area for 6 months. (subletting for cheap)

But now we both have jobs and we figure its time for our own space. We looked around and found a a place we love that rents for $1,375 which is more than we've ever spent on rent, but our real estate back home is doing exceptionally well so I figure we should spend a little on quality of life. We're pretty excited to move in, but that rent amount got me thinking just today:

I don't really want to spend 300k on a house here in Pedro, because for that dough I could buy a whole lot of income property where I'm from in Texas, but what about one of these short sale condos around here that seem to be going for around 120k?

I figure HOA dues property taxes, interest and insurance are money down the drain from an investing standpoint, but if we're going to be here anyway for at least three years, at what point do we say enough is enough with the renting and try to get into something that probably would never sell for less?

How hard is it to sell a condo if you buy one low?