All Forum Posts by: Nick Bleser

Hello BP!

We bought an 8-unit property in 2018 and am working on the taxes for this property. As we've had turn over for each unit we've been painting, making repairs to things like cabinets and closets and also updating things like door handles and light fixtures along with other small expenses. 

I understand if we replace things like carpet or new cabinets it's considered a capital expenditure. We've turned over 4 units and most of our expenses have been very small but have added up to thousands of dollars in materials and labor. 

I'd also like to add we don't do any work ourselves. We have a handyman do all of our work so I'm trying to figure out how we deduct these expenses. Maintenance/repairs or Cap Ex?

Does it make a difference if we just bought the property and are doing repairs that "we" think are necessary like replacing a door handle that's not broke but obviously been the same handle from the 70's?

Even though we're spending a lot I don't think these repairs add significant value.

Any thoughts are appreciated.

Thanks!!

Hello BP! I have an opportunity to buy a property with 4 business spaces and 2 rentals. I've never owned commercial but the price is so good I'm having a hard time not passing it up. The catch is it's located in a very small town and somewhat depressed area. The numbers work well and I have room to raise rents but I'm concerned about the local economy.

Does anyone own property like this that could share their experience?

I'm also wondering when owning commercial how much do you do to help the businesses? For example right now one of the businesses spray painted their name on the window with washable paint and they didn't do it very well. I might be interested in setting aside money or allowing them to pay back a small loan for window stickers so they will look legit. I figure if they're successful I get my rent and everyone is happy.

Any information is appreciated,

Thanks!

Found a product by Murphy's oil that has a stain in it. Just rub into woodwork and it darkens scratches beautifully.

I'm turning over an apartment next month and am wondering what owners do about scratched and worn moulding besides paint. This 8 unit property is new to us and this will be our second turnover. The first apartment we repaired we updated almost everything except the moulding and flooring. The next unit we will have to replace carpet and I'd like to clean up the moulding but hope not to replace. 

Does anyone have a good solution to clean it up?

Thanks BP Community!

Thanks @Jim K. ! I learn a little something from every deal. It's how I grow.

@Jim K. this is a different scenario. That was a foreclosure that I never expected to get a security deposit. The question was more about how to handle the tenant's situation. I ended up telling them they could try to get their money back from the previous owner but I was staying out of it. The owner was someone I knew that is heavily into drugs. The tenants didn't even have a lease.

I've thought when they move out I might give some money back just to guarantee they remove all belongings.

Thanks @Aaron K. and @Peter M.! I'm going to eat this one. It's far less than $1,500 and not worth the hassle. I learned a ton from this deal. Not only did I learn how to be a better buyer but if and when I sell a property like this one I will know exactly what to prepare, even before the for sale sign goes up.

Thanks again!

We recently bought a 8-plex and the transfer was a mess. This was partially due to our inexperience and a landlord that was way too loose in my opinion.

Before I explain here's my question:

Should I contact the previous landlord because I think we were shorted 1 tenants security deposit. We've owned the property for 2 months or should we eat the cost and learn from our mistakes.

Here's the confusion. Before we purchased the property the security deposit situation was very hazy. We were never given a solid number on how much would be transferred. I later learned the listing agent was not asking the landlord and was just guessing by looking at the messy leases. We later found out that for some move-ins the landlord would allow tenants to not pay security deposits if they cleaned and prepped the units. 

So the day of closing we were still guessing at what was owed. It also didn't help the seller decided to take vacation this week(unbeknown to us they pre-signed). We ended up forcing the seller to meet us the day we signed and we sat in the parking lot adding up what was owed. It was a total **** show! What was so confusing was we closed on the 1st of the month so some rent was paid some wasn't some tenants had security deposits some didn't. I have never been so confused by simple math in my life.

After all this we thought we had everything correctly accounted for. Now it turns out we didn't. A tenant we thought didn't have a security deposit in fact does. They proved it with a receipt.

Again, my question is should we eat the cost or should I go back to the previous owner and ask for the deposit?

Thanks BP!

We recently bought an 8-plex and just had our first move out. The tenant did a good job at cleaning it out but you can tell the landlords over the years haven't given it a lot of TLC. We decided to replace a lot of small things and I'm wondering if it's considered maintenance or capital expenditures from a tax deduction point of view. Examples would be new toilet, door knobs, light fixtures, blinds, faucets, etc. 

Can all these items plus labor be deducted?

Thanks BP community!

Thanks @Thomas S. @Dick Rosen and @Nathan Gesner! Good info on the estoppel for our next property. We are signing new leases since they are month to month. I'm just finding the past landlord was less organized than I'd like to be so I thought even though the current tenants aren't re-applying, filling out an application would be a good form to collect info.