All Forum Posts by: Ryan Johnston

Hi All,  I have a single family home that has been a long term rental I am weighing thoughts of cashing out vs renting it again as tenants vacate end of this month.  

Overview:

Address: 3960 Pleasant Shade Dr, Atlanta GA 30340 (Have owned for since Nov 2016 and depreciating)

Details: 3 bed 2.5 bath 1,847 square feet (None of the photos online are current)

Principal Owed: $232,000

Mortgage Rate: 3.375%

Monthly Payment: $2,010 + $250 for landscaping and pest control

Current Rent $2,450 a month

Projected New Rent: $2,750-$3,000 a month

Potential sales price $450-500k.  The home backs up to a busy road and I think $500k is a realistic hard cap on pricing for quite a while.  

I am a realtor myself so I can save on fees but my assumption is if I sell I end up somewhere with $200k that I would then need to pay capital gains taxes on.  I can also get a Home Equity Loan from Better Mortgage for another $70k and then sell which would reduce the taxable amount to about $130k

Curious on thoughts from others if you would prefer to try and rent it out again or sell and allocate the money elsewhere.  There have been a decent amount of repairs annually and at some point it will need the floors refinished and kitchen redone.  

 This is helpful thanks Bill!  The property is a bit older and back up to a main road so its been a lot of ongoing major expenses over there, plus in a normal market it would be less desirable but the lack of inventory may keep the price relatively elevated this year.  

I have another townhouse that I own currently as a rental. Not sure if there is way to 1031 exchange the funds from the old single family home rental if I do sell it into the townhouse and essentially buy it from myself into an LLC. The townhouse also has a 2.9% mortgage on it so I guess trying to do that could mess that up.

Hi,  

I have an old primary residence that tenants have been in and are now vacating, it was a bit of a unique circumstance so I am trying to understand the tax ramifications or best approach.  My current CPA hasn't been much help so I will be finding a new one.

The property was purchased and in 2016 and was my primary residence with my then wife.  We split in May of 2019, I was still living there so to finalize the separation I refinanced her off the loan by paying her equity in July 2019..  The plan was to sell the house so I moved into a condo in August of 2019.  The house wouldn't sell and then sat empty until I decided to rent it with tenants moving in April 10, 2020.  They are now vacating 5/31/2024 after 4 years.  

I am now remarried and my current wife never resided in the old house.  I know this doesn't meet the full 2 of 5 years living in there as primary as the tenants have had a 4 year lease but what if any exclusions are applicable here.  I am trying to understand the full taxable options.  

If I sell am I just paying full capital gains tax or does any type of exclusion or proration lower that?

Is the best option to 1031 exchange?

Should I just keep renting the home?

Some numbers for the house:

Purchase price was 275k, current loan balance is 235k, projected sales price would be $450-500k

The current mortgage plus maintenance is currently $2,200.  It is rented at $2,450 a month which is low and could re-rent anywhere from $2,500-$3,000 a month.  The current mortgage is 2.99%.  

Any thoughts are appreciated.

I live in Chamblee, I'll be at the next one.  

I have personally lived and owned a unit in this building and while the units have appreciated a lot the last few years, from a numbers perspective the rent to price isn't very good.  The waitlist for rentals is also 3+ years long and they don't have permits that transfer with new ownership.

Hi @John Christopher Campbell congrats on diving in!  I'd be happy to answer any questions about the Decatur market and give some insight into costs and rents to help you make the best decision.

HI @Erich Rasch welcome to Atlanta. I'd be happy to answer any questions that you have about the MF throughout Atlanta. Just North of Buckhead in Sandy Springs is the BP monthly meet up the last Tuesday night of each month and then there are a few local REIA groups as well.

Hi @Matthew Bridges, welcome.  I'd be happy to answer any questions that you have about Gwinnett.  A lot of my business is done there and I live in Doraville.

If you have solid tenant applications and 12 month leases locked in that would be more beneficial depending on what the apps and leases look like in addition to the rents relative to the area.  Feel free to PM me info, I might be interested.

Hi @Amy Park the first steps is to determine a price point and the return range you are looking for on your investment. The multi family in Atlanta is mainly intown and out east in Gwinnett county. There are patches sprinkled throughout but it varies neighborhood to neighborhood. You also have to watch out for the properties that are Zoned SFR but being marketed at a MFR through an owner conversion. Let me know if you have specific questions!