All Forum Posts by: Stephen Brieloff

@Daniel Hyman + @Eric P. thanks for the intel! To make sure I understand the commentary, the recommendation would be as follows for the STR business:

• Not part of LLC
• Funds do not go through the LLC's business bank account
• Separate books, which are classified as personal, are kept to document STR income/expenses

Would the same recommendation hold true for my other rental properties, in which the title is in my name, not the LLC?

Hello!

I operate an Airbnb listing, renting out the second bedroom of my primary residence (which I own). I recently opened an LLC for my other rental properties. With that, I have also opened up a checking account to pass through all of my rental income and mortgage payments, along with other payments.

Is there any reason why I shouldn't pass my Airbnb income and expenses through the same business bank account, even though the primary residence, of which I'm Airbnb-ing the second bedroom, is not owned by the LLC?

My goal with this is to keep all of my business income/expenses completely separate from my personal income/expenses.

Thanks,

Steve

I am relatively new to investing, with one rental property under my, and my wife's, belt. I am currently looking to purchase a second rental property in the Chicagoland area. Based on the capital I have available and some of the opportunities I am looking at, I do not have enough to finance an opportunity on my own.

I can either wait until I build up the financing myself, or try to partner with someone. Though I like the idea of having sole control and ownership over a property, it makes sense to partner in order move closer to my investing goals if the deal is right. However, I have never done a partnership and could use some advice!

My questions:

1. How do you identify the right (and wrong) person to partner with?
2. What have been good sources of identifying potential partners? Personal network? Through realtor/other member of your team?
3. How have you successfully approached a potential partner with a deal?
4. How have you handled operating agreements between partners? Formal? Informal?

I Airbnb the guest bedroom in my condo unit and have been for almost two years. I've run into minimal issues with guests. Most of them in Chicago are simply looking for a place to leave their stuff and go to sleep; they will be exploring the city most of the time. 

The biggest challenge, if you are looking to make a profit and not just pay down part of your mortgage, is handling the winter months where demand dips consistently. One thing I've been using to help combat this is using Beyond Pricing, which prices each day based on demand, seasonality, and a host of other factors. It has worked out pretty well. 

@Peter Halliday I'm looking at 1-2 unit places that will required about $40k to rehab. Yes, construction will be part of the loan. I'm looking into places in Berwyn, IL. Hope that helps narrow it down a bit.

Anyone worked with local Chicago-area lenders they would recommend? I'm looking to work with someone on an upcoming rental property investment. Thanks!

@Gus Wigen-Toccalino I own a single unit and got to the point where I didn't want to deal with managing it myself. It was about 45 minutes between my home and the rental and I found self-managing was taking up more headspace than I wanted it to (which was the big thing), so I outsourced management. Think it is OK to outsource management at as few units as you want, since property managers take a % of rent.

I use Fulton Grace Realty for property management and have been happy with them thus far. 

@Ray Johnson the properties I'm looking at are currently off the MLS. I understand the numbers will need to work in leveraging a HELOC and those costs are essentially baked in to the next investment. Will need to keep looking and try to find the right opportunities.

I have owned my primary residence for over 2 years now and have been toying with the idea of a HELOC in order to leverage those funds to invest in another real estate opportunity. The challenge I am having is that the HELOC is an additional mortgage. So if I use those funds to invest in another real estate opportunity, I then have a mortgage on my primary, plus the mortgage on the new property, plus the HELOC payment. This has been a challenging mental block for me to overcome. Of course, if the numbers are great and the rental income you get is greater than all expenses, including the HELOC payment, everything works out. But I'm having a hard time finding opportunities like this.

How have others overcome this challenge?

Thanks @John Warren for the insight. Based on your comment is it safe to assume you are doing month-to-month leases? Is that more typical in that area?