All Forum Posts by: Harry McNamara

Thanks @Shawn Mcenteer

Manik, I sent you a connection invite. The area surrounding NYC is full of pockets of regulation, and other places where STR is allowed. It's really helpful to work with an agent who knows the area and what locations are fair game to invest in a short term rental property. I work out of Kingston, NY and cover a large service area across 6 counties that might be of interest to you. Looking forward to connecting!

Harry

Hello BP community!

Question is pretty much in the title - any other self employed RE professionals using a Section 105 on your taxes to offset insurance and medical costs? Curious if you got any pushback from your accountant, or if there is a boilerplate form to self record the establishment of the program going forward. Not sure if I should tap an attorney, or my accountant, or if I can just do it myself. 

Thank you fellow tax savers!

Quote from @Rich O'Neill:

Quote from @Jeremy H.:

Quote from @Harry McNamara:

Absolutely horrible idea that would explode the national deficit to an unprecedented level in no time flat, not to even go down the rabbit hole of how it would target the poor and middle class. I know I'd be raising chickens and turning my yard into a farm instantly too, not to mention that it would create an underground system of barter on used goods to evade the tax. Do I need that new TV anymore? Nope. Hmm, can I make all of my clothes last the rest of my life to avoid paying 30% tax? ...Yes. I think so, better stay fit!

 So let me ask you this - what is it that explodes the national deficit? Not taxing enough? Or wasteful spending? We've seen how successful the government runs it's programs...

As far as targeting the poor and middle class. Do you feel the "upper class" is being targeted now? After all I paid a 25% effective tax rate - due to what? Me simply earning more. I can't directly contribute to a ROTH IRA, I didn't get any stimulus checks, my income phases me out for many losses (they have to be passed forward or simply forgone), the list goes on. I'd be interested as to why or why not you think this is fair/equal.

I tell you what would be equal - a flat tax rate. What would be wrong with that? We each pay the same percentages of our incomes. There's too much social assistance in my opinion - and the mainstream rewards bad decision making consistently. Don't want to work? No problem, here's food stamps, a housing voucher, unemployment assistance, disability etc. Mainstream encourages divorce as well - here's let's actually pay the mom for taking the kids away from the dad, let's require more child support than the child requires etc etc

 I see you're the #2 Investor Psychology Contributor at the moment! Maybe I should have put this in that category! 

 Haha, I had no idea! Let's get deep man.

Most people at or below the poverty line already pay no or negligible taxes, so this would actually act as a huge tax hike on the poorest Americans, not to mention that it would erase other programs that help lower income Americans, like child tax credits. 

Not paying my CPA would save me $450, an absolute pittance compared to my annual spending x30%. 

This would be an absolute disaster for the economy as spending would collapse at the retail level beyond necessities.

It totally depends on your budget. You can make great returns on a house hack, maybe even pairing your residence with a cool STR if you find a single family with accessory in the Catskills or Hudson Valley. Or go straight up LTR and keep it simple. You want cheap? Oneonta. Want stuff to do? Albany/Troy? Best bang for your buck? Mid Hudson if you can find a deal, but don't expect to cash flow while residing in one side at these interest rates. You can probably live rent free and build equity though.

Absolutely horrible idea that would explode the national deficit to an unprecedented level in no time flat, not to even go down the rabbit hole of how it would target the poor and middle class. I know I'd be raising chickens and turning my yard into a farm instantly too, not to mention that it would create an underground system of barter on used goods to evade the tax. Do I need that new TV anymore? Nope. Hmm, can I make all of my clothes last the rest of my life to avoid paying 30% tax? ...Yes. I think so, better stay fit!

Very helpful reply @Chris Mason, thanks for your thoughts. 

Hello BP lender community!

I am an agent in the Hudson Valley area. I currently have a client who is in contract on a very interesting multi use property, and we're running up against this issue with more than one lender. They have both come back with 15% minimum down payment on multifamily. Is anyone still offering 5% down on multifamily, with owner occupying the property? 

Right now we are hoping for the appraisal to come back as single family with accessory apartment, which will clear the buyers with these current lenders, but if the appraiser sees highest and best use as a multi-family, we may be looking for backup lenders. Must work in NY. 

Thanks all!

Hey Patrick! 

Echoing the other comments that closing costs should be reasonable, for you just attorney and title search. I just wanted to jump in and say don't bother with the purchase offer agreement, in an off market deal where your attorneys are handling everything just go right to contract. It's more protective of your interest, and the PO is unnecessary. 

Quote from @Trevor Naumann:

Quote from @John Morgan:

Tenants are smart and some will game the system so that’s a risk. However, investors are leaving tenant friendly states due to how bad landlords got burned during Covid. So, I bet more and more really good cash flowing deals will pop up in those areas due to way less competition from other investors so that’s a plus. I have a W2 and don’t need to live off my rental income, so I’ve been taking risks like this and it’s been paying off. I’ve been burned a time or two, but over the long run I’ve done alright and have no regrets. So if it were me, I’d probably take a chance on it. Good luck.

 working in new york between the city and albany this couldn't be more true. In kingston for example which is very tenant friendly they recently tried to roll back rents by 15% and institute rent control. As it would turn out its implementation was not legal  and it is likely to be overturned. In the meantime it scared the current landlords and now we are seeing some crazy deals. For example a 17 unit building with an assumable mortgage at 4% new roof, and rehabbed just went under contract. Its a 9 cap and was marketed at 1.6 and is selling for less. For our area thats a crazy deal. Riches are in the niches right? In some of these markets which are perceived as "not great for investing" there is way less competition and investors have the ability to create great deals with the right strategy. 

Trevor, this is true but the rent reduction only applied to 1300 apartments across the city. This law is only applicable to buildings containing 6 or more units, and functionally that is only 64 buildings in the city. Important to note for larger scale investors, but for the purpose of this conversation and the average BP contributor it really doesn't apply. I encourage investors to come to Kingston and the surrounding area as we have some very reasonable prices on 2 unit multifamily right now, the rents can work, and the demand for housing units is through the roof.