All Forum Posts by: Robert Steele

I advertise and manage my rentals with my property management company which is a LLC. I use a Realtor sign in the yard and list on the MLS. But all my property is either owned by me, my spouse or our trust so that is what goes on the lease.

If I was you I'd just hold it as a sole proprietor and use a DBA for your advertising, administration and management. Independent contractors (like Joe's Plumbing) do that so why not you?

Texas also had the most gun sales of any state last year based on background checks.

http://www.fbi.gov/about-us/cjis/nics/reports/1998_2014_state_monthly_totals-013114.pdf

I heard this from Mr. Carlton Sheets years ago. I actually took it to heart when I started out.

I looked at 100 REOs in 6 months. While I wouldn't recommend it I think there was some benefit to it even if it was not the intended benefit. There is a lot of subconscious knowledge one builds up from just driving neighborhoods, inspecting the inside of houses, doing comps and estimating repair costs.

Hahah. Tenant bonus program. How cute.

They say you can catch more flies with honey than vinegar but I don't think that works with tenants.

The only incentive I use is the tried and true method. Pay late, pay a fine. Don't pay, don't stay.

All greats tips except for that one.

If you a super serious about REI then that becomes your retirement account. The money going into a 401(k) could be put to better use in real estate in my opinion.

When I took a stab at this I was taught that your letter should be more personal.

Such as, sorry for your loss, trying times for the family, hassle of what to do with the property, I am the solution to remove this burden from an already burdened mind, etc. Basically be empathetic.

When I was renting in Australia 20 odd years ago they collected rent weekly. I believe that that is still the norm there. So hey, if it's good enough for 20 million Australians it should be good enough for you ;)

My spouse will get half of everything anyway as Texas is a communal property state.

I do treat my investments as a business. It's called a sole proprietorship and there is a lot less red tape involved. :p

Use your spouse and her income to buy 10 more. Or pay off all your mortgages with a portfolio loan. Blackrock just got into that game. Or pay off your smallest mortgage either with cash or maybe a HELOC on your primary residence and get a new one for property #11.

There have been lots of discussions on here about this. Search around.

@Jeff S. No my rental business has no formal incorporation. Some of the assets are owned by my limited partnership but that is just flow through income for tax purposes.

What I was getting at is that I have another business that is a LLC but taxed as a partnership. For that entity I could do what @Dmitriy Fomichenko suggested - I didn't realize it was so much $50K wow. I see there are some caveats so I will have to look into that further. So that takes care of sheltering that businesses income but I still have my rental income.

@Robert Leonard yes the Hummer was tongue in cheek. Your advice about putting only enough capital into your rentals to get the most potential out of them is one I already live by. My properties are already in tip top shape pretty much so the amount I could shelter through capital improvements there is limited.

I've looked into buying an expensive property at break even cash flow in the hope it doesn't depreciate and I can use the depreciation loss to shelter other income. But it is such a small amount it doesn't seem to be worth the risk.

The lowest down payment I can find is 10% with FNM Home Path. If I pick up a property for say $300K, that's $30K down, and I can depreciate it at lets say $8000/year and my marginal tax rate is say 33% then that only shelters $2640/year. Which on a $30K investment is a pretty good return of 8.8% but probably not worth the risk.

I think I need to stop doing my own taxes and find a good EA.