How does this look from a tax perspective.

I assume they collect a proration every month for property tax?

Here are a few things that I like about the neighborhoods in Indy compared to other states: high rent-to-home-value ratio, consistent and gradual city development, relatively low property tax and insurance cost, affordable renovation service cost.

Taxes are the $100, so about $290 a month expenses. $110 a month in cashflow.

And given #3 above, it leaves about 20% of rent for all other expenses like property tax, insurance and other PM expenses like leasing fee, eviction fee and other minor expenses like for e.g landscaping, pest control etc.

If the purchase is done in cash, as you mentioned, they’d have more flexibility, but they’ll still want to carefully consider the tax and legal implications of the subsequent sales.I hope this helps, and good luck with your client’s deal!

If you need financial help, ask under the "Finance, Tax, and Legal" forum.

Typically, the adjustments I see on appraisals for basements are more flat rate adjustments. 10k is usually the number I've seen.What stinks is that there are a couple of model types that have below grade space where the builder, I'm sure, was trying to lower the taxes by having it below grade so the county wouldn't count that space in the assessment.

Britt,My firm has evaluated some smaller properties (under $500k) in the past for cost segregation, and it generally does not cost justify moving forward, since the benefits are small, and typically the tax liability on the income is minimal if any.

Some homes even come with tax breaks or city funding to help cover the costs.