Deduct NEW property taxes after you buyDeduct home insurance costsDeduct maintenance percentage, typically 10%Deduct vacancy+tenant nonperformance percentage(we recommend 5% for Class A, 10% Class B, 20% Class C, good luck with Class D)Deduct whatever dollar/percentage of cashflow you wantNow, what you have left over is the amount for debt service.Enter it into a mortgage calculator, with current interest rate for an investment property, to determine your maximum mortgage amount.Divide the mortgage amount by either 75% or 80%, depending on the required down payment percentage - this is your tentative price to offer.If the property needs repairs, you'll want to deduct 110%-120% of the estimated repairs from this amount.Be sure to also research the ARV and make sure it's 10-20% higher than your tentative purchase price.As long as the ARV checks out, this is the purchase price to offer.It is probably significantly below the asking price.

@John Malone are you a tax attorney?

Income Late fee Gross rent Expenses Advertising Cleaning Gardening/lawn mowing Insurance Interest on loan(s) property tax Legal expenses Pest control Property agent fees/commission Repairs and maintenance Water charges Electric Bill Total expenses Net rental income or (loss)

However, after running the numbers accounting for insurance, PMI, taxes, vacancy, capX, property manager, etc. the property is estimated -1.85% cash on cash return (-$600/mo) once I fully rent the property.

I have 11% taxes and they charge their fees on taxes also so my effective rate is higher since I don’t keep the taxes but pay the fees on them.  

@Renee LeFevreTo rent out your basement, follow these steps: check local regulations, prepare the basement with separate entrance, screen potential tenants, draft a lease agreement, set the right rent price, consider tax implications, update homeowner's insurance, and build a positive tenant relationship to attract quality renters.Good Luck!

As long as you're slightly under market you shouldn't get much pushback on rate increases (just blame it on taxes).

COMMUNITY- will the community support this type of housing (talk to other developers, visit projects of similar nature preferably in the same area and price bracket).3.

I recommend finding a tax strategist who specializes in real estate taxation and tax planning.You may want to consider working with your accountant remotely to expand your options.I would also recommend looking for a accountant willing to work with you throughout the year.

I’m originally from NYC and I’m currently working overseas for nearly 10 years as a Construction Manager and have been enjoying my time here as well as my family (and the tax benefits too!!).