I'm still kicking my own a$$ about the half acre piece of land I could have bought with OF for $140k with $20k down back in around 2006 which is on a major highway in an area that is now seeing massive commercial and residential development.

It's in a city (outside the USA in Mexico) that has seen major growth the last 3-5 years and has great prospects to continue growing thanks to nearshoring and high cost of living across the border in the USA.I spoke to an architect and it looks like a 4-unit building can be built on there.

One owner is looking to exit to middle to high sevens on yield on cost.Cap exits are high 5’s, low 6’s for some Class A product.Turnover cost projections should escalate: $500 first year, $850 second year, $1000 third year.Consolidation and density of BFR assets can be an issue for insurance companies.

That's without any major rehab, just pure market rents in a livable condition.     

These expenditures are capitalized, meaning they are added to the property's basis and depreciated over time.Examples of Capital ExpendituresBuilding Additions: Adding a new room, deck, or other structural improvements.Major Renovations: Remodeling a kitchen or bathroom, replacing the roof, or significant electrical and plumbing upgrades.Appliance Replacement: Installing new HVAC systems, water heaters, or other major appliances.Structural Repairs: Replacing the foundation or significant repairs to the building’s structure.Labor CostsLabor Costs: The costs paid to contractors, electricians, plumbers, carpenters, and other professionals involved in the renovation are part of capital expenditures.Example of Capital Expenditures with LaborSuppose you renovate a rental property, including a new kitchen and bathroom.Materials: $15,000Labor Costs: $10,000Total Capital Expenditure: $25,000This $25,000 would be capitalized and added to the property's basis.

@Sendil ThangaveluYou should issue a master lease to the company, transfer all requirements & liability for the operations to them.

Unpermited units can cause a major headache down the line if you try to refinance or sell.Best of luck to you!

Can you share with me how you deal with tenants who's got pest issue?

Zachary Hello Zachary and congratulations on this major career milestone!

I know that there is a plethora of forms on the internet and folks pass them around like candy, but truth is, the property management business involves a lot of legal issues and situations.