Real Estate Investing: California Prop 19, how is the new assessed value calculated? |
- California Prop 19, how is the new assessed value calculated?
- What type of property should my second investment be?
- Scaling your rental portfolio. How?
- Could someone give newb advice on keeping current house as rental and buying new house?
- I'm 18, working toward my real estate license, what do I absolutely need to know for starting real estate investing?
- Getting started. Not broke
- Rent my Paid off Home, or Sell It?
- Discussion: Renting to people who pay weekly in cash
- How do you factor in depreciation tax benefits?
- Private Lending Resources
- Where can I go to learn about commercial real estate investing?
- A property is scheduled for sheriff's tax sale, but not until February 2021. Is it possible to purchase the property before then from the owner/bank/city or does it have to go to auction once it's scheduled?
- Tips for a first timer finding a cash flowing rental or BRRR property?
- C and D Class SFR Rental Margins and Modeling Assumptions
- Any Resources to Learn ARGUS?
- Am I ready to invest in real estate?
- Can lender require points on loan?
- Using data analytics
- Utility bills and student housing advice
- Need accounting/management platform advice
- Explain Wholesaling
- Not making enough to refinance - am I just screwed?
- Question about refinancing after closing
| California Prop 19, how is the new assessed value calculated? Posted: 12 Nov 2020 05:20 PM PST bill text: http://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201920200ACA11 So apparently prop 19 passed. I'm trying to figure out how they are actually calculating new values. The text reads: (A) The taxable value of the family home, subject to adjustment as authorized by subdivision (b) of Section 2, determined as of the date immediately prior to the date of the purchase by, or transfer to, the transferee. (B) The applicable of the following amounts: (i) If the assessed value of the family home upon purchase by, or transfer to, the transferee is less than the sum of the taxable value described in subparagraph (A) plus one million dollars ($1,000,000), then zero dollars ($0). (ii) If the assessed value of the family home upon purchase by, or transfer to, the transferee is equal to or more than the sum of the taxable value described in subparagraph (A) plus one million dollars ($1,000,000), an amount equal to the assessed value of the family home upon purchase by, or transfer to, the transferee, minus the sum of the taxable value described in subparagraph (A) and one million dollars ($1,000,000). so for example if you have a house that was bought at 500k in the 90's, and due to 2% increase every year under prop 13 is currently has a tax basis of 1 million dollars. If the Fair market value is 1.9 million currently then does that mean 1.9 million - 1 million = 900k which is less than a million and thus there is no increase in the tax basis? Say the house Fair market value is 3 million. Is it then 3 million -1 million = 2million and you pay stepped up taxes on 2 million or is it 3 million - 1 million (original tax basis) - 1 million = 1 million increased tax basis? Also how would the homeowners exemption work? Do you need to live there for 1 year or you need to live there forever? The text is very ambigous: 5) (A) Subject to subparagraph (B), in order to receive the property tax benefit provided by this section for the purchase or transfer of a family home, the transferee shall claim the homeowner's exemption or disabled veteran's exemption at the time of the purchase or transfer of the family home. (B) A transferee who fails to claim the homeowner's exemption or disabled veteran's exemption at the time of the purchase or transfer of the family home may receive the property tax benefit provided by this section by claiming the homeowner's exemption or disabled veteran's exemption within one year of the purchase or transfer of the family home and shall be entitled to a refund of taxes previously owed or paid between the date of the transfer and the date the transferee claims the homeowner's exemption or disabled veteran's exemption [link] [comments] |
| What type of property should my second investment be? Posted: 12 Nov 2020 04:35 PM PST Just to give you some context: I'm 26 years old and am closing on my first property next week. I chose to employ the "house hacking" strategy and luckily had an offer accepted on a top tier duplex for $425,000 that I'm purchasing via an FHA loan with 3.5% down (~25k with closing) at 2.5% interest in NE Minneapolis. I save up $1000 a month from my salary and I plan to cash flow about $250 from this property itself totaling $1250. Now that I have that under my belt, I'm wondering what the smartest thing would be for me to set my sights on next. I have a few ideas. a. Another FHA financed property, this time a single family home (since FHA only allows you to finance a second home if it has a smaller amount of units than the first one) This way i would be able to benefit from the 3.5% down payment again. I would also have to repeat the 12 month owner occupant rule again. b. A single unit property financed conventionally. I'm not sure what the down payment rate would be but I've heard a range of 3.5%-20%. Based on the down payment it would take me a variable amount of time to save up for it this way. c. Save up for another multi unit home, this could take me a lot longer. d. pool my money with someone I trust to try and invest via b or c. I was hoping I could get some advice, experiential stories or critique on my plan from you guys. If I'm missing something, please let me know! I'd very much appreciate it! [link] [comments] |
| Scaling your rental portfolio. How? Posted: 12 Nov 2020 06:44 AM PST I started my real estate investing career in July when I bought my first rental property. So far I love it. Although it's my smallest income stream it's my favorite, which could just be the honeymoon phase. I'm wondering what strategies people use to scale their rental portfolios faster. I bought my first property in cash, and am currently waiting the 6 month seasoning period to refinance and do it again. Which begs the question, how are people being able to use the BRRR strategy multiple times a year? Those who have several properties, how fast we you able to achieve that? Are there any strategies you used to scale faster? [link] [comments] |
| Could someone give newb advice on keeping current house as rental and buying new house? Posted: 12 Nov 2020 02:41 PM PST Current house would sell for $175-180k. Owe $69k with 6 years left on 15-year mortgage. Wife and I want to move into a house valued at around $400k. I am thinking I do a cash-out refinance extending current house loan to 15 years cashing out $50k (~30k for 5% down payment on new home and 20k in repairs to current home so it's in good shape as a long-term rental property - needs new roof, updated bathroom, etc.) Refinanced loan on 15 years would be $1,000/month. Could rent house for $1,300/month. So, I would have a rental property with a 15-year mortgage with rent covering more than the monthly loan payment and the minimum down payment for new house to move into What am I missing to make this not make sense? Rental (current house) is a starter house in a great part of town in a great school district. [link] [comments] |
| Posted: 12 Nov 2020 08:35 PM PST Essentially, the title is all what I'm curious about. I turned 18 this year wanting to start saving for a down payment on a house to rent out. Evidently the plan seems simple yet I need much more knowledge on the finances of looking, buying, owning, and overall maintaining a piece of land. In advance, I'd like to thank whoever takes the time out of their day to respond to this message and aid me on my journey! [link] [comments] |
| Posted: 12 Nov 2020 05:25 PM PST Alright guys so I'm 33 years old. Not married, no children. Started an online business when I was 25. It's still kicking. I did 2 lease options when I was 17 before the market crash of 08. Then became a bartender until I met my ex gf at 25 and was inspired to start my business a few months after meeting her. She left a couple years ago. But I want to stay on course. I did everything I told myself I was going to do as far as my financial ambitions EXCEPT real estate. I built up a 6 figure stock portfolio (currently up 45%, thank you corona), and 5 figures in savings. My business is scalable BUT it can disappear at any time. I'd like to diversify into real estate. Just to be able to sleep at night. I have a buddy in his 40s who has been a wholesaler forever, but every time we have a conversation it always goes back to people. I hate people 😂😂 so I'm thinking maybe building up a rental portfolio is the better choice? Thoughts? Open to any suggestions. Where should I start? BRRR? House hacking? I don't like the house hacking idea because I actually like where I live. Condo by the water. I also have a friend in her 40s that's been a rehabber and flipper for about 10 years but she hates it. Says she works way too much for what she gets out of it. [link] [comments] |
| Rent my Paid off Home, or Sell It? Posted: 13 Nov 2020 01:53 AM PST Hi Everyone - I am at a crossroads and wondering if I should get into the rental property business, or if it's better to sell my home and invest the money elsewhere. Here are some numbers: Home I live in: Paid off in full condo, valued at $550k HOA: $250k/mo Property Taxes: $6500/yr 4 Bd, 2.5 Bath, 2 car garage, 1600 sq. Ft. Likely Monthly Rent - $3000-$3500 (modest estimate) I would prefer to hire a property management company to deal with the tenants. I have enough saved to purchase my second home and put 20% down. I'm looking at a home valued at $800k (unfortunately I live in So Cal and things are a bit pricey as I'm sure you're aware). I would live in this second home, and rent out the first. I can afford to pay the mortgage on my second house, and do not need to rely on the first property's rent. Any advice would be appreciated. From what I've read, I have doubts about whether the rental income is worth it. My gross rental income would max out at $42k per year, and that's before any expenses. Again, modest estimates. Thank you for your help & advice! [link] [comments] |
| Discussion: Renting to people who pay weekly in cash Posted: 12 Nov 2020 03:39 PM PST I called a real estate agent about one property but it already had an offer on it, but he suggested I consider a different property. It was quite interesting, it looks like someone took 4 houses and divided them up into 4 units. For example there is a single electric bill. I think the asking price is at least double their true value. However, if you look at the cash flow, it is enticing. I can understand a bit better now why people say you can make the most money in these neighborhoods if you can handle the neighborhood. Basically the tenants pay cash each week. Apparently all tenants paid during covid as well. The real estate agent explained the tenants would listen to the landlord. If the landlord told them to leave, they would leave without issue. I asked about screening criteria. The landlord doesn't do a credit check, just verifies they have a job. He will do reference checks with a relative, but no co-signors. The tenant has to make 2x the weekly rent. I would think that could equate to 60% of their take home salary. I wasn't expecting this conversation so I was a little surprised but it, but definitely interesting. It seems like it is airbnb for very poor neighborhoods. I'm most curious how he handles his evictions. [link] [comments] |
| How do you factor in depreciation tax benefits? Posted: 12 Nov 2020 07:01 PM PST Title kinda says it. How do you legally depreciate your house for tax purposes? How does that affect your ROI? That came out weird but I can't word it better right now. [link] [comments] |
| Posted: 12 Nov 2020 08:51 PM PST Hey all. I'm looking to buy my first investment property and seem to be getting the run around from mortgage brokers. My local credit union told me I had to wait for any kind of mortgage due to being out of work from July 2018 - March 2019. I was told I should look into private lending but I'm not sure where to even begin. Any advice? [link] [comments] |
| Where can I go to learn about commercial real estate investing? Posted: 12 Nov 2020 06:35 PM PST I'm interested in learning more about commercial real estate but there isn't as much info about that on this subreddit as there is for residential real estate. Any tips on learning about the commercial real estate market? [link] [comments] |
| Posted: 12 Nov 2020 04:02 PM PST I'm interested in a property that I discovered is going to auction via sheriff sale. It is a tax sale. Covid has postponed the auction until February. Can I approach the current owner or city to purchase before? The sheriff's office wasn't helpful in this regard. Any help is appreciated. [link] [comments] |
| Tips for a first timer finding a cash flowing rental or BRRR property? Posted: 12 Nov 2020 09:06 PM PST I'm 37, have a very good full time job that pays well, own a $1.325 million dollar house, and have a strong stock portfolio. I've bought and sold a few houses in my lifetime, but always as a primary residence. Long story short I want to diversify my investments to include real estate, up until now I've been a serious stock investor but due to low interest rates, tax advantages, and an interest in hedging against coming inflation I really would like to have more real estate. I'm prepared to put maybe $50k-$100k down, and u fortunately live in southern California, so I probably won't be able to afford a rental here. Not to mention literally nothing I've looked at even remotely cash flows. I understand many people have had success out of state, and that you should first find a property management company that seems competent. I just can't for the life of me find anything that cash flows well (when factoring in 30% monthly rent for expenses and maintenance). How do these guys with 20 property portfolios do it? Especially interested in the Vegas, Orlando, Nashville areas in case I have trouble finding a long term tenant I figure these areas will do well with an Airbnb, not to mention they seem to have growing population and I can expect the property to appreciate well over time. Any tips? Am j being too conservative factoring in 30% for expenses? Am I just looking in the wrong areas? Is it normal for a property not to cash flow well right away? Any help would be great [link] [comments] |
| C and D Class SFR Rental Margins and Modeling Assumptions Posted: 12 Nov 2020 08:47 PM PST For those that invest in SFR rentals in C/D neighborhoods, what are your target margins? Cash-on-cash, free cash flow per door, maximum all-in basis per unit, etc. And modeling assumptions? Vacancy, opex, etc. I am scaling up my holdings in this market segment after doing a LOT of research, including talking to existing operators, and my one hang up is over-analyzing deals. I think I'm too conservative. As an example, I'm working on a deal right now to buy two properties for $50k each. One is rented for $825/mo with a good, long-term tenant, and the other will be vacant. Market rent is $875-$925, and section 8 (which I am open to) pays a little more. Taxes are $600/year each and insurance the same. When I run my analyses, I am throwing in vacancy at 10% and long-term opex at 40-50%. My gut tells me this deal is good, and my stressed analyses tell me it's thin. For example: Unit 1: $825/mo. Unit 2: $875/mo. (projected) Total: $1,700/mo.; $20,400/year Vacancy: ($2,040) RE Taxes: ($1,200) Insurance: ($1,200) Repairs: ($2,400) ($100 per unit per month) Misc: ($2,400) Total expenses: $9,240 NOI: $11,160 Cash on cash: 11.6% (slightly lower after closing costs) Ideally, my return would be 15% or greater, even better at 20%. For a C/D market, is 11.6% worth the risk and effort? What say you? [link] [comments] |
| Posted: 12 Nov 2020 04:52 PM PST As part of an interview process I have to complete a RE exam. Some portion of it will involve creating a model in ARGUS. Unfortunately, at the places where I interned we only used excel...Is there any resource you can recomend me to become proficient with argus. Something affordable, because I've only come across courses that are $1,000+ [link] [comments] |
| Am I ready to invest in real estate? Posted: 12 Nov 2020 10:23 AM PST I really want to build up a portfolio of rental properties to generate a stream of passive monthly income that can make me financially independent. I'm currently 24, single, and have about a $100k net worth. 30% of this is in retirement accounts so I have about $70k I can use to buy real estate. I have no debt. I live in south Florida, and it seems like you can buy 1-2 bed condos in decent neighborhoods here in the $100-150k range so I have enough saved to buy a condo with a 20-25% down payment. It also seems like you can rent out those properties for about 1% of the purchase price which seems like the monthly rent would be profitable over standard expenses. I have a close family member who is a real estate agent who can help me find a good deal. I'm not in a rush so I plan on taking my time to find the ideal first property. But I'm curious if I am on a good enough financial footing to start seriously exploring real estate investing? Thanks! [link] [comments] |
| Can lender require points on loan? Posted: 12 Nov 2020 04:11 PM PST I'm looking to cashout refi on an investment property and the lender (credit union) made an offer with 2 discount points. I asked if they can be removed since I'd rather not get the lowered rate. They said because it was an investment property and multiple units (more risky) they require points. Is this always the case? I'd rather not pay points and get more cash up front. [link] [comments] |
| Posted: 12 Nov 2020 04:10 PM PST Hello all.. does anyone where I can find a source of information about traffic trends in particular intersections or street? [link] [comments] |
| Utility bills and student housing advice Posted: 12 Nov 2020 07:24 AM PST So I plan to rent a property with 4bd/2ba in a college town. Do you guys suggest I pay the electricity, since each of these kids would be using power by their own requirements (and include the costs in their rent) or should I make them pay for it and reduce the rental cashflow? Also besides the Electricity, Lawnmower, Water and WiFi are there any other costs that I am missing that I have choice of this kind? I believe making them pay for it creates conflict within the house about who uses more or less. And I don't think I am allowed to put separate meters for each room, am I? [link] [comments] |
| Need accounting/management platform advice Posted: 12 Nov 2020 10:23 AM PST I'm looking for a portfolio management platform for investments. I currently own/manage about 50 SFH and multifamily apartment units. Some of them I own as the sole proprietor and manage myself, some units are owned with other partners and managed by me, and some units are owed with other partners and managed by a 3rd party property manager. In the end it is a paperwork and accounting clusterfuck. I've been managing it mostly on excel. Has anyone used an accounting and property management software that might work for a convoluted ownership and management structure such as mine? I'd like something where I can input my % ownership for accounting and tax reasons. [link] [comments] |
| Posted: 12 Nov 2020 03:11 PM PST Had a client approach me about wholesaling. Can anybody explain the ins and outs of how it works or point me in the direction for useful guides. I have a general idea of how it works but would a good explanation from those that have done it or do it. [link] [comments] |
| Not making enough to refinance - am I just screwed? Posted: 12 Nov 2020 09:19 AM PST Hey everyone - I have 3 SFH (2 rentals, 1 primary) and all have appreciated a really good amount over the last year. I was working with my lender to take advantage of the low interest rates and refinance two of them (1 rental and primary), but I'm in sales and thanks to covid I'm not making nearly as much as I was when I got each loan, so they won't do it. I understand debt to income ratio looks not great now and that's what they're looking at, but I don't reallyyyy understand how refinancing to lower my monthly payments thus giving me more income essentially is something they won't do. Is there any way around this or am I out of luck until I get my income back up? [link] [comments] |
| Question about refinancing after closing Posted: 12 Nov 2020 08:25 AM PST Hi, wish there was a weekly Q&A / "ask all your dumb questions here" thread I could ask this in since I'd hate to take up a post for something that may be a common question, but how easy would it be to refinance right after closing? I got locked in at 3.2 and am about to close within the next week, and lender won't budge on rate, which was set when rates were peaking a bit. Am I out of luck or could I take advantage of these lower rights with another lender immediately after closing? Or would a refinancing fee make it not worth it? Thanks. [link] [comments] |
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