Quote:
Originally Posted by Lafourche1
I have some experience with this situation. I moved in with her and rented my two other homes. These were both a bit higher end rentals that worked due to locations next to hospitals (medical professionals renting while they planned their next move).
Questions to answer:
How much of tax break do you get for property taxes and interest? Will you be looking for a faster tax advantage with depreciation (I don't recommend this personally but your tax professional may see it differently).
Bank the tax refund monies. You can expect a major repair every two years (HVAC), roof, plumbing, garage door issues. These are deductible depending on how you are setup tax wise but, are cash money out of pocket at the time of repair (how is your roof?).
After 8 years as a landlord, the return will be recognized at the time of sale. This is making the assumptions that your rent covered payment, insurance, property tax AND your tax refunds covered the repairs needed on the properties. Over X years time, given all the math works out, you have reduced the principal by X years payments and can now pocket that additional cash. You can end up with a larger chunk in your pocket that you really didn't have to come out of pocket to realize.
Find a good TAX Person. Talk this out. Renting is risky. You may have expenses you did not expect (busted hot water heater in ceiling - yes we put hot water heaters in the attic here - stupid place).
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Great info thanks. I just had the roof put on, and a new air conditioner 2 years ago.
Quote:
Originally Posted by arod55
I have been a landlord for a very long time, over thirty years. As a landlord you have to really screen your perspective tenants. That includes credit report, previous landlords and as long as you give a tenant 24 hour notice you can certainly check on your property. When you use a property manager you even have to check on them. A lot of property managers collect the rent check and do nothing else. I make it a habit to check on my properties at least twice a year. Like other people stated the only time you hear from them when there is a problem. Remember it your investment and do not ignore problems when they arise. Here in California when a tenant is late on the rent you must give them a three day notice to pay rent or quit. If you don"t do that the eviction process becomes more difficult if you have to go to court. Yes it does require work but eventually you acquire equity in your investment.
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Glad to know that too, thanks