| Rent Update, Feb 2012, 9 vacancies, collected 94.8% of total ren |
2012-02-26 14:34:48 |
 |
|
Rent Update, Feb 2012, 9 vacancies, collected 94.8% of total rent.
Finally we are seeing some spring activities in late February, many quality calls are flooding in just pass week, we improved the rent roll some what this month.
People still prefer SFH compare to apartment living, SFHs continue at 100% occupancy,
We offer 50% off on first month rent on the new complex, hoping to fill few more units.
For February, of the 134 total units own, we closed the month with 9 opens.
SFH + Duplex (44 units), collected 107.71%, full occupancy, no opens.
Commercial Office Park (10 units), collected 90%, 1 opens.
Apartment Complex One (40 units), collected 95.3%, 3 opens.
Apartment Complex Two (40 units), collected 81.3%, 5 opens.
07/09 97.5%
08/09 95.4%
09/09 88.7%
10/09 91.6%
11/09 95.1%
12/09 92.5%
01/10 97.6%
02/10 104.6%
03/10 94.55%
04/10 90.3%
05/10 106.8%
06/10 93.4%
07/10 97.5%
08/10 93.8%
09/10 99.15%
10/10 100.8%
11/10 91.8%
12/10 89.9%
01/11 90.3%
02/11 95.6%
03/11 100.2%
04/11 98.44%
05/11 101.3%
06/11 97.06%
07/11 SFH 89.65%, Office 100%, Apt1 94%, Apt2 80.4%.
08/11 SFH 90.1%, Office 100%, Apt1 101.9%, Apt2 80.7%.
09/11 SFH 98.3%, Office 90%, Apt1 94%, Apt2 91%.
10/11 Overall 89.9%, SFH 90.9%, Office 90%, Apt1 90.9%, Apt2 86.6%.
11/11 Overall 92.4%, SFH 95.7%, Office 90%, Apt1 100.2%, Apt2 79.8%.
12/11 Overall 87.7%, SFH 94.9%, Office 90%, Apt1 90.5%, Apt2 77.5%.
2011 Year End, Overall 93.2%.
01/12 Overall 89.3%, SFH 96.8%, Office 90%, Apt1 91.8%, Apt2 77.2%.
02/12 Overall 94.8%, SFH 107.71%, Office 90%, Apt1 95.3%, Apt2 81.3%. |
|
|
[打印]
|
| |
|
|
| LandLord, as a way of life... |
2012-02-22 09:59:55 |
|
|
every time I am on this topic, it is depressing. Why? because in most people's eye, landlords are heartless slums...
in some way, I agreed, but I must also say, landlording is not charity work, we are not doing God's work, we are just only human, we need to survive this world too.
for example, today's schedule...
6:15, get up to smell the coffee.
7:15, Daughter missed the school bus.
8:15, had to be in court, I have 17 cases today, I occupy the court home from about 8:45 to 10:30, just for me.
11:00 nothing to do, browsing WXC.
1:00 meet wife for lunch?
2:00 need to see a SFH, which tenant just moved, my guys been there since 9:30.
4:00 need to pick up daughter?
......
17 cases today, all related to collections. Judge issued 5 bench warrants for contempt, 5 agreed on payment plans, 9 postpones for varies reasons.
this is the 3rd time in court this month, next hearing is on Friday the 24th, then 28th. so far I have 2 court days set for March, and 2 for April.
currently Under Eviction 0
waiting on judgment on back rent/damage 0
pursuing collection 11
paying or under garnishment 20
civil warrant ( dead beats ) 16
Case pending due to no-serviceable address 3
Case pending due to defendant in jail 3
Case dismissed due to death 2
Case dismissed due to bankruptcy 4
Case paid or settled 41 |
|
|
[打印]
|
| |
|
|
| single tenant triple N, is somewhat high risk.... |
2012-02-22 09:11:28 |
|
|
single tenant triple N, is somewhat high risk....
if you have a national longer term tenant, like CVS, Walgreen, it is the best deal, but expect cap at 5-6%.
if you have a smaller prvate tenant, once you lost him, your property can sit there for many years before it can find another one.
the cap rate reflects it all, higher the cap rate, higher the risk, this applies whether the property is commerical or residential.
also, cost of financing a commercial deal is much higher, expect 2%-4% upfront cost on commerical loans. |
|
|
[打印]
|
| |
|
|
| Zted. Not all Pass-Through Entities are Created Equal. |
2012-02-22 08:43:24 |
|
|
Not all Pass-Through Entities are Created Equal for Holding Income Producing Real Estate
March 2010 -- The common wisdom holds that income producing real estate should be held in a pass-through entity; however, when it comes to holding real estate, not all pass-through entities are created equal for income tax purposes.
Pass-through entities are the vehicle of choice for owning income producing real estate for many reasons. These reasons may include:
Avoidance of double taxation on a gain from the sale of property,
The benefit of the lower capital gains tax rate on sale,
Ease of admitting new owners,
Special allocations of tax losses to the "money partners," and
"Back end" incentives for the developer partner.
Partnerships and Limited Liability Companies (LLCs) operate in nearly the same manner for tax purposes. The main difference is that an LLC member, like a limited partner, is not usually "at risk" (discussed below), and therefore his basis in his LLC interest is not increased by his share of LLC recourse liabilities (assets of the LLC are subject to repayment of the debt); whereas a general partner is at risk for recourse liabilities. As discussed below, obtaining basis from debt can greatly impact your ability to claim tax losses and receive tax deferred distributions in excess of your capital contributed.
The other type of pass-through entity is an S corporation. An S corporation is a regular corporation for legal purposes; however, for tax purposes, an S corporation generally does not pay its own taxes. Like a partnership or LLC, an S corporation passes through its income or loss to its shareholders, who report their share of the income or loss on their personal tax returns. There are, however, some significant differences between the tax attributes of an S corporation compared to a partnership and LLC, and those differences can create negative tax consequences for the unwary.
The overriding tax benefit from holding real estate in a partnership or LLC, as opposed to in an S corporation, is the potential ability of a partner or LLC member to claim tax losses and receive distributions in excess of capital contributed without incurring a current tax cost. In other words, the tax basis capital account balance shown on Schedule K-1 can be negative without any tax consequences until the property is sold, provided the negative amount does not exceed the partner's adjusted basis in the partnership.
Adjusted basis begins with the amount of money or assets contributed to the entity, and it is increased by allocated income, direct loans made to the entity and the allocable share of entity debt. Adjusted basis is decreased by allocated losses and distributions, loan repayments to the owner and the allocable share of any reduction in entity debt. The components of adjusted basis are pretty straightforward for all pass-through entities, including S corporations, except for the concept of debt sharing. S corporation shareholders only get basis for personal loans made directly to the S corporation. They get no basis for any other type of entity level debt, even if they have personally guaranteed the debt.
The negative impact of this difference in the treatment of debt sharing for S corporation shareholders is exacerbated by Internal Revenue Code Section 465. Section 465 generally limits a taxpayer's loss deduction from an activity to the amount for which he is "at risk." The at-risk limitations operate independently of the limitations for adjusted basis. Under Section 465, a taxpayer generally is at risk only for the cash and adjusted basis of the assets contributed to the entity, plus any debt for which he is personally liable.
A very important exception to the general at-risk provisions exists for qualified nonrecourse financing secured by real property used in an activity of holding real estate. Qualified nonrecourse financing is debt for which no one is personally liable for repayment and that is borrowed from a qualified lender (a person actively and regularly engaged in the business of lending money, such as a bank). This exception treats the taxpayer as being at risk for his share of qualified nonrecourse financing, even though he does not have any personal liability. This provision greatly increases a partner/member's adjusted basis in the partnership or LLC and hence, the amount of losses that can be claimed and the level of tax deferred distributions that can be received.
This rule allows many real estate investors to enjoy cash flow that is significantly greater than their taxable income. This is especially true when a partnership or LLC refinances its debt at greater than the original loan amount, and then distributes the net proceeds to the partners or LLC members. The distribution is usually tax deferred, whereas in an S corporation this distribution will usually be taxable. Note that the deductibility of interest allocable to debt-financed distributions may be limited depending on the uses of the distribution. And do not forget that the distribution is not "tax free" but merely "tax deferred," which means there will be a tax in the future.
Another important distinction in holding real estate in a partnership or LLC as compared to an S corporation is the potential ability to distribute appreciated assets tax free. Partnerships and LLCs can generally make tax free distributions of their appreciated assets to their owners, provided the partner/member's adjusted basis in the partnership/LLC exceeds his capital account balance. This is especially useful in a real estate partnership when, upon the sale of a property, some owners want Section 1031 exchange treatment and others want to cash out (a transaction by a partnership where some partners want to cash out and some want to effectuate a Section 1031 exchange is a complex area beyond the scope of this article). In this manner, it is possible that the exchanging partners would have no current tax liability from the sale.
In contrast, a distribution of appreciated property from an S corporation will trigger a corporate level gain that is allocated proportionately to the S corporation shareholders. In exchange for an allocation of that corporate level gain, the S corporation shareholder's basis in the property received will be equal to the property's fair market value at the time of distribution. The partner/member's basis in the property received will be equal to the partnership/LLC's basis in the property (not to exceed his basis in the partnership/LLC).
If you are caught in a situation where you are holding appreciated real estate in an S corporation, today's economy may offer an opportunity to switch to a partnership or LLC with limited tax pain. Today's lower real estate values will lessen the corporate level gain on distribution to the shareholders or upon conversion of the S corporation to a partnership or LLC. Furthermore, if you have unused capital losses from the 2008-2009 economic downturn, those losses may be available to offset the gain on distribution from the S corporation. The best planning is to avoid holding real estate in an S corporation in the first place. Your CBIZ MHM tax advisor is available to provide guidance in determining the best way to hold real estate investments and to assist those that find themselves in a poor tax situation. |
|
|
[打印]
|
| |
|
|
| Mark the milestone of 100 eviction cases today.... |
2012-02-21 10:14:55 |
|
|
So you want to be a landlord? eviction counts Feb 2012 update.
haha, today, we mark the milestone of 100 actual eviction cases, I know it is depressing..
the good news is, we collected 41 out of the 100 cases...
currently Under Eviction 1
waiting on judgment on back rent/damage 1
pursuing collection 19
paying or under garnishment 15
civil warrant ( dead beats ) 11
Case pending due to no-serviceable address 3
Case pending due to defendant in jail 3
Case dismissed due to death 2
Case dismissed due to bankruptcy 4
Case paid or settled 41
Eviction count by year
12 01 out of 134 units (so far)
11 31 out of 134 units (26 actual evictions, 5 back rent & damages)
10 11 out of 94 Units
09 9 out of 94 Units
08 8 out of 93 units
07 9 out of 78 units
06 8 out of 72 units
05 3 out of 28 units
04 4 out of 16 units |
|
|
[打印]
|
| |
|
|
| Rent Update, Jan 2012, 12 vacancies, collected 89.3% |
2012-02-07 10:37:14 |
|
|
January, virtually didn't change any compare to December, we gain a few then lose a few, no sign of actual rent roll improvements, which give me a pessimistic view of this year.
Usually, Jan/Feb/March are good months for us, lots of activities during these three months, but so far, nothing is really happening.
People still prefer SFH compare to apartment living. We begin to discount some rent on the new complex, hoping to fill few more units.
and I am facing some big challenges in other RE fronts, I may end up losing 500k this year.
For January, we closed the month with 12 opens.
SFH + Duplex (44 units), collected 96.8%, 1 opens.
Commercial Office Park (10 units), collected 90%, 1 opens.
Apartment Complex (40 units), collected 91.8%, 4 opens.
Partnership Complex (40 units), collected 77.2%, 6 opens.
07/09 97.5%
08/09 95.4%
09/09 88.7%
10/09 91.6%
11/09 95.1%
12/09 92.5%
01/10 97.6%
02/10 104.6%
03/10 94.55%
04/10 90.3%
05/10 106.8%
06/10 93.4%
07/10 97.5%
08/10 93.8%
09/10 99.15%
10/10 100.8%
11/10 91.8%
12/10 89.9%
01/11 90.3%
02/11 95.6%
03/11 100.2%
04/11 98.44%
05/11 101.3%
06/11 97.06%
07/11 SFH 89.65%, Office 100%, Apt1 94%, Apt2 80.4%.
08/11 SFH 90.1%, Office 100%, Apt1 101.9%, Apt2 80.7%.
09/11 SFH 98.3%, Office 90%, Apt1 94%, Apt2 91%.
10/11 Overall 89.9%, SFH 90.9%, Office 90%, Apt1 90.9%, Apt2 86.6%.
11/11 Overall 92.4%, SFH 95.7%, Office 90%, Apt1 100.2%, Apt2 79.8%.
12/11 Overall 87.7%, SFH 94.9%, Office 90%, Apt1 90.5%, Apt2 77.5%.
2011 Year End, Overall 93.2%.
01/12 Overall 89.3%, SFH 96.8%, Office 90%, Apt1 91.8%, Apt2 77.2%. |
|
|
[打印]
|
| |
|
|
|
|
