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Old 12-22-2018, 11:52 PM
 
Location: Formerly Pleasanton Ca, now in Marietta Ga
4,425 posts, read 3,565,345 times
Reputation: 6102

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I can agree with some of the points brought up about Asheville. A woman I know here in Atlanta bought a place on the outskirts there. She didn't have that much money but convinced herself that it was a good investment ( it wasn't but she justified it to herself). It's about a 5 hour drive Last year she spoke pretty positively about it. This year not so much. I would say she spends about maybe 3 weeks a year there total. She actually loses money on it so it was a bad investment. I told her to rent it out but she is maybe a half hour out of the downtown and gets kind of lonely there.

If you get a chance fly out and take a road trip in the area. I think there are lots of nice places to live that could fit your budget. I am quite happy here in Marietta. I'm just about 20 minutes to Atlanta and have all the amenities and shopping I want. I would easily stand it up to Pleasanton and the Tri valley back in Ca except houses are way less.

Because so many houses here in the south have walk out basements, you can easily househack. I pay 1850 for my mortgage for a 5000 sq ft home but rent out my basement which is a full 1000 sq ft apartment with seperate entrance and parking for 950 so that cuts my mortgage in half and I still have 4000 sq ft and 5 bedrooms with 5 baths. Plenty of room if you bought a setup like this for you and your mom to share without stumbling into each other. The other option is for me to live in the apartment and rent the house for about 2400 to 2600 a month thus living free.

Take your time and explore your options. Good luck
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Old 12-22-2018, 11:54 PM
 
Location: Formerly Pleasanton Ca, now in Marietta Ga
4,425 posts, read 3,565,345 times
Reputation: 6102
Quote:
Originally Posted by karen_in_nh_2012 View Post
OP, when you say you "may very soon have the opportunity to buy" -- what, exactly, does that mean? Do you have a property in mind that you and only you know about so you're getting a great deal? Sorry, but that wording is very odd. What exactly is the "opportunity" that is coming your way?

I live in New Hampshire and became what some call an "accidental landlord" 6-1/2 years ago when I bought my current house but did not sell my previous house. The HUGE points are that (a) my previous house is only about 10 minutes away from my current house, which takes away the "long-distance landlord" problem, and (b) I had renters with a signed lease BEFORE I bought my current house (actually, that was a requirement for buying my current house as it would have been difficult to qualify while having to pay for 2 mortgages). I have been VERY lucky in that I've had generally great tenants who pay their rent on time, don't cause damage, etc. Alas, that's not always the case.

I did not have to go through any special qualification in order to convert my previous house to a rental, but that was mostly because I had lived there for 9 years. Normally the down payment requirements, income requirements, and interest rates are different (i.e. much more stringent) for investment properties than for owner-occupied properties. It sounds like you know SOME of this, but I am a bit skeptical given that you are thinking about buying a property that is 3,000 miles away?

So can you please clarify exactly what you mean by your "opportunity" to buy something out of state? (I don't see anything in your later posts that cleared that up.) Honestly, I would NEVER be a long-distance landlord -- having to hire a property management company is (or can be) very expensive PLUS usually eliminates the possibility of tax benefits from being a LL (because you are not "active" any more -- you have hired someone to do the work for you). I DO understand the desire to own property -- honestly, owning my own house is one of the very few things in life that has been as good as I had hoped for (as opposed to all those things that SEEM like they are going to be great but turn out not to be!). But it's not for everyone. For a lot of people, renting makes more sense.
All very good points, but I disagree about losing the tax benefits when you have a property manager. You will still get them. expenses, depreciation, etc.
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Old 12-23-2018, 05:09 AM
 
15,871 posts, read 18,767,858 times
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I would suggest that you look into moving and teaching where ever it is that you'll buy your home. Why wait? Look at the cost effectiveness of moving, vs. what it costs you to continue working and paying rent in a very high cost area.

You'll also be avoiding the pitfalls of being a long distance landlord which can be stressful and very expensive.....not to mention risky in today's business climate. One bad renter could cost you a fortune or even the home.

The other pluses, you could have your mom move there now, with you....You could do your animal shelter now....even while continuing to work if you are in a location near enough to commute.

Life is short, if you have worked hard enough to achieve buying your dream home/situation now.....then start living it now.
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Old 12-23-2018, 07:33 AM
 
Location: Southern New Hampshire
6,832 posts, read 11,974,698 times
Reputation: 19926
Quote:
Originally Posted by aslowdodge View Post
All very good points, but I disagree about losing the tax benefits when you have a property manager. You will still get them. expenses, depreciation, etc.
Sorry, I should have been clearer. I was thinking specifically of being able to deduct your (paper) losses from your regular income -- you can only do that if you are an "active" LL. But you are right, you don't "lose" the other benefits!

Quote:
Originally Posted by JanND View Post
I would suggest that you look into moving and teaching where ever it is that you'll buy your home. Why wait? Look at the cost effectiveness of moving, vs. what it costs you to continue working and paying rent in a very high cost area.

You'll also be avoiding the pitfalls of being a long distance landlord which can be stressful and very expensive.....not to mention risky in today's business climate. One bad renter could cost you a fortune or even the home.

The other pluses, you could have your mom move there now, with you....You could do your animal shelter now....even while continuing to work if you are in a location near enough to commute.

Life is short, if you have worked hard enough to achieve buying your dream home/situation now.....then start living it now.
This is great advice except the OP is a college professor and it sounds like she's an adjunct (OP, correct me if I'm wrong!), which is not a highly secure position and often comes with no benefits (many college professors work 2 or 3 or 4 part-time adjunct jobs to try to scrape together a living -- it's a horrible system). Unfortunately, the tenure-track academic job market is pretty awful in most fields -- hundreds of well-qualified applicants for every position -- so you usually take the best offer you get (which might very well be the ONLY offer you get, if you get any at all). This means moving to wherever the job is and staying there.

If she could get a tenure-track job in a state she wants to move to, that would be terrific.
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Old 12-23-2018, 09:28 AM
 
Location: Formerly Pleasanton Ca, now in Marietta Ga
4,425 posts, read 3,565,345 times
Reputation: 6102
Quote:
Originally Posted by karen_in_nh_2012 View Post
Sorry, I should have been clearer. I was thinking specifically of being able to deduct your (paper) losses from your regular income -- you can only do that if you are an "active" LL. But you are right, you don't "lose" the other benefits!



This is great advice except the OP is a college professor and it sounds like she's an adjunct (OP, correct me if I'm wrong!), which is not a highly secure position and often comes with no benefits (many college professors work 2 or 3 or 4 part-time adjunct jobs to try to scrape together a living -- it's a horrible system). Unfortunately, the tenure-track academic job market is pretty awful in most fields -- hundreds of well-qualified applicants for every position -- so you usually take the best offer you get (which might very well be the ONLY offer you get, if you get any at all). This means moving to wherever the job is and staying there.

If she could get a tenure-track job in a state she wants to move to, that would be terrific.
Actually I think you can deduct the paper losses against your regular income too. Perhaps a cpa can jump in here. I’m pretty sure I’ve been doing it.
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Old 12-23-2018, 11:19 AM
 
Location: Southern New Hampshire
6,832 posts, read 11,974,698 times
Reputation: 19926
Quote:
Originally Posted by aslowdodge View Post
Actually I think you can deduct the paper losses against your regular income too. Perhaps a cpa can jump in here. I’m pretty sure I’ve been doing it.
Hmmm ... before I started 6-1/2 years ago I did a TON of research and one of the qualifications for being able to deduct your paper losses was being an "active" LL. One of the "flags" for the IRS in determining whether you were "active" or "passive" was whether or not you had/have a property management company. I was advised NOT to get one (although frankly I wouldn't have anyway, with just 1 property 10 minutes away). That's probably not the ONLY "flag" for the IRS in making the determination, but it was one of them. Of course things could have changed in the past several years too!
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Old 12-23-2018, 12:36 PM
 
Location: Formerly Pleasanton Ca, now in Marietta Ga
4,425 posts, read 3,565,345 times
Reputation: 6102
Quote:
Originally Posted by karen_in_nh_2012 View Post
Hmmm ... before I started 6-1/2 years ago I did a TON of research and one of the qualifications for being able to deduct your paper losses was being an "active" LL. One of the "flags" for the IRS in determining whether you were "active" or "passive" was whether or not you had/have a property management company. I was advised NOT to get one (although frankly I wouldn't have anyway, with just 1 property 10 minutes away). That's probably not the ONLY "flag" for the IRS in making the determination, but it was one of them. Of course things could have changed in the past several years too!
I think the tax issues come about when people try to claim themselves as real estate professionals. There are strict means tests as to what constitutes a full time pro. I owned a lot of real estate but couldn’t see that much of an advantage to being labeled as such. Primary source of income, over 700 hours a year that was documentable I think,etc.

I’m pretty sure I wrote off all my loses against out of state rentals I had even though I had property managers against my earned income. I believe there are caps on that though per year if you are not a pro as well as how much you made from your job limitations. You probably made a lot more than me back then. The limits simply weren’t worth the hassle of declaring myself a full time pro.
I heard of one case where one guy claimed himself a full time pro with a very small portfolio but was able to back up everything the irs audited him on. Another person with a huge portfolio got nailed making the same claim when she said she was working on a rental and the irs found credit card charges she made in Paris.

I think some cpas are well versed in real estate taxes and others are not. I went through a couple before. I found a good one.
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Old 12-23-2018, 12:49 PM
 
Location: planet earth
3,503 posts, read 1,237,719 times
Reputation: 7717
Quote:
Originally Posted by KLC2018 View Post
Nobodysbusiness-

Thank you. What I mean is that I will either have to stay in the Bay Area and keep doing what I’m doing or leave here and go rent someplace I think I might want to buy. The daunting thing is that I will have to find new work, etc. Also, my landlord here keeps my rent decent for this area. If he decides to sell this place, I will have to find a place for myself and my dogs with likely an exponential rent increase and be at the mercy of another landlord. I didn’t want that. I guess I wish I were just ready to make a move to a place but I guess I’m not. I just wanted to have the house as a place that is mine that I can move into if I need (if I buy as a second home) that will hopefully appreciate in the meantime and be a place I can move and where my mom can retire. You see, my mom hasn’t owned a home her entire life. I don’t want that to be my life too.
I would still target the area where you think you would like to relocate, book a trip, and look at properties. If you find something you like, buy it, and rent it out.

Keep working in the Bay Area for however long you want.

You have nothing to lose, but if you give up, the dream is lost.
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Old 12-23-2018, 02:02 PM
 
9 posts, read 2,099 times
Reputation: 20
Thank you all again! There is no hurry. I can keep exploring and I think I probably should!! I have heard a lot of great things about Georgia actually! I think I just need to take a few more trips to really explore places.

Frankly, I have the ability to buy a home and move into it this summer. I just don’t think I’m ready to make the trek across the county with my four senior dogs.

Aslowdodge- thank you for the anecdote about your Asheville friend. I have friends out there that work in reality and that are real estate investors but I still think it might be tough if I don’t live that way. It’s an 8-hour trip from here to AVL and so I don’t know how much I would even get to use my own home. Another great point. Thank you!
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Old 12-23-2018, 07:15 PM
 
Location: America's Expensive Toilet
1,045 posts, read 687,937 times
Reputation: 2209
The fact that you don't own a first home is the reason I think you shouldn't be thinking about this home as an "investment." Because you state you have to work your butt off to live in the Bay Area, you need to look at this potential home as your home base. Being a long distance landlord is not fun, it can be time-consuming, costly, and difficult (think about adding that to your already complex Bay Area life). Look for jobs in the area you wish to buy your home and then move when you get an offer.
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