Apartment (fees, construction, properties, lawyer)

[Bseven]

I did a search to try and find this but I didn't see any information, so I figured I could ask the question and if you know of any previous threads you could direct me to them.

I wanted to either buy a building and turn it into an apartment or build one. But I'm not sure about what kinda of licenses and permits I might need to get for running an apartment building. Actually any information about owning and operating an apartment building would be very helpful. Many of you might tell me to get a lawyer but I like to try and learn on my own a little before going to a lawyer. Thank you in advance and thank you for your time.

[DMenscha]

The most important thing about "turning a building into an apartment" is if the resulting building will be in compliance with the zoning code. If you build from scratch, you will have to build on a properly zoned parcel and comply with the local building code and pay permit fees to the appropriate authority. You may also need a business license in your locality.

Residential income property is a business which operates 24/7/365. Depending on the size of the apartment you may need to hire a resident manager and by all means I encourage you to hire a professional property manager.

[stevep]

As DMenscha mentioned, you definitely want to talk with your local zoning department. Have you ever owned any rentals before, because if you haven't, you'll also want to set up an s-corp, llc etc to run the business through. Also, you didn't mention if you have any experience in building or renovating properties. If you don't, it might end up being cheaper and a lot less headaches purchasing an existing apartment building, because you won't have to go through the entire approval process which easily could take months. Also, you probably would get financing easier with an existing building vs. renovations or new construction........ and even more importantly, with an existing building, if you purchase it already rented, you'll receive rental income immediately vs building/renovating where you're spending money on construction/renovations and ending up with a negative cash flow until the property is completed.

[Bseven]

While i've never had an actual job building or renovating, I did work with my grandfather often during the summers at his construction business and do little projects on my own around the house nothing major. Thanks for your advice. But does anyone have any input about after the construction process more towards what needs to filled in order to rent it out, maybe what type of licenses I need for this type of business. I own other businesses and have just always wanted to get more into real estate and I feel that this is the better option for me espically since I'm in an area that could really use one.

[stevep]

You really need to check with you local city hall. Where I own rental properties, the city/state doesn't require you to have a license, but my properties are registered with the city as approved rental properties and are inspected every 1 1/2 years. But in another city where I'm currently living, they require you to have a business occupational license if you're running it as a business.