Need serious opinions on this woodbridge condo please.

[AW]

I know someone who has IO on investment property so no tenant principal paydown benefit....

 

[YellowFever]

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[YellowFever]

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[Irvinehomeseeker]

You are right and that is why i am suffering negative cash flow on the portola spring tri-level monster condo i bought, the HOA + Mello eats up $615/month and its rented at $2750, so i am loosing $5000/year minimum (EXCLUDING the vacancy and repairs - which can increase the negative cash flow to $12000+/year) = definitely not worth it, i am contemplating selling it and WILL NEVER EVER buy an investment property with HOA & Mello

Will 1121 sqft fit your future needs?  You mention buying something bigger down the road.  How soon do you think that would be?  IMO, I'd want 1400sqft+ and a garage in a 3 bedroom but that will cost you at least $550k.

IMO:  As a rental property, it's probably not worth it after HOA + taxes compared to other properties.  At least, that's what I'm told.  HOA+taxes is going to eat $900/month.  Add another $200/month for maintenance and stuff that you will need.  If prices were going to shoot up, then yes it's a good reason to invest in, but they already shot up and I think future price increases will be less significant.

Have you taken into account the principle amount paid by tenant?

Principal amount paid by tenant? I call that as rental income which will be declared in my taxes, how does that gain me any benefit? All i know is that the interest i am paying in mortgage is tax deductible.

I thought only the mortgage interest for a primary residence is tax deductible.  Can one use the mortgage interest from a rental to reduce taxes?

 

[OCLuvr]

You are right and that is why i am suffering negative cash flow on the portola spring tri-level monster condo i bought, the HOA + Mello eats up $615/month and its rented at $2750, so i am loosing $5000/year minimum (EXCLUDING the vacancy and repairs - which can increase the negative cash flow to $12000+/year) = definitely not worth it, i am contemplating selling it and WILL NEVER EVER buy an investment property with HOA & Mello

Will 1121 sqft fit your future needs?  You mention buying something bigger down the road.  How soon do you think that would be?  IMO, I'd want 1400sqft+ and a garage in a 3 bedroom but that will cost you at least $550k.

IMO:  As a rental property, it's probably not worth it after HOA + taxes compared to other properties.  At least, that's what I'm told.  HOA+taxes is going to eat $900/month.  Add another $200/month for maintenance and stuff that you will need.  If prices were going to shoot up, then yes it's a good reason to invest in, but they already shot up and I think future price increases will be less significant.

Have you taken into account the principle amount paid by tenant?

Principal amount paid by tenant? I call that as rental income which will be declared in my taxes, how does that gain me any benefit? All i know is that the interest i am paying in mortgage is tax deductible.

I thought only the mortgage interest for a primary residence is tax deductible.  Can one use the mortgage interest from a rental to reduce taxes?

As far as I know, mortgage interest, taxes, hoa all are tax deductible.

 

[riznick]

Let's change the perspective a little.  What if I told you guys to invest $6,000 a year into some 'mutual fund'.  In the first year if you try to withdraw it all, you get $70 bucks back.  In the second year, you get $332 back, in the 3rd year, you get $606 back... and on and on..until year 30, you get $20,772 back.  So as long as you don't touch the money you WILL keep getting paid back at anytime you wish to 'cash out'. 

Hey, this behaves sort of like a 401k !  ;D

Right, it's a positive investment in the long term.  Depending on your goals, it may be a good choice. 

Other considerations:
1. You will need to put in $200k up front. (con)
2. You can sell the property for a lot more in the future. (pro)
3. Rent will go up over the years (pro)  Eventually this will be cash positive.
4. If your investment is purely financial, there are better options that will get a better ROI.
5. The HOA isn't a complete money suck.  Some of the HOA costs may be beneficial.  Many of the HOA's take care of the exterior of your home (gardening, roofs, fences...).  Those would be out of pocket costs without the HOA. 

 

[potsticker]

You are right and that is why i am suffering negative cash flow on the portola spring tri-level monster condo i bought, the HOA + Mello eats up $615/month and its rented at $2750, so i am loosing $5000/year minimum (EXCLUDING the vacancy and repairs - which can increase the negative cash flow to $12000+/year) = definitely not worth it, i am contemplating selling it and WILL NEVER EVER buy an investment property with HOA & Mello

Will 1121 sqft fit your future needs?  You mention buying something bigger down the road.  How soon do you think that would be?  IMO, I'd want 1400sqft+ and a garage in a 3 bedroom but that will cost you at least $550k.

IMO:  As a rental property, it's probably not worth it after HOA + taxes compared to other properties.  At least, that's what I'm told.  HOA+taxes is going to eat $900/month.  Add another $200/month for maintenance and stuff that you will need.  If prices were going to shoot up, then yes it's a good reason to invest in, but they already shot up and I think future price increases will be less significant.

Have you taken into account the principle amount paid by tenant?

Principal amount paid by tenant? I call that as rental income which will be declared in my taxes, how does that gain me any benefit? All i know is that the interest i am paying in mortgage is tax deductible.

I thought only the mortgage interest for a primary residence is tax deductible.  Can one use the mortgage interest from a rental to reduce taxes?

As far as I know, mortgage interest, taxes, hoa all are tax deductible.

You can use mortgage interest, property taxes, HOA, maintenance costs, management fees, etc as expenses to reduce the tax liability from your rental income. This would all be populated on Schedule E. Keep in mind rental income is considered "passive income" and the deductions phase out as your income rises.

 

[YellowFever]

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[Irvine Dream]

  With rental income, you can screw around with the paper and pay little taxes and write off all sorts of stuff.  Generate fake receipts like in Breaking Bad tv show with the car wash business ;D

The IRS does not come knocking on your door to check if you spent $6 grand on that new furnace.  However, you can always go to the SGV valley to find a dude who'll write you a fake invoice.  ;D

Yellowfever you are very street smart.  Hope you stay out of trouble and jail

 

[eyephone]

  With rental income, you can screw around with the paper and pay little taxes and write off all sorts of stuff.  Generate fake receipts like in Breaking Bad tv show with the car wash business ;D

The IRS does not come knocking on your door to check if you spent $6 grand on that new furnace.  However, you can always go to the SGV valley to find a dude who'll write you a fake invoice.  ;D

Yellowfever you are very street smart.  Hope you stay out of trouble and jail

What a statement! This is coming from a model citizen that tracks people on TI? jk 

 

[YellowFever]

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