Hello DG Members,
I had an opportunity this weekend to stop at several open houses in my area. I enjoy open houses for several reasons including seeing properties, meeting other real estate agents and gathering opinions and information. I have a mission when I go into an open house and for every question the real estate agent that is hosting the open house has for me, I try to get in three questions answered by them. I also enjoy FSBOs because they can give you a perspective on a neighborhood and their selling points.
The best advice I can offer someone is verify all the information you hear to be true when looking at a home or multi-unit property. This would include, but not be limited to, the following:
- price of the home compared to comps in the market
- age of big ticket items such as roof, furnace, central air, plumbing, electric etc.
- on multi-units verify expenses and historical numbers the current owner provides. Always request a copy of their most recent "Schedule E" from their tax return or appropriate summary page for the respective multi-unit property you have an interest in because you can then have a good summary of the actual rents and expenses paid during the year. Sometimes sellers want to provide numbers with no support to verify the numbers. Thus, the tax return should be the most accurate information you can receive.
- verify current property tax and try to find out if taxes are due for an increase
- verify water bills are paid before closing because a water bill usually follows the current owner of the property
I hope this helps. Good luck finding those deals and don't forget to trust but verify the information! Believe and Achieve! - Joe
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Joe Jurek CPA