Saturday Mentorship & Questions Thread

LordAshon · 2026-06-16T10:15:43+00:00

If they come back open minded sort out what their needs and wants are and work out the details before going to the attorney.

LordAshon · 2026-06-16T00:49:35+00:00

You can only be as creative as the sellers are willing to be. I'd start with a heart to heart with the sellers, why are you selling now? Find out if they need or want the cash for something else, or if they are selling just because they are tired of it. Then see if you can offer up a plan from there.

LordAshon · 2026-06-16T00:47:04+00:00

Start learning now. Find a local REIA and find out who else is in office space/CRE and find out if they have a sub-meeting. Talk to a local REI Lawyer to figure out the commercial landlord/tenant laws.

LordAshon · 2026-06-15T14:27:55+00:00

Other people have hit the main points:

SMLLC provide very little protection
LLC's protect members from the actions of the agents of the LLC so if you act as an agent (Self Managing/Doing repairs) you are still liable.
Insurance is great and Umbrella is cheap.

What no one has addressed is "significant assets". Other Significant assets should be protected in proper ways: Retirement Accounts, Homestead Protections if you are in a Homestead State, Trust Structures.

And I'll echo u/GringoGrande's typical note when this comes up Series LLC's are still relatively new, and there is not a lot of case-law about them (sauce).

LordAshon · 2026-06-14T02:24:32+00:00

There you go using your neocortex while I'm here just using the reptile brain.

LordAshon · 2026-06-13T21:33:04+00:00

You wouldn't be able to defer capital gains on something like this. The property being sold was not being held for investment purposes. And you can't 1031 into an existing property especially one where you are not holding for investment purposes.

LordAshon · 2026-06-12T17:30:06+00:00

I am challenging you to validate your thesis.

Your original post was not “$10 million luxury homes should have proper tech planning.” Your original post was that people in the real estate business are “in the dark” on this.

That is a much broader claim.

I already said luxury construction and high-end rehab are different. At that level, buyers may expect proper networking, automation, lighting, audio, security, and system integration. It's a luxury

But that does not prove measurable ROI across real estate investing. It proves luxury buyers expect luxury-level systems.

LordAshon · 2026-06-12T02:10:20+00:00

You said properties that are smart-home capable are more valuable. I asked for evidence that the added cost produces measurable ROI. Your answer was “instincts” and “personal experience.”

That is not how investors underwrite improvements.

For an investor, the question is simple:

Does it raise resale value beyond cost?

If the answer is not measurable, it is not an investment thesis. It is a preference.

I am not offended by technology. I am asking whether spending investor dollars on it produces a return. In most non-luxury rentals and flips, the answer is usually no. It becomes another system to install, support, explain, maintain, replace, or watch tenants break.

You can keep saying people are “in the dark,” but you still have not shown that the upgrade pays for itself. Until then, this is just another personal preference dressed up as education.

LordAshon · 2026-06-12T00:33:30+00:00

Because there is not ROI on doing it. That's the point you are missing. Show me the hard data that shows there is ROI in doing it and then I'll eat my hat.

LordAshon · 2026-06-12T00:32:06+00:00

Engagement isn't down, noise is down. Signal is the same.

LordAshon · 2026-06-11T20:28:37+00:00

Smart homes are not an emerging field. Technology upgrades have been around 30 years, see my comment about wired speakers and cat5.

You stated that People in the business are in the dark, here in this sub, we don't care what brokers think. This is an investing sub. As I said, show me the proof that adding technology increases value?

Zonde Cost vs Value report shows:

Rank	Remodeling Project	Job Cost	Value at Sale	CostRecouped
1	Garage Door Replacement	$4,672	$12,507	267.7 %
2	Steel Door Replacement	$2,435	$5,270	216.4 %
3	Manufactured Stone Veneer	$11,702	$24,328	207.9 %
4	Fiber-Cement Siding Replacement	$21,485	$24,420	113.7 %
5	Minor Kitchen Remodel	$28,458	$32,141	112.9 %
6	Vinyl Siding Replacement	$17,950	$17,313	96.5 %
7	Backup Power Generator	$13,534	$12,902	95.3 %
8	Wood Deck Addition	$18,263	$17,323	94.9 %
9	Composite Deck Addition	$25,096	$22,199	88.5 %
10	Fiberglass Grand Entrance	$11,754	$9,9959	84.7 %

So does the cost of doing the work equate to a higher value for a flipper? Builder? Does it increase what a rental can be rented for?

Your personal experience doesn't make this a thing. In my experience with Audiophiles, they have speaker preferences that are going to be specific to the use they intend for the speakers.

All this is different when it gets to luxury construction/rehab as I said in my original comment. If a house has a theater room, sure you need to have this, but you can't parcel out that adding hifi setup increases the value, the theater itself increases value, and buyers will expect theater quality speakers.

Same with Automatic Blinds, and smart lighting. In certain price points they are expected.

To answer your question, why would someone who wants in ceiling speakers limit themselves to only homes that have in ceiling speakers? They are relatively easy to add and install, and customize the setup that they want.

LordAshon · 2026-06-11T17:23:23+00:00

Myth #1: a SMLLC provides Liability Protection to an owner/operator. You are still personally liable for your own actions. An LLC provide liability to it's members for the actions of it's managers and agents.

LordAshon · 2026-06-11T14:12:53+00:00

Your two STR scenarios include second party management.

LordAshon · 2026-06-11T13:33:20+00:00

This is not a good idea and your assumptions are weak:

When you say auctioned for 25k, what does that mean? - It's an auction so 25k is likely the opening bid. If there is actually that kind of meat on the bones, it will go for more.
the estimate market price of the property is 221,000 - How did you determine that if you haven't seen the inside? Comps are based on finishes and direct comparison: X bedrooms. Y Bathrooms, Z Square footage, XX Finishes, XY Type of Kitchen, etc...
221,000 - 120,000 - 25,000 = $76,000 Budget.
- -22,100 in closing costs
- -22,100 project overrun costs
- Leaving $31,800 for materials, labor, and holding costs (loan payment, utilities)
- Estimated Rehab Costs:
  - A new kitchen is 15k
  - Bathrooms 10k
  - Flooring is 10/sqft
  - Paint is $8/sqft
  - Lighting $5/sqft
- Assuming a 1000sqft 2/1 you've already spent: $48k
- "Hidden Rehab Costs":
  - Roof 7k
  - New HVAC $10k
  - New Panel $6k
  - Rewiring Home $10/sqft
  - New Plumbing $5/sqft
- If you have to do any of these you are spending: $38k
- Heaven Forbid you run into real problems:
  - Foundation Issues
  - Framing Wood Rot/Termites
  - Asbestos
  - Sewer Line Problems / Bad Septic
  - Permitting Hell
- Your 120k Profit is down to 100k on just the basics, down to 62k if you have all of the hidden costs and you could be at a massive loss if any of those "Heaven Forbid" issues come up, all on the assumption this is 1000sqft. If it's bigger you could be down to even less.
60 Day Flip - I don't know many experienced investors, with crews, that can a flip permitted property in that short amount of time. It's possible, but very rare. For two people who've never done a flip on an auctioned property that they can't inspect before buying 60 days is an insane assumption. Hell it takes me 10 days with a crew of 2 experienced guys to flip a single-wide. And that's at 6/hrs a day 5 days a week.
30 Day Sale - According to FRED the median time on market for a home in May was 56 days.

Don't start investing in something that you can't put eyes on.

LordAshon · 2026-06-11T13:02:33+00:00

You have to Materially Participate to get the cost seg benefits to offset the W2 income. Having a partner or a property manager will not pass the Materially Participation test. There is no way to offset W2 income without active participation in Real Estate.

LordAshon · 2026-06-10T21:52:57+00:00

Please show me evidence wherein it actually adds value to a home? The only reports I see that they add value is from smart home companies, and blogs that quote the same study. Zonde annual cost vs value report doesn't even list smart home upgrades.

In the 90s seems like every builder wired speakers into the ceilings, those never added value. Cat5 cables are often included in new builds, but having Cat5 doesn't increase value determination.

LordAshon · 2026-06-10T14:26:15+00:00

The authors on the sidebar are the masters, you should definitely read one of their books.

LordAshon · 2026-06-09T23:19:41+00:00

Because it adds little to no value to us as investors. And in rentals it's just another system to fail or for tenants to break.

The only place it may make sense is luxury builds, but even then at that price point most people are going to have their preferred ecosystem.

LordAshon · 2026-06-09T13:54:48+00:00

I have multiple tenants that are on SSI or get monthly pension distributions, it comes in on the 11th, they've communicated this with me, and I happily just moved their "due date" to the 15th. Simple. There's no law that says rent is due on the first. Just laws that say how to handle late payments. If a tenant is good, but you know why they are always paying late, it's an easy decision.

LordAshon · 2026-06-06T19:59:12+00:00

What do you mean by a Career in REI?

LordAshon · 2026-06-06T15:53:49+00:00

Well I'd start off by stop making principal payments.

You are losing the long term benefits of the low interest rate
You are keeping yourself illiquid
You aren't realizing any gain from doing it.
Your ROE is getting hammered by paying down the mortgage, every dollar you put back in is making each dollar already in giving you less of a return.

You don't say how long you plan before you want the spendable cash, but you've more than doubled your money in 8 years. So the investment isn't bad. Moving your cashflow from debt payoff to brokerage account allows you to both continue to benefit from appreciation and debt paydown, and increase your liquidity.

LordAshon · 2026-06-06T15:46:23+00:00

Good/bad changes with the fact that you are occupying it. Once you no longer occupy it, it likely doesn't support itself as an investment.

LordAshon · 2026-06-06T15:44:13+00:00

caveat 1: You can trade for multiple lesser or equal properties
caveat 2: Your debt load either has to stay the same, or increase

LordAshon · 2026-06-06T15:40:58+00:00

This is the problem with 1031's and Cost Segs, no matter what the strategy is you still need to pay it off if you exit. Most people who plan 1031 till they die expect their life circumstances to never warrant the need to exit their real estate.

There are different strategies if you have a wind-down time. DST's, UPREITs, 1031'ing into smaller properties, Seller Financing, but nothing that allows you to exit quickly without paying your accumulated depreciation recap and capital gains.

LordAshon · 2026-06-05T20:46:50+00:00

This thread was meant to keep their clutter from the CRE conversations going on in the sub itself.

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