Question: I am a new real estate investor. The homes that I rent out are owned by my LLCs. I want to deed my principal residence to a LLC, pay rent, have the LLC make the mortgage payments, pay the taxes, water bill, etc. Two CPAs have told me that I cannot do this because I am evading taxes. I believe that with the proper creative and can-do approach, one can do anything. What do you say?

Answer: Two CPAs have said that what you propose cannot be done. I suspect their reasoning concerns self-dealing. Whatever the case, the purpose of engaging CPAs is to take advantage of their training and experience.

Imagine if everyone could get a $14.95 instant LLC kit from a late night infomercial and make their residence into a commercial property with bigger deductions. Wouldn't everyone do it if such a thing were a plausible and acceptable concept?

If you really want to pursue this matter, send a letter to the IRS and ask them to rule in favor of your proposal in advance. Until you receive such a letter, listen to your CPAs.

Also, if you change the title will your current financing become immediately due and payable? Will you owe transfer taxes? Etc.

Question: I'm wondering about the dollar valued added to property by having a homeowners' association. My association is quite small, only nine homes. The typical property value is in the $200,000 range.

One homeowner runs two businesses from his home, with a large truck plus pickup and trailer attached, in violation of the HOA restrictions.

As President of the HOA, I am requesting any information you have that would guide me in estimating either or both: (1) the valued added by having a homeowner's association; and (2) the typical reduction in property value when an otherwise business-free, residential only HOA finds that a business is openly and obtrusively being run in it.

Answer: These are unanswerable questions, because one would need to first know what the HOA actually does, other than perhaps object to someone who has a home-based business.

You have a community with nine homes. Do you really want to start a fight? How many of the homeowners conduct business via a computer from their homes? Is such conduct banned under a broad "no business" rule. Do you have the dollars for legal fees? Do you have liability insurance for individual HOA officers?

Is this really a problem? If you have not enforced the rules to this point have you actually grandfathered in the homeowner with the trucks? Why not speak with your members before going further.

Question: My mother has a commercial property that has been rented out for many years. The current renter is moving out but has brought along a new renter to buy out his stock. The new renter has had our lease agreement for six weeks and is stringing this out -- how long do we need to wait for his answer before going to another renter?

Answer: Are you required to continue the lease? Have a local real estate attorney review the documents and provide advice.

If you are not obligated to continue the rental, then explain to the new renter that if you do not have a positive response to your proposal by a given date you will begin looking for alternative tenants.

Question: I reside in California. A friend in New Mexico wants me to invest in real estate there. I am planning to invest in Los Angeles and also thinking about Albuquerque (if you know a better place in New Mexico than Albuquerque than let me know). Also, I need investment recommendations for other estates or cities like Austin.

Answer: It's difficult to manage properties from a distance and unwise to buy in areas where you are not familiar with local communities and neighborhoods. You need to be practical. Perhaps explain to your friend that you expect to start investing in areas within an hour of your home so that you can physically oversee the property and also learn more about investing. As a place to begin, speak with local brokers in your community.

Question: I own a radio communications tower adjacent to my home. I have recently received inquiries from interested buyers and I am wondering how to determine the market value of this tower. I assume it is some multiple of the income generated from the site, but can you help me determine the multiple or other formula I would use.

Answer: The income approach makes a lot of sense, but you need to know the rate for an acceptable level of return. Another idea is to search the Internet to find other sales, past sales and appraisers who have previously valued towers.

Question: I'm currently living in Ohio, and about to relocate to Georgia. What's the best move? Sell my house or rent it out. And if I decide to rent out, how do I go about getting started, or what steps do I have to take to begin this process?

Answer: Would the sale of your home create a significant profit? If yes, then you are most likely to be best served with a sale and cash in hand rather than a long-distance rental.

However, it may be that local market values are going up and that there's a case for selling in a year or two -- long enough to catch additional appreciation and get some rental income yet short enough to still have resided in the property for two of the past five years and thus qualifying for the residential capital gains write-off. For specifics, speak with local brokers and get information from a tax professional.

Question: We purchased our condo last year and while in the process I noticed that the paperwork said we were buying unit 19, although we had been looking at unit 20. After further investigation we found out that back when they built them in 1985, the builders put the wrong unit numbers on four of the units. Everyone including my real estate agent and supposedly his real estate lawyer said it is no problem.

The property had been bought and sold numerous times and everything should be fine. The parcel number that I pay taxes on is unit 19, my deed and mortgage say 19, but my door says 20. I want to fix this, but the property management people for our association are telling me I can't. I am in desperate need of advice.

Answer: Are you in the unit that you thought you were buying?

As you may have a title problem, speak with the party that provided title insurance.

Is it possible that the title paperwork is correct, but only the door is wrong? If the only issue is the number on the door -- if the title is otherwise correct -- then it may be discomforting but okay from a title perspective. That said, unless there is another unit "19" in the project why does anyone care what number you put on the door? For specifics, speak with a local real estate attorney.

Question: I listed my condo in Florida with an agent, a listing which is to continue until mid-September. However, he has not shown the unit at all and I haven't heard from him in over two months. Can I withdraw my condo from him and does that cancel the agreement?

Answer: A contract is an agreement between two parties. Unless there is some written provision which allows you to unilaterally end the agreement without cost or penalty, then you cannot terminate the listing contract early without agreement from the other party.

Given the decline in the condo market in certain parts of Florida it may well be that a property is not shown for an extensive period. That said, an agent should be responsive to client inquiries.

To resolve this matter, contact the agent's broker or office manager. If they are not cooperative, explain that you will have to ask the Florida Division of Real Estate to examine the situation.

Question: A friend of mine will be selling his home. The home needs a new roof. He wants to do an overlay on top of the old roof. I told him that I thought it might be best to remove the old shingles and lay a new roof instead. I just do not know if lenders will approve of an overlay or not, or if an insurance company would insure the home with two layers of roofing. Is it okay to add a second layer of roofing?

Answer: The issue with roofing material is weight. Roofing is heavy and too much can cause a roof to sag and leak (or worse), especially when snow and ice are added. For this reason the amount of roofing is limited. Typically two layers are okay, but not more.

For specifics, contact your community building inspection office and ask them what's allowed under the local building code. Construction up to code should not present an issue to either lenders or insurers.

Question: I'm currently looking into becoming a real estate agent. From what I have read, though, there seems to be many more warnings than there are success stories, especially for new agents. Are there any drawbacks or potential risks for new agents joining a team verses a larger company or franchise company? Should joining a team be the first option?

Answer: As a new agent your first effort should be to associate with an experienced agent, team, group, broker or whatever or whoever will teach you the practical aspects of brokerage. You might consider working as an assistant to the most successful agent you can find as a way to start.

As to rumors regarding success and failure, real estate brokerage is a competitive business with a large number of licensees chasing a limited number of transactions. Some licensees fail, and some do very well. How you will do depends on your education, experience, abilities and marketing.

Also, about rumors. One way to discourage competition is to start rumors regarding how hideously difficult it is to be successful in a given business. For instance, I heard a rumor that the average hedge fund manager makes less than $1,400 a year and lives on roots and berries picked from public parks ... .

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