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Ever wonder why there are so many horse farms around the southern NC mountain towns of Tryon, NC, Rutherfordton, NC, Saluda, NC and Landrum, SC? Much of it has to do with the extended growing season associated with the Geothermal Belt located in the Area. This term was first documented and named after Silas McDowell of Franklin, NC in 1858.


A “thermal belt” is simply a zone or belt on a mountainside where frost or freezing temperatures are less likely to occur then at higher or lower elevations a position of obvious importance to farmers impacted by growing seasons. The highest elevations generally receive the coldest parts of weather patterns due to the reduction atmospheric pressure, however have you ever watched the weather on tv, if you live or visit the mountains when a meteorologist refers to radiational cooling factoring into valley frosts on cool clear nights? This happens regularly in the deep mountain valleys of North Carolina. This thermal belt sits between these elevations and is generally protected by higher mountains to the north and west.


As a result, these previously mentioned locations generally experience fewer frosts in the Spring season when blooming fruit trees are at their most vulnerable thus increasing the probability that the fruit will be able to be harvested in the Summer and Fall. Owners of horse farms consider this a benefit of determining where to locate their farms. In addition to the benefits of better harvests and more vegetation available to the reduced number of frosts, the animals are exposed to freezing temperatures less often then other locations.


The next time you travel through or visit this area and see these majestic animals running and feeding on the natural landscapes remember the term “Isothermal Belt” and you will know why you will see miles and miles of horse farms in these great regions of the Carolinas.






Updated: Feb 13

Owning a second home in the Carolina mountains can be sound investment--if you know how to find the right property management company.


One of the great benefits when deciding if you should invest in a 2nd home in the mountains of the Carolinas is to gain a better understanding of what rental income would look like and how much you should expect as a return on your investment.

If you do decide you want to generate income, you will want to first decide if you want to hire a property management company (PM) to manage the process or take it on yourself. There are many websites that make the later a less daunting undertaking. For example, many individuals are using Airbnb and VRBO to market their homes for rental purposes. These sites allow you to broadcast your home to a big market and you can pay page positioning for where your property would land (the more you pay the more eyes you are in front of). These sites also help manage availability calendars and have software to execute the transaction. While the fee is less than a traditional PM would charge there are still plenty of research to best compare fees and to gain an understanding what it can and not do.

Please note there will still be several things that would need to be considered in the process if using one of these sites. For example, who cleans the homes, how to manage repairs and communication with the guests including directions and property details that will fall on you as the homeowner to manage. A full-service PM would take most of these responsibilities on to allow the homeowner to have minimal time requirements in the rental process.

The market where PM's operate can vary from national scale to just one of the niche small towns in the area. You will find the national providers are lower cost (10%-15% on average) but may be limited concerning area expertise and niche services they provide, whereas smaller PM's can really make sure the experience meets the exact needs of the guests. The smaller PM's generally charge between 15%-25% of income generated.

Mountain Properties of the Carolinas has researched most of the property managers in the areas we sell and developed an understanding of their costs, occupancy rates, customer reviews, general core competencies and service areas. This allows us to make recommendations to our buyers of which companies might work best for the homes they are considering and what those returns generally look like.

Please let us help you with this process and to help you select the right company for your home if you decide to use your home as a short-term rental option!!



  • Mike Pocisk

Updated: Feb 13

As we quickly approach tax season I wanted to remind everyone what a powerful financial tool investment real estate can be as it relates to your wealth. Not only do you earn additional income from the rental property as it rents throughout the year you also gain a nice tax deduction to offset the income earned.


The are many expenses associated with purchasing and maintaining an invesment property that create tax advantages for owners. You will need to consult with a Real Estate Tax attorney to understand the full implecations of your investment as it relates to you but below are just some of the items that can be tax deducatble if you meet the occupancy requirements:


Depreciation

Depreciation is a rental property tax deduction for the hypothetical wear and tear on your building as if it were an expense. Note it does not cover the land portion of your investment. Even though you may not be encountering costs to cover actual maintenance expenses, accounting principles allow you to take advantage of the eventual costs through depreciation

Determing what the depreciation figure is vital, and you should turn to your certified public account (CPA) or tax professional for assistance. Generally, you can depreciate your rental property value minus the cost of land evenly over 27.5 years, known as straight-line depreciation.


Mortgage Interest Payments


Mortgage interest payment, points and loan origination fees may all be deductable. Your 1099 statement from your mortgage lender should provide the correct value to claim year over year.


Property Taxes


Property taxes paid either at closing or annually by you mortagge lender if you loan is escrowed or persnally if non-escrowed are also tax deducable. This information is also seen on the 1099 statement obtained by your mortgage lender.


Property Insurance


Any form of insurance is considered an expense, hence tax deductible for the rental building. This includes basic hazard insurance and special perils insurance like flood or hurricane coverage as well as liability insurance.

Typical types include:

Liability insurance, Hazard and fire insurance, Sewer backup insurance which can be added to your hazard policy. Flood insurance which covers water coming from any source outside the home and is required by most mortgage companies.


Utilities


Basic utilities such as Heating bills, electricity, gas, water, sewer, television and phone are all deducable expenses so keep track of these throughout the year.


Maintenance & Repair


Costs to maintain, care for, and improve the property are deductible. However, there is a difference between how things like cleaning, maintenance, and repair are deducted vs how improvements are handled.


Improvements


Whether you are upgrading your flooring, improving your appliances, power washing or whatever the task to impove the property the expenses to do such can be written off.


Cleaning


Needed between rentals however the costs to clan it up.......deducable.



Homeowners Association Dues


Not applicable for all investment propertys however if you have a requirment through covenents to pay accosiation dues these are deducable.



This is just to name a few. Call me to obtain a full list and to fully understand the tax valueof an investment property!!


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ALLEN TATE REALTORS

REALTOR NC/SC

Mike Pocisk
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