| What did you buy as your first investment property? |
|
|
|
|
|
mir322
Contributing Member
Cash: $ 2.70
Posts: 28
Joined: 30 Jan 2005
|
| What did you buy as your first investment property? |
 |
|
My husband and I recently purchased a home in foreclosure and intend to sell it again after cosmetic renovations.
I'm interested in what others are purchasing as well. We'd like to buy something and flip it every year or so to supplement our incomes.
|
Sun Jan 08, 2006 4:33 am |
|
|
No-Brainer
Senior Member
Cash: $ 83.45
Posts: 986
Joined: 29 Dec 2005
Location: Oregon USA
|
| Re: What did you buy as your first investment property? |
|
|
quote:
Originally posted by mir322
My husband and I recently purchased a home in foreclosure and intend to sell it again after cosmetic renovations.
I'm interested in what others are purchasing as well. We'd like to buy something and flip it every year or so to supplement our incomes.
If you really want to supplement your income, live in each one for two years as a personal residence before you sell it. Study the tax implications to see why I say that.
Easiest Path to Grow Your Income For Free
Free Crypto Pays Compound Interest DAILY!
|
|
Sun Jan 08, 2006 5:39 am |
|
|
MattL
Senior Member
Cash: $ 46.85
Posts: 234
Joined: 25 Jun 2005
|
If you really want to build equity keep the properties long term and rent them.
Debt Elimination
|
|
Sun Jan 08, 2006 9:15 am |
|
|
mir322
Contributing Member
Cash: $ 2.70
Posts: 28
Joined: 30 Jan 2005
|
| Re: What did you buy as your first investment property? |
|
|
quote:
Originally posted by No-Brainer
If you really want to supplement your income, live in each one for two years as a personal residence before you sell it. Study the tax implications to see why I say that.
I know that would be the 'best' thing to do. But with a growing family, I don't see how that's realistic. Not paying taxes on that large of a return would be great.
|
|
Sun Jan 08, 2006 3:14 pm |
|
|
Rolo
Yo' Daddy
Cash: $ 309.70
Posts: 1551
Joined: 13 Mar 2005
Location: Colorado/Florida
|
nono..you sell it and take the profits to buy a bigger property...your capital gains are reinvested.
"Expect me when you see me."
|
|
Sun Jan 08, 2006 5:57 pm |
|
|
mir322
Contributing Member
Cash: $ 2.70
Posts: 28
Joined: 30 Jan 2005
|
quote:
Originally posted by Rolo
nono..you sell it and take the profits to buy a bigger property...your capital gains are reinvested.
Correct...right now, we own a duplex...once we sell that, we'd look into a 4-8 unit. That's the plan anyway 
|
|
Sun Jan 08, 2006 6:38 pm |
|
|
bong12187
Preferred Member
Cash: $ 24.50
Posts: 120
Joined: 31 Jul 2005
|
quote:
Originally posted by mir322
quote:
Originally posted by Rolo
nono..you sell it and take the profits to buy a bigger property...your capital gains are reinvested.
Correct...right now, we own a duplex...once we sell that, we'd look into a 4-8 unit. That's the plan anyway
Hmm.. living in a property for two years before selling it exempts you from paying taxes to Uncle Sam (ok not really exempt for there is a 500k limit profit per person). Now, what Rolo is trying to say is to do a 1031 exchange where all profits from a flip is reinvested. However, from your previous post, it seems that you are using the profit to supplement current income. No-Brainer's recommendation of keeping the property and renting it out is the best way to supplement one's income. You will also benefit with the phantom income that people usually don't see. I also recommend for you to learn taxes. Real estate and taxes go hand in hand and the more you know, the more you'll be able to deduct.
B
|
|
Tue Jan 10, 2006 8:59 pm |
|
|
SLCKev
First Time Poster
Cash: $ 0.20
Posts: 1
Joined: 28 Feb 2006
Location: Salt Lake City
|
I own a duplex and am a Realtor. One thing to consider on flipping properties is the capital gain taxes. If you hold for less than a year and don't reinvest the proceeds with a 1031 exchange, you'll be taxed at the short term capital gains rate, ouch. If you hold it for more than a year it's long term capital gains. If you do a 1031 exchange, it doesn't matter.
Make sure you plan for the taxes you'll owe either way.
Then of course their is the advantage of occupying it as your personal residence for 2 of the 5 years of ownership, but you said you don't want to do that. Good luck!
|
|
Tue Feb 28, 2006 1:52 am |
|
|
Death_2_us
New Member
Cash: $ 1.70
Posts: 7
Joined: 28 Feb 2006
|
I bought a house.
|
|
Tue Feb 28, 2006 11:55 pm |
|
|
|
