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As far as my own taxes, I've been doing real estate for a while. I own over 20 properties and I know my tax situation pretty well. I have a cpa that knows real estate investing quite well so I think I'll pass on your advice that I need to go to a cpa.
That is nice and all...
....but you're leaving many things out if this true. Perhaps the CPA has not explained some of this? I mean you didn't realize investment property gets a capital gains tax. I'm not sure how else you wanted me to respond.
Yes, we must make assumptions, but if you want to be honest in the situation you can't low-ball every expense in your favor. The average HOA fee was from research in 2015.
In 2005 it was $250, so yes it is increasing, but in 2012, it would be higher.
You're posts are meandering a bit and I'm beginning to think you don't always know your own true costs.
You can not attack the investing side on taxing if they switch the investment to cash and not compare what happens when you switch real estate investments to cash too. We have to compare the expenses of accessing the cash, just to compare where someone really is in the situation.
You have to hold those things equal.
A person can leave stock invested, just as they hold property invested.
Location: Formerly Pleasanton Ca, now in Marietta Ga
10,345 posts, read 8,557,056 times
Reputation: 16679
Quote:
Originally Posted by cwkimbro
That is nice and all...
....but you're leaving many things out if this true. Perhaps the CPA has not explained some of this? I mean you didn't realize investment property gets a capital gains tax. I'm not sure how else you wanted me to respond.
Yes, we must make assumptions, but if you want to be honest in the situation you can't low-ball every expense in your favor. The average HOA fee was from research in 2015.
In 2005 it was $250, so yes it is increasing, but in 2012, it would be higher.
You're posts are meandering a bit and I'm beginning to think you don't always know your own true costs.
You can not attack the investing side on taxing if they switch the investment to cash and not compare what happens when you switch real estate investments to cash too. We have to compare the expenses of accessing the cash, just to compare where someone really is in the situation.
You have to hold those things equal.
A person can leave stock invested, just as they hold property invested.
Well let's just agree to disagree. I am well aware of capital gains taxes.
First, I don't flip houses as you seem to think I do so tax on profits is less of an issue as you make it out to be for me.
Next I do cash out refis so I don't have a tax issue and while there is a cost to it there is more than enough profit to overcome that cost. Who can argue making money with none of their own invested?
I am aware of taxes which is why when I sell I do 1031 exchanges.
My strategy is to buy and hold, not flip. I buy to set up cash flow machines .
My lack of investing and tax knowledge that you are now saying I have allows me to own a lot of rental homes in my name all paid for except the few I cash out refinanced to buy more cash producing rentals and increasing my net worth. I've also set up self directed retirement plans that also own rental properties which because they are Roth will not be taxed when I decide to withdraw. Not even using their income to live off of yet, just letting them grow and accumulate more rentals.
You can claim I don't know what true expenses are, but since I do my own accounting and create my own spreadsheets on over 20 properties , all of which are approved by my cpa, I think I know costs of maintaining real estate pretty well . Done this for decades. How many rentals did you say you own again?
I'm not the most successful or richest or most savvy investor out there, far from it.
But I do know this:
I work about 2 to 4 hours a month managing my real estate.
I make more money than when I worked.
My tax returns show I make that money.
I have nice tax deductions so I keep more than others who work a job and gross the same amount I do.
I strategically plan my investing path and run them by a cpa if I have any doubts about tax ramifications.
I do know what it costs to own real estate and what expenses will run despite you saying I don't.
I never have to work again and am loving my lifestyle , live in a nice house, drive nice cars, and am thankful everyday I learned how to make my money work for me and that I'm in this situation. I'm not sure I agree with you that I don't know what I am talking about since I think I've done ok.
So I'm just going to leave it at that and let you bask in your superior financial and tax knowledge over me while you work and search for a property.
You win , I lose, such is life. I think I'll live
Location: Formerly Pleasanton Ca, now in Marietta Ga
10,345 posts, read 8,557,056 times
Reputation: 16679
Quote:
Originally Posted by arjay57
I agree. How long it will take may be a matter of debate, but as you say, for the long term I don't think you'll go wrong.
But in my opinion that's how real estate investing works in general. Get in and stay in for the long term. We've still got a few properties scattered around that may yet be 15-20 years from coming to fruition. That's okay.
Where are your properties located? I'll bet you do well with them in the long run.
My original plan was to buy a lot of properties in Atlanta. My first post in the Atlanta forum years ago was asking about rentals was met with a lot of negative replies basically telling to take my slum lord money and get lost. I still see some of those people posting here these days.
I wound up investing in another city fixing up boarded up homes and renting them to families , so all worked out okay.
I do see a lot of exciting things happening itp and kind of wish I had ignored all the negative replies I got. Especially since I live in the area now.
Location: Formerly Pleasanton Ca, now in Marietta Ga
10,345 posts, read 8,557,056 times
Reputation: 16679
Quote:
Originally Posted by samiwas1
Eh? All it will take is another real estate crash and this situation will be the standard.
Do you think there will be another crash?
I am sure the market will slow down or flatten, but I can't see a crash happening like before. Seems like they were giving out horrible loans that were time bombs the last time.
I hope there isn't a crash, but if there is I will ready to invest in more properties.
Well let's just agree to disagree. I am well aware of capital gains taxes.
First, I don't flip houses as you seem to think I do so tax on profits is less of an issue as you make it out to be for me.
Next I do cash out refis so I don't have a tax issue and while there is a cost to it there is more than enough profit to overcome that cost. Who can argue making money with none of their own invested?
I am aware of taxes which is why when I sell I do 1031 exchanges.
My strategy is to buy and hold, not flip. I buy to set up cash flow machines .
My lack of investing and tax knowledge that you are now saying I have allows me to own a lot of rental homes in my name all paid for except the few I cash out refinanced to buy more cash producing rentals and increasing my net worth. I've also set up self directed retirement plans that also own rental properties which because they are Roth will not be taxed when I decide to withdraw. Not even using their income to live off of yet, just letting them grow and accumulate more rentals.
You can claim I don't know what true expenses are, but since I do my own accounting and create my own spreadsheets on over 20 properties , all of which are approved by my cpa, I think I know costs of maintaining real estate pretty well . Done this for decades. How many rentals did you say you own again?
I'm not the most successful or richest or most savvy investor out there, far from it.
But I do know this:
I work about 2 to 4 hours a month managing my real estate.
I make more money than when I worked.
My tax returns show I make that money.
I have nice tax deductions so I keep more than others who work a job and gross the same amount I do.
I strategically plan my investing path and run them by a cpa if I have any doubts about tax ramifications.
I do know what it costs to own real estate and what expenses will run despite you saying I don't.
I never have to work again and am loving my lifestyle , live in a nice house, drive nice cars, and am thankful everyday I learned how to make my money work for me and that I'm in this situation. I'm not sure I agree with you that I don't know what I am talking about since I think I've done ok.
So I'm just going to leave it at that and let you bask in your superior financial and tax knowledge over me while you work and search for a property.
You win , I lose, such is life. I think I'll live
I'm not trying to attack your lifestyle of get you to do anything you don't want to do.
But if you want to compare costs between two things, you have to hold things equal and maybe perhaps unknowingly, you're not doing that.
a cash-out refi is not a tax dodge, you will eventually be taxed on those properties to collect the equity and you're arguing that equity out-grows the market. Well you can't ignore the costs, even if you're planning on just holding onto the real estate for a long time (or the stock for a long time). You have to keep the accounting analysis on an equal footing. You need to properly calculate the cost of the refinance for the comparison too.
The same with stocks, so if you ever try to do a fair comparison... you have to account for all costs collecting the equity on both fronts.
You're trying to get the best of both world's in your analysis.
At this point I'll let this die and I think you're wanting to do the same, but you're not doing the comparison justice in the OP's sake.
For your case, not the original topic I might add... you've meandered this a lot, you're describing not just investments in real-estate, but running an actual business. There is some overlap here, but they aren't full the same. You have to account for the fact that you're not actually retired, that is your job... but your business is heavily real-estate investments, but it is also managing tenants and property as an occupation.
So that distorts the analysis further from the OP, further from you original disputed case and perhaps further missing the original points to the original subject as you're taking this in different more extreme directions from the original topic.
Good discussions above. We've invested in real estate and agree with comments that you have to want to do it and have to (overall) be in it for the long haul. In the end we got out and now do other, more passive, investments.
Sorry to do this but let's get back to the Original Post:
Quote:
Originally Posted by MrJones17
Lived in Midtown in 2012. Price of my updated studio back then was barely $100K. Similar units now sell for $150K+ and rent for $1,400+ now. I was paying $850 back in 2012.
On another note, does anyone know if condo HOAs in Midtown typically raise their rate every year? Or does it stay relatively the same. Never bought a property with an HOA before.
I just got back from a trip to ATL this weekend. Spent Saturday night at the Hampton Inn off of Buford Hwy. I drove around Midtown just to see what's changed...my God...easily like 10 new buildings in the area. All are glass and very nice. Loving that West Peachtree is becoming more dense.
I enjoy Raleigh for right now but I think I'll probably end back up in ATL. It's an even more exciting city than I remember. Love the energy Midtown now has. I remember when it was fairly quiet.
Do you think there will be another crash?
I am sure the market will slow down or flatten, but I can't see a crash happening like before. Seems like they were giving out horrible loans that were time bombs the last time.
I hope there isn't a crash, but if there is I will ready to invest in more properties.
The next crash will be car and student loans. That will impact credit ratings and people’s purchasing power. It doesn’t have to specifically involve home loans. When people have no money or no credit they can’t buy homes. You have essentially three groups of people right now that make up a large percentage of Americans:
Group 1. People who have extreme student loan debt
Group 2. People who have high car loans they really can’t afford
Group 3. People who have both extreme student loan and car debt
Something has to give eventually. There are plenty of articles online discussing car and student loan debt and how it can bring about a downturn for borrowers which in turn will affect housing loans.
Location: Formerly Pleasanton Ca, now in Marietta Ga
10,345 posts, read 8,557,056 times
Reputation: 16679
Quote:
Originally Posted by ronricks
The next crash will be car and student loans. That will impact credit ratings and people’s purchasing power. It doesn’t have to specifically involve home loans. When people have no money or no credit they can’t buy homes. You have essentially three groups of people right now that make up a large percentage of Americans:
Group 1. People who have extreme student loan debt
Group 2. People who have high car loans they really can’t afford
Group 3. People who have both extreme student loan and car debt
Something has to give eventually. There are plenty of articles online discussing car and student loan debt and how it can bring about a downturn for borrowers which in turn will affect housing loans.
Hmm. I understand student loan debt but had no idea car loans were such a big thing.
Now that the op has checked back in I wonder if they will rent or look to buy this time around .
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