| Author |
Message
|
| crazycow |
 Posted: Sun Apr 09, 2006 9:20 am Post subject: |
 |
|
Investing Associate
Joined: 02 Nov 2005
Posts: 21
This Month: 0
3476.91 e$
Net worth: 5,190.95
Portfolio Value: 1,714.04
Monthly Return: -45.93%
Trades this month: 0
Churn Rate: 0.00%Items
|
| What do you guys think about flipping new construction Condo's? I've just invested in two of them which have been climbing at a steady 10% for the last two years... |
|
| Back to top |
|
 |
| Dave Rathbun |
| Posted: Sun Apr 09, 2006 9:33 am Post subject: |
|
|
CFO
|
You want to know how to sell both of those properties with up to $250,000 in potential gains absolutely tax free, and legal?  Live in the property yourself for two years. I'm not a tax accountant, but my understanding of the tax law is that if you sell your primary residence (which is defined as the primary location where you live) after living there for two years, then a quarter million dollars in gains is tax free. It's half a million if you're married.
So if you move into one of your condos and live there for two years, then that 10% gain per year is tax free. Sell it, and move into the next one and live there for two years. Same deal.
If you have an accountant, verify all of this with him (or her) before embarking on this strategy. But that's the way I understand the rules to be. |
|
| Back to top |
|
|
| vetelmo |
| Posted: Sun Apr 09, 2006 10:49 am Post subject: |
|
|
Moderator
|
| Dave Rathbun wrote: | You want to know how to sell both of those properties with up to $250,000 in potential gains absolutely tax free, and legal? Live in the property yourself for two years. I'm not a tax accountant, but my understanding of the tax law is that if you sell your primary residence (which is defined as the primary location where you live) after living there for two years, then a quarter million dollars in gains is tax free. It's half a million if you're married.
|
Yes that is very true. My parents are doing that when they sell there"1st" home and move into their 2nd while the home they plan to retire to, is being built. |
|
| Back to top |
|
|
| FunkDaddy |
| Posted: Mon Apr 10, 2006 2:55 pm Post subject: |
|
|
Investing Associate
Joined: 18 Mar 2006
Posts: 27
This Month: 0
5499.53 e$
Net worth: 9,651.85
Portfolio Value: 4,152.32
Monthly Return: -22.74%
Trades this month: 0
Churn Rate: 0.00%Items
|
| It can be a very profitable business but you have to have the experience, patience and connections as well as be able to get into a good real estate market. |
|
| Back to top |
|
|
| crazycow |
| Posted: Tue Apr 11, 2006 9:44 am Post subject: |
|
|
Investing Associate
Joined: 02 Nov 2005
Posts: 21
This Month: 0
3476.91 e$
Net worth: 5,190.95
Portfolio Value: 1,714.04
Monthly Return: -45.93%
Trades this month: 0
Churn Rate: 0.00%Items
|
Wow, great Idea - I know there is a clause that requires me to own the property for 1 year after closing. I was thinking about renting it out and than selling, I will definately talk to an accountant and post any news I hear.
Thanks! |
|
| Back to top |
|
|
| InvestingMac |
| Posted: Thu Apr 13, 2006 6:40 am Post subject: |
|
|
Investing Manager
|
Please do. I would be interested in what the accountant has to say about that.
Seems like a reasonable way to go if, as funkdaddy said, you have the experience, connection, and initial capital to invest into a project like that. |
|
| Back to top |
|
|
| Dave Rathbun |
| Posted: Thu Apr 13, 2006 6:46 am Post subject: |
|
|
CFO
|
You can make money renting too, it's just not tax free.  You can even rent a property for a while and still use this exclusion... all you have to do is live in the house for two years before selling it.
I have a friend that buys a house and renovates it while he's living in it, then sells it two years later. Often times for major bucks. And since the property was his "primary residense" the entire gain, up to the limited amount, is tax free. He rolls that over into his next house. It's not a bad way to make a buck, as long as you don't mind doing some work by yourself, and living in a house that is constantly torn up. |
|
| Back to top |
|
|
| poornewb |
| Posted: Thu Apr 13, 2006 7:29 am Post subject: |
|
|
Investing Manager
|
| Dave Rathbun wrote: | You can make money renting too, it's just not tax free. You can even rent a property for a while and still use this exclusion... all you have to do is live in the house for two years before selling it.
|
To make the money while renting and not pay taxes. Just start a llc or corporation funnell the money into there and then you right off everything, such as your corp leases your truck from you. plus all the expenses of up keep and such, theres ways to get the money out of the extra rent with out having to pay taxes on it. Remember corporations pay everybody else first then they pay uncle sam!! |
|
| Back to top |
|
|
| jdunn72 |
| Posted: Thu Apr 13, 2006 9:04 am Post subject: |
|
|
Member of The Month
March
Joined: 26 Jan 2006
Posts: 1407
This Month: 0
11266.12 e$
Net worth: 11,266.12
Portfolio Value: 0.00
Monthly Return: 0.00%
Trades this month: 0
Churn Rate: 0.00%Items
|
| Benjamin wrote: | According to a recent article in Money magazine the national average a foreclosed home sells for under appraised value is 15%. However in Los Angeles this is 0% and Cleveland 31%. It really depends on the market.
"In general your not going to get a great discount in a great location."
I found the article online:
Bargain Hunters Beware
As far as where to find forclosures I'm really not sure. Perhaps another member is experienced with this. |
County records. |
|
| Back to top |
|
|
| frusnak |
| Posted: Thu Apr 13, 2006 11:26 am Post subject: |
|
|
CFO
|
| crazycow wrote: | Wow, great Idea - I know there is a clause that requires me to own the property for 1 year after closing. I was thinking about renting it out and than selling, I will definately talk to an accountant and post any news I hear.
Thanks! |
I believe you have to live in the home for at least 6months out of the year. Make sure you check this out. We have made good money on all (3) of our homes when we resell them. This one(4th) we are selling before 2 years but I have a medical condition exclusion. Two story townhome with a bad knee. A doctor's note to verify the condition will let us move less than 50 miles and not be penalized. If you can keep moving more than 50 miles I wonder if you could just keep on buying and selling? Just have inflaitable furniture and don't unpack anything    |
|
| Back to top |
|
|
|
|
 |
| poornewb |
| Posted: Fri Apr 14, 2006 4:44 am Post subject: |
|
|
Investing Manager
|
| Youve got frusimoto to help you move whats the problem? |
|
| Back to top |
|
|
| frusnak |
| Posted: Fri Apr 14, 2006 6:51 am Post subject: |
|
|
CFO
|
| poornewb wrote: | | Youve got frusimoto to help you move whats the problem? |
He's been out on his own for awhile now trying to earn some money since Ben cut off his income from non-investment posts. He is not allowed to express his insight on the market because of his insider connections with the asimo/robot nation. |
|
| Back to top |
|
|
| crazycow |
| Posted: Mon Apr 24, 2006 6:18 am Post subject: |
|
|
Investing Associate
Joined: 02 Nov 2005
Posts: 21
This Month: 0
3476.91 e$
Net worth: 5,190.95
Portfolio Value: 1,714.04
Monthly Return: -45.93%
Trades this month: 0
Churn Rate: 0.00%Items
|
| frusnak wrote: | | crazycow wrote: | Wow, great Idea - I know there is a clause that requires me to own the property for 1 year after closing. I was thinking about renting it out and than selling, I will definately talk to an accountant and post any news I hear.
Thanks! |
I believe you have to live in the home for at least 6months out of the year. Make sure you check this out. We have made good money on all (3) of our homes when we resell them. This one(4th) we are selling before 2 years but I have a medical condition exclusion. Two story townhome with a bad knee. A doctor's note to verify the condition will let us move less than 50 miles and not be penalized. If you can keep moving more than 50 miles I wonder if you could just keep on buying and selling? Just have inflaitable furniture and don't unpack anything |
Yup, that's what I intend to do...actually I've got 2 units in the same building - one on the 16th floor and one on the 4th. But I'll definately give this some thought. |
|
| Back to top |
|
|
| bigdave |
| Posted: Sat Apr 29, 2006 3:31 am Post subject: |
|
|
Investing Sr. Associate
|
| flipping will be slowing down except in extreme areas as the housing rise slows flipping will become more difficult... trying to flip a house in southern states is difficult unless u get a deal on the house and wont turn near the profit and you may have to sit on the home longer |
|
| Back to top |
|
|
| Grimreaper |
| Posted: Sat Apr 29, 2006 3:58 am Post subject: |
|
|
CFO
|
Existing home sales report for Fl published in today's real estate section of da newspaper and we are beginning to see da crack forming in da dike. Existing home sales throughout Fl down 22% for Mch year over year, although prices still showing double digit gains in most areas, cept Ft Walton Bch where they were down 1%. Purty kewel da way mawkets of all types work, no matter which mawket it be. With a glut of homes on da mawket right now because many buyers are priced outta da mawkets and realtors still taking listings even though they know they are overpriced...we will soon be seeing falling prices everywhere. One home flippin fool here in my town paid 120K for a little 2 br POS here in my town, tried to sell it for 170K on his own and couldn't get er done in 4 months so what did he do? He threw about 10K into renovations and listed it with a realtor for 198K!!!  That's how I found out about realtors taking listings at any price. I called the listing agent to find out what da clown was axin. The realtor told me there was no chance of selling it but they took the listing anyway....just in case. Now dats one fine fiduciary relationship!  |
|
| Back to top |
|
|
|
|
stock market game on the web. At eInvesting you compete for monthly cash prizes while you interact, make virtual dollars, purchase items, and trade in the realistic stock market simulator. We make investing FUN!
