What is a real estate strategy?
Real estate strategy. There is something that wealthy families in this country have known for decades. Real estate has a strategy. The smart people develop that strategy. They make massive amounts of wealth with that strategy. Failing to do so in advance can easily cost you hundreds of thousands of dollars in lost profits and overpaid income taxes. Here are some simple ways to develop yours.
What is your timeline?
First, develop your timeline. When you determine that you are looking to develop wealth through real estate, are you looking at a 10 year, 20 year, 30 year timeframe or ??? Once you have determined what your personal time frame then it is important to answer the next question.
Real estate strategy goals
Second, are you looking to cash out at the end of that timeline or are you looking to live off of the passive income? This is a key question. As the old adage goes, “Begin with the end in mind.” Some folks may want to do a massive cash out. Others prefer to get a steady stream of checks each month from the passive income. Which do you prefer? And when you have determined that, realize you want to do this journey intelligently. Maybe you own a Las Vegas or Henderson home already. Perhaps you have a Henderson condo or a townhome in Las Vegas. It may actually be a better start to sell that and buy multiple units to begin with. I recently saw someone who was going to rent out their home for $3,500 per month. We found that if they sold the home and bought units, they could collect around $5,000 a month in rent instead.
Third, do you have flexibility in your timeline? After all, if you are thinking, “I want to cash out in 10 years” – what happens if your property loses 30% of it’s value in 9 years due to a recession? Make sure that you have a degree of flexibility in your timeline. Who knows? That could also mean cashing out 2 years earlier instead of 2 years later.
Real estate strategy experts
Finally, what is the best tax advice you can get? After all, if you use tools like 1031 tax deferred exchanges or a charitable remainder trust, you’ll want to make sure that the right tax professional is advising you correctly. Make sure to hire the right experts for your tax advice.
Does it really matter?
Can all this really make a difference? Well, I know someone that invested a few hundred thousand dollars. They bought apartments, fixed them up, raised the rents and then refinanced them to pull out around one hundred thousand dollars.
Each year they wrote off the maximum amount of depreciation from their taxes. 4 years later they exchanged that complex into another more expensive one. They fixed it up, refinanced, pulled out a couple hundred thousand, and repeated the whole process.
And remember, that each year they wrote off depreciation. Finally, after 20 + years, when they sold the apartments, they would owe everything to taxes. So instead, they donated the apartment complex they owned to a hospital. Because of that they didn’t have to pay a penny in taxes on that liquidation.
Even better? These folks were still allowed to collect rents for another 20 years. For their investment, they made a massive profit (somewhere over 300%). They used the tax laws legally to avoid paying taxes. And collecting those rents provided a passive income for another 20 years.
By now, you may be thinking of what you want your real estate strategy to be. That is an important question to answer. Call me anytime and let’s set a strategy that works for you.
For more information, EMAIL ME
And see my latest information at:
CLICK HERE to see what your home is worth
CLICK HERE to search for Las Vegas area homes