Benefits of using a self-directed IRA for multifamily investment?

[Matt Everling]

Can someone set me straight on why I would want to use a self-directed IRA for REI when, as I understand it, does not offer tax benefits or liquid cash flow?

[Brian Eastman]

@Matt Everling

Simple. Having your IRA own a stable asset that produces consistent income might be better for the IRA than investing in paper assets that shift in value with the news cycle.

Comparing an IRA investment in real estate to a personal investment in real estate is comparing apples and oranges. The tax-sheltered status of the IRA is so different than personal investing. You investing in a mutual fund and your IRA investing in a mutual fund are also different from a tax perspective.

What you can compare in a meaningful fashion is how the IRA itself might perform in two different assets. If the opportunities you can generate in real estate will be better for the IRA than the stock market, then you are doing better for your IRA by investing in real estate.