tax reform....sell primary use equity for real estate investing

[Ken F.]

Hello BiggerPockets,   Id like to hear some thoughts/feedback on this idea..... while I have not obviously vetted this "idea" out just yet...its intriguing to me.

I sell my primary residence and use the equity ($100K plus) on the purchase of real estate (SFH). I could rent the same type house basically in the same neighborhood for slightly less than the mortgage payment (keeping my children in the same schools). Living in TX, with high property tax, the new tax law maxing out the state and local tax deductions (in this case property tax) @ $10k will impact me (unfavorably)..so home ownership loses some of its long standing tax perks.

What I get in return - a significant boost in my rental portfolio (cash flow) and the pro business tax perks.   

what am I not considering?  ie the loss of long term appreciation (my question is more geared towards the tax perspective...not the personal side of being a renter)

*note - having relocated several times in my career, I am not tied to home ownership...   My long term goals are to acquire investment real estate to retire "earlier".  

Thanks all, ken 

[Patrick M.]

I am trying to parse through a lot of the hyperbole in the press surrounding the tax reform. But the money seems to be on a softening of the SFH market. Does not seem to be the opportune time to put a house up for sale- no?

I would check out a HE loan before the market tightens. 

Also- Please,Please- make sure you are truly adversely affected by the tax plan before you make your moves. I have spoken with too many people who are merely reading blurbs and assuming a lot. I am from a high property tax state and high income tax state and many of my neighbors wrongly assume they are adversely affected. $24000 is a heck of a lot to overcome. Plus you said you have kids- that is $2k a pop off of the tax you owe. 

There is tremendous misreporting and bias against this tax law. Sit with your CPA.

Best of luck!