All Forum Posts by: Clayton Silva

 Love it!

Couple things to answer your question:

1) The investment vehicle depends on a lot of different factors: how much are you working with currently, how much do you contribute annually, how much do you need to do those things at that age, what is your sleep number (this is my favorite investing question because each person is different).  All the "sleep number" is, is what amount can you invest at what risk level can you invest it and still sleep ok at night.  If your investments are keeping you up at night, you don't have the risk tolerance nor understanding for your current portfolio. 

2) Can you build and grow a business between now and then that can eventually run itself with you largely hands off? This is going to be the most efficient way to retire.

3) What areas do you have an edge/understanding/grasp/ability to invest in?  For some people the best investment is real estate, for others it is ETFs.  Neither is really about the vehicle but more the understanding and discipline to execute a strategy by the individual investor.

I recently answered a similar question, but think it may help you as well:

"Most people focus on the market before they figure out the strategy/goal. That question is nearly impossible to answer without knowing what your goals are? Are you investing in the Midwest for cashflow and foregoing appreciation? Are you a high-income earner investing for tax offsets? Are you looking to make a little cashflow and go for appreciation plays. Each market comes with pros and cons, but you have start with the end goal in mind or else no market is going to get you where you want.

As someone who only invests out of state (CA price to rent is about as out of control as NY) I have different ones in different markets for different reasons. I would not recommend (from my personal anecdotal evidence) doing major rehabs from out of state as it tends to be difficult to manage.

I hope this helps but definitely define your goals and lay those out, then figure out which markets are best suited to help you achieve those goals."

 This is one of the most common "unicorn" questions I get in the industry.  Do they exist? Yes, technically, but for the most part, they are regional programs offered by small banks.  Even our nationwide lending partners may only do it in a couple states or regions.  The pricing is typically not that good, the overall offering is often no better than a normal low down payment conventional loan.  The biggest draw for folks is the low-down payment typically, and often times, if the buyer does not yet have the 3-5% down payment required they may not actually be financially ready to buy a home anyway.  

That makes more sense, I would definitely have a plan for the funds and deployment before selling.  Shoot me a DM for at least approximate market location, and I can see if we get any clients looking into that specific market to see if we have any interest and may be able to assist in the offload.

 100% on point

 Stellar! Best of luck and super smart strategy!

So you have to think about what their alternatives are. If I can afford 30% down, I can likely get better terms from a bank for a 30 fixed blanket loan. 30% down is going to put someone in the mid to low 7% range on a blanket 30 year fixed DSCR, so what is their incentive to take your terms? Blankets don't generally report to credit, they can close in their LLC etc.

Plus what is the win-win? Is your goal to avoid tax consequences? Have you considered an installment sale or other vehicle? 

Hard to give tips without a bit more context as to the goal. Could you get a higher premium listing them individually on the MLS? Are you listing yourself (implied by the broker comment).

As I understand it (please consult/confirm with a CPA) this is not tax or legal advice.

Pretty sure you met 1 of 2 criteria.  

1) When you 1031 INTO a new property, you CANNOT live in it for at least 2 years.  It has to be a rental for 2 years before it can be converted to a primary.  Check (2020-2024 investment) so you are good there.

2) To get the benefit of 250k in cap gains tax free (500k if married), you have to have lived in said property for another 2 out of the last 5 years.  Not check, (according to your post you will hit this in 06/2026).  So that is the part you will want to confirm with your CPA if I am understanding your timeline and question correctly.

Hope this helps!