All Forum Posts by: Cody Smith

@Glen Zuffelato yes, I apologize. There is some confusion. I definitely agree, selling would be a much better option to using the 1031, I made this post because I wasn’t completely sure if I could use the rule 121. Now I understand what it means and totally agree with you.

@Doug Spence thank you for the advice, that is some good info! I did not consider potential extensions due to active duty status. I will definitely be contacting my CPA for further clarification.

@Glen Zuffelato Thank you for the response! Are you referring to selling my primary residence as opposed to the investment property, which would avoid any tax or deferment of taxes altogether?

@Marco Bario that definitely clears it up! Thank you so much!

Hello BP, thanks for reading my post and the helpful responses I always get!

I currently have a single-family rental in the market I live in, Columbus, GA. I purchased this home in 2017 and lived in it as my primary until September of 2020. Since then, I have rented this property out and managed myself, I am currently bringing in about $700/mo dirty cashflow. Since purchasing this property, I have gained about $80,000 in equity in the home. 

I began looking into purchasing a short-term rental a few weeks ago. I initially planned to keep the long-term property and buy the STR with my own available capital, but now I am heavily considering selling the LTR and reinvesting the proceeds into a vacation rental condo somewhere on the gulf coast. Although I will be losing the LTR in the process, this exchange of property will take me from $700/mo cashflow to potentially significantly more per month, which is most important to me at the moment as I prepare to separate from the military in two years and lose my W-2 paycheck. Additionally, the LTR is due for a new roof and HVAC relatively soon, it's in a great location to sell fast, and I do not have the capital to keep the LTR and still purchase the STR condo. My thought-process is to trade an asset I paid nothing out of pocket for (VA loan on the LTR) and reinvest the money I have made into something that brings more cashflow to my pocket and I know will appreciate over time and be in demand since it's a condo on a very popular beach.

My question: since I lived in the property for 2 of the last 5 years, do I need to explore a 1031 exchange for the proceeds upon sale? Or am I able to take the proceeds as normal and just reinvest what I need for the down payment on the condo? I have tried to research this already, but I have not found clear guidance. 

Thank you!

Hey @Dan Mottolo! I am not very familiar with the Thrive network itself, but I did transfer to eXp from another brick and mortar brokerage about 2 months ago. I switched because I am a part-time agent with a full time job in the Army, and the requirements for me to physically go to the brokerage for EM, documents, checks, etc. was a little straining for me. eXp allows me to do everything online, which is much more convenient. I can provide some of my initial thoughts about the overall pros/cons about eXp as a whole:

Pros: All administrative work is mostly online and able to be completed remotely. There are many platforms you can use for support with questions (eXp world, Workplace pages and chats, phone calls to local broker support, and more). You have more independence if not part of a team. You get benefits from every downline you are part of (this depends on who you sign up to eXp with and what downlines they are a part of) to include courses, documents, training and more. There is a large variety of training opportunities taking place in eXp world almost every day. I was not able to attend brokerage based training due to my day job, so this is very nice. You can also have other people sign up for eXp underneath your name, and you will receive payment for every sale they complete with eXp (this is paid for through the Revenue Share Program and does not cost the person closing the sale anything at all). This is an amazing opportunity to build passive income through the company. You can also participate in stock option programs where eXp will take a portion of your commission and purchase eXp stock for you at a discount. 

Cons: For people who are new to the business, there is some great value to having a physical brokerage to work in. you have more face to face interactions with people to help develop you, you can attend training in person, they usually are established with paperwork, documents and procedures that can take some time to get used to. A physical brokerage can also provide the opportunity to work from the office, which feels a little more structured and can be less distracting than working from home if that's something you struggle with.

Let me know if you have any other questions!

@Nicholas Weaver I'm not seeing this on the MLS, do you have it listed? Looking for more info/pictures. Thanks!

@Lisett Tito I agree with a combination of both replies you have gotten to this question. On one hand, I completely agree with @Peter Mckernan when he says you need a mentor and someone to help you through the trials and tribulations of learning the business you're not taught in pre-license courses. On the other hand, I actually recently switched brokerages to eXp because I am also part time and needed something with flexibility. I was not able to go into the office for earnest money or closing documents or training, and any trip I had to make to the office was an inconvenience. Like @Marian Huish stated, eXp has constant training available that is totally online and covers every topic you can think of. That was a huge selling point for me. There are some downsides, however. In a brokerage like eXp, if you do not choose the correct person to sign up underneath that will provide you mentorship, then you might find yourself on your own a little, needing to seek out answers yourself. There are mentorship programs for new agents that provides this for you. Just make sure you really choose the right person to sign up underneath that is going to invest into your success. Remember, when you sign up for eXp, whoever you sign up with will make money when you close a transaction, which means everyone would love to have you on their team, but you have to be very intentional about who is going to provide you the most value, not just who sells you best on the brokerage. Best of luck!!!

@Joel Lazar I have a few connections, let me see if they are taking new properties!

@Gene Livingston wow. That was a lot of very well thought info that is well above my head lol thank you! My first thought for setting the capital was to just place it in the market for the short term in conservative index funds or something similar, but the market isn’t looking so great for making me money at the moment, at least through my uneducated perspective. Buy the dip??? Lol