All Forum Posts by: Francisco Lopez

@Francisco Lopez, it all depends on the numbers. If your TX property cash flow, and you can manage, no need to sell.

That said, moving to another state will require a lot of extra cash in hand (especially when you buy land), so selling the TX property off may be better for you!

@Francisco Lopez Airbnb in general, and Land Hacking in particular is a stupendous strategy in Seattle or the greater PNW. We've LandHacked 7 acres up on Stevens Pass and have the property decked out with a Yurt, Tiny House, Historic Schoolhouse, and more to come, rented on Airbnb. Current cashflow is good and as more units come online it'll get even better.

As others have mentioned, keep in mind the "2 of 5 rule" that allows you to cash in $250k in tax-free Capital gains ($500k total for a married couple). Unlike a 1031, which is Tax-Deferred, the "2 of 5 rule" is one of the few strategies that is Tax-Exempt! If the property isn't cashflow-ing much, or if out-of-state management isn't your thing, I'd sell it within 3 years of renting it to take advantage of this rule. If its cashflow-ing/appreciating really well, easy to manage, and meets your goals you can still pull much of your equity out through a cash-out refinance or HELOC. You're probably seeing a pattern lol - Taxes are most people's biggest single expense, so when you're developing your long term investing strategy make sure to focus energy on money moves that defer, eliminate, or don't trigger taxes!

Hit me up anytime to talk more about land hacking up here in the PNW. Sounds like you're off to a great start, now lock in your strategy & execute

Quote from @Dave Skow:

@Francisco Lopez- thanks for the post and best of luck with the  move ...tough question to answer without more information ....in general - having a  solid  nest  egg  of cash in hand  to live on is  incredibly important  when moving and  re establishing ...so I woud recommend  considering selling ( even though at a slightly lower  price than  you woudve  got  6-9 monhs ago )  ...and  then move on wiht your plans  in the PNW  with cash in the bank and a much more  streamlined life that you can  focus on .   regarding  futue  deals - emplyment / income will be  very  importnat  to have  in order to obtain any new  financing - so make sure to  try to get this in place  asap - feel free to stay in touch with any other ideas / questions / needs

@Francisco Lopez-I believe Lender Dave Skow from Seattle, WA just gave you the best suggestions. As someone that
has looked at and funded hundreds of refi's and hard to do transactions, with possible upcoming  Covid mandates,
high inflation, uncertain federal admin., on and on, better with a move to a new area to have cash in hand. 

I would further advise you to go to the Seattle where you can maybe hook your wagon to Dave's operations, sounds like a good, possible mentor to help introduce you to the North Pacific.  Good luck and Blessings. EAB

@Francisco Lopez

A local Investor-Agent can help shorten your learning curve and save you a lot of headaches as they tend to understand the market better.

They can assist with market analysis on current rents, potential rents, appreciation, etc.

Good luck!

@Francisco Lopez- thanks for the post and best of luck with the  move ...tough question to answer without more information ....in general - having a  solid  nest  egg  of cash in hand  to live on is  incredibly important  when moving and  re establishing ...so I woud recommend  considering selling ( even though at a slightly lower  price than  you woudve  got  6-9 monhs ago )  ...and  then move on wiht your plans  in the PNW  with cash in the bank and a much more  streamlined life that you can  focus on .   regarding  futue  deals - emplyment / income will be  very  importnat  to have  in order to obtain any new  financing - so make sure to  try to get this in place  asap - feel free to stay in touch with any other ideas / questions / needs

You need to sit down and develop some goals, then make decisions that bring you closer to your goal.

It would be nice to sell your property and cash out $100,000 in equity, but what would you do with it? Invest in another home? If the current home cash flows, why cash out the equity only to bury it in another investment? What if the next investment turns out to be a stinker that doesn't cash flow as well or appreciate as much? Better the devil you know than the devil you don't.

If you keep it and it cash flows $400 a month, that's $40,000 over the next ten years plus another ten years of equity. Throw in rent rate increases and you could be looking at $250,000 in profit instead of $100,000 today. That's a 250% increase.

Almost nobody looks back and says, "I'm so glad I sold that cash flowing house ten years ago." Hold onto every property you get, unless you're selling to invest in another property that accelerates moving you toward your goals.

Remember you loose your capital gains exemption at some point, so keeping your personal residence as a rental doesn't always make the best financial sense.   You might want to check with your CPA before deciding to do this.   I like rental property, but you may be a lot better off selling now vs turning it into a long distance rental property.