All Forum Posts by: Kevin Geary

Bill Exeter thank you for the clarification. I don't think in my initial post I explained that even tho my client only wants to invest 50k into a new property they would be financing the rest in the form of a conventional loan. So that's where the gray area was on my end. They aren't actually trading down to a 50k property, they would be trading for equal or greater value. Let's just say for this example we found a 231k property within the allowable timeframe. Does everything you just stated still apply? Again, your info is invaluable! I really appreciate it.

Hey Kyle S. , Noticed no one from Las Vegas has commented yet. Margins are slim here but prices in general are much lower per property on average than Southern California so at least here there is a way lower barrier to entry. Feel free to reach out to me for insight on the Southern Nevada (Las Vegas, North Las Vegas, Henderson) market. Use me as a resources I can set you up on MLS property searches, pull appreciation charts per zip code, etc...always happy to help!

Hey @Bill Exeter, I have another question regarding "Net Proceeds". Las Vegas Realtor here. a large portion of business comes from investors, thats just the Las Vegas and Henderson, Nevada market has been. I have successfully represented clients who relinquished and purchased using 1031 but I am in the process of consulting another investor who has a very particular request/circumstance that I haven't dealt with. My clients primary goal is to divest as much as possible without paying taxes on the earned income (would rather defer). When normally Ive just dealt with investors who are happy to take all monies received and put it into a new investment.

The issue I'm running into is the fact that my client purchased their initial property cash for 168k. The home will sell for 230k. After commissions, title fees, transfer tax, etc...lets just say then net 50k.

Now, I understand you have to reinvest "net proceeds" into a like-for-like equal or greater value asset but my client wants to obviously only reinvest that profit from their sale (50k) because that is the money they want to defer taxes on. They would like to take that initial 168k and make is liquid. Since that 168k was already realized income in years past and was obviously already taxed my client doesn't thing they need to reinvest that money for a successful 1031 exchange. I consulted my local certified 1031 title rep but haven't heard back yet, so I figured I'd ask on here in the meantime.

The tax code says "net proceeds", which, in real estate terms, by definition means all monies recieved at COE. Just curious if it actually only means all net profits received at COE.

I apologize in advance if my post is hard to understand. Thanks!

I accidentally hit submit before I could finish my post. The best insight I have are my experiences in working with PMs while Am the agent representing a prospective tenant. I have a couple in mind. Shoot me a message and I'll send you my contact info

Property management?

Hey Mansoor Fazel, you hit the nail on the head with most of your info. A bit of hyper appreciation lately, 7-9% YoY easily. Rents usually catch up to the party a year or so later. From what it looks like Las Vegas is still far cheaper than SF and SoCal. A large proportion of my buyers lately who aren't SOI are California residents migrating almost exclusively because it is too expensive in their native cities. I don't see any real reason why that trend wouldn't continue for the foreseeable future. I'm convinced Vegas is just going through a bit of an inventory shortage at a certain price point which drives the median home price up and squeezes those margins you were talking about. Green Valley, Henderson and Summerlin have always been relatively slim pickings in terms of an investment deal compared to other parts of the city like the south west or the north & northwest. I'd say don't get discouraged but you have to be patient. Spring and summer is always going to be the most competitive times of the year for the Las Vegas housing market. The school year ends in about a month. All the families who've been wanting to move start around this time. Sorry for the long winded comment

@Jack B. Hey Jack, I get clients into rentals all the time in Las Vegas and I have a system where once the tenant is in place I pull the tax record to see what the owners paid, for purposes of targeting them as potential owners w/ equity- potential future sellers. Far more often then not these owners are owners from 2008-2013. They purchased low and have a nice spread between the mortgage and the collected rent. The market now is not priced so well for for rental income. That isn't to say you can't squeeze a deal but the margins are becoming less and less as the market keeps rising. It is going to take a bit of time for rental comps to catch up to the sales comps. So, yes, appreciation would probably be the largest draw to purchasing an investment property right now.

I will be looking for a mentor in Las Vegas to assist with the flip but I just wanted to sort out the financing options first. @Kyle McCorkel, I was under the assumption that there were even closing cost with a HELOC, at least some form of loan origination fees. I know hard money is more expensive but I just want sure if going into my personal assets to assist with the financing of a flip was the best idea from a liability standpoint.

I have a couple hundred thousand equity in my primary residence. I like where I live so selling to free up money is out of the question. I am a licensed realtor and want to finally flip a property if possible. Hard money seems like the standard way of financing a project like a flip renovation. Is financing with the equity of my current home a terrible idea? TIA.