All Forum Posts by: Glenna Wood

Bathroom plan? Running potable water?

#4 Talk hubby into it if the future cash flow numbers are solid and there are no deferred maintenance surprises. 

Consider that owning stock in the company where you get your paycheck keeps a pile of your eggs all in one basket. I worked for a smaller tech firm in the '90s with a 15% discount stock plan where you were free to buy on Friday and sell on Monday. This sweet option  disappeared overnight when my division of the company was snapped up by a bigger firm. 

If you stay in stocks, seriously consider investing in companies other than your own. My past 5 year stock ROI is 20%+ but some years I made way less and hunkered down in cash. It takes time to research so any investment outside of your current stock will take more of your time and effort. You mention an IRA. How are you investing that $$?

Stocks have no tax advantages. The passive loss rules for rental RE do let you offset some of your W2 income while offsetting most of the costs to own the RE and ideally while it is appreciating. This might fit your situation. But be prepared to have savings on hand for unexpected expenses if you own a rental. A caution for you since you state you aren't saving outside of your stock plan.

How to diversify across asset classes is always up for discussion and there is never one size fits all. And with RE there are many choices of investment types. In 40 years I've always been about half RE and half stock market. A big difference is liquidation. I can sell a little or all of my stock any time. Not possible with RE and the selling process costs you. The other is valuation. Stock prices get real time actual valuation. RE value is always someone's opinion until an actual buyer with real money is present.

Best wishes on your journey! And kudos for having the initiative to invest. So many people don't. 

This is where a good realtor who knows their market up and down will earn their commission. And ditto what prior folks have said, an HOA can ban your STR with one majority vote.

I've done this on my OBX house. Offered a week in Oct. The auction winners actually paid twice the rental rate to support the cause. I had a PM at the time. Notified them, had the winners contact me directly for house questions. I felt very comfortable that a donor at a faith based charity auction would be a quality renter. Cash donations to the charity in lieu of would also certainly work. 

Excellent info! Thanks, @Dave Foster and @Joe Sera

Very interesting question. Looking forward to hearing from the pros on it. It seems clear that it is in lieu of a 1031 since UPREITs are under sec 721 so the two don't mix. The aspects that would make me look very hard are: 1) how do I ever actually get my $$ back out of the UPREIT?, 2) it manages the properties directly so there are many hands in the cookie jar, and 3) how/when/impact if "they" decide to liquidate properties and what would be the exact impact to me? 

Being on the water is a huge plus. Main difference from any other property is check the flood insurance situation. What zone is the property in and have there been any claims? Get a thorough evaluation of any seawalls, docks, etc as these are big replacement expenses. If you are buying near salt water, newer us better than older as it will rust in places you never thought possible. Don't by someone else's deferred maintenance project. Otherwise it's normal due diligence to get the best fit to your wish list and budget. Since you want to vacation there, develop a specific list of what your family really wants versus a pure investment so you can sort through the many choices you have. Having my own place that I loved to visit + earn income with it has been very rewarding even though I left $$ on the table by using it. Best wishes and Happy Hunting! 

A QI is a process controller not a financial advisor. It is not their job to advise you on a DST vs you taking a boot.

No clue where you are but given your scenario of "tired of owning" I would simply sell all and 1031 into a DST now. The law hasn't changed yet. Selling off the 8 condos would be easy to manage as each could be an individual exchange. I have no experience with conversions into condos but getting the permitting, possible building code issues due to shift from multi family to individual condos, HOA setup docs, individual sales, managing your own units as your ownership fraction decreases, etc... WHEW Sure sounds like a huge pile of new work to me. Best wishes whatever you do!