All Forum Posts by: RaKell Adams

I wanted to update everyone on what we chose to do with our rentals. We did sell both of them and paid all the associated taxes. The markets continued to rise and the houses continued to go up in value which we missed. So, had we kept the rentals we would have made more money. 

With our proceeds we paid off our current home and bought out years in my teaching retirement. I’m sure we could have made more money through other investments. 

I have no regrets on our decisions. Our life is simple and secure. We are no longer landlords and have non of the accompanied stress. We are now able to volunteer our time in our community and spend our time doing things that are important to us. 

Real estate allowed us to retire early and gave us the gift of time to enjoy life. 

Our daughter and her husband would like to buy one of our rental properties.  We plan to sell it to her for near market value (will only be giving her a discount on price for not having to pay realtor fees), but will also be gifting her $20,000 in cash towards the down payment.  We will be netting about $120,000 in gains, and plan to pay the capital gains taxes. Are there any tax implications or laws I should be concerned about?

Jim Cummings, good advice on the military retirement part. My husband retired almost 4 years ago, and did find it very difficult to actually retire. He is currently working as a Dean of Students, and he seems to love his job! I teach at the same school, so I see first hand that it is good for him. He has a lot of military related health issues, so I do worry about how long he'll be able to work. 

I think I've decided not to sell and pay the house off. I see how that's probably not the best way to make our money work. I do not think we're getting a very good return on our investment now that the properties have appreciated so much. I'm leaning towards he 1031 exchange, but I would like a little more hands off approach to being a land lord. We're probably going to go ahead a renew the leases for another's year and start really exploring 1031 options. 

Thanks to everyone for helping me sort through this. Everyone's advice was so helpful. 

I really appreciate everyone's thoughts on my post. It has really got me thinking about all my possibilities. I met with a good property manager yesterday, and I'm looking into that. 

I am also really considering the 1031 exchange option. 

My husband and I are looking to retire in Tennessee. Is it possible for us to sell our rentals and use the 1031 exchange to purchase an investment property in Tennessee with the idea of possibly making it our primary residence in five or so years? What would be the tax implications on that?

Thanks in advance for sharing any wisdom you might have regarding this. :)

I appreciate the replies from everyone.  They certainly make me think and consider my options.  I just turned 50 and my husband is 51.  We should be okay in retirement.  I will be receiving a pension from teaching, and  we also have a 401K that we will access when we are old enough, in addition to my husband's military pension.   After thinking about this more, I think we are hoping to leverage the two rental properties to fill the gap from 50-60, so that an earlier retirement is possible. I am aware of all of the capital gains and the recaptured depreciation that will be paid on the properties, and yes, I am not happy about losing that much money.  We have been active landlords on the two properties and are kind of tired of that, so my other option is to hire a property management company.  The leases on the two properties are up in June, so just trying to weigh our options.  We definitely could raise our rents more, but we have good tenants and have a difficult time with that.  :)  I am going to think more about the 1031 exchange.  

I have two rental properties which I bought 4 years ago.  My initial investment in each home was $40,000.  Our market has gone crazy, and at this point, if I sold, I would net around $150,000 on each house after taxes and expenses.  

I am currently cash flowing around $500 a month on each home.  I am wondering if I should sell now that I have so much more money invested and am actually getting a much lower return on the total investment. 

I would use the money to pay off my current home where my payment is $1400 a month for principal and interest.  

With our mortgage paid off my husband and I would then be able to retire at age 55 because we also have a solid military pension in place.  

I do not want o buy any more rentals at this point, so exchange the property or reinvesting is not an option.

Please let me know your thoughts.