All Forum Posts by: Sherry W.

I am moving to a new state, and want to keep my current property that I live in as a rental. I have a mortgage of roughly 100K left. I want to buy a new home in the new state, however, I am early retired with no W-2's. I do have significant investments though, 1.5 million in stocks, (available and accessible) and 1.1 mil in an IRA (not accessible). I could pay cash for the new property, but I'd rather keep that money invested, and get a mortgage at the current low rates. FICO of 757. Is this possible?

Thanks, Dave!  That's what I needed to know.  I was trying all avenues to avoid taxes :) which will be substantial.  Cheers!  ~Sherry

I've Googled this extensively, and asked my accountant (who is not a real estate CPA)--

Here are the basics:

--We built the house in 2000

--Divorced in 2009, house was quitclaimed to me

--I lived in the house until mid-2011

--Rented it out from mid- 2011 to present

I am selling it now, moving out of state for a job,and have been trying to avoid a 1031 exchange, AND paying $$$ in taxes.  I read IRS Publication 523, to qualify for the exclusion of gain, and it states that: 

"You meet the standard requirements if any of the following events occurred during the time you owned and lived in the home you sold"  -

1. --Became divorced or legally separated

Since I did get divorced while owing the home, am I able to claim the $250K exclusion?  I understand that I will be taxed on the recapture of depreciation...and am ok with that, rather paying tax on the whole gain?

Can you stand some more "clarification"?  :)  It was not my intention to start a "tit for tat, who knows more" type of convo--I simply wanted to share my OPINION BASED ON MY EXPERIENCE to you. I really don't care whether someone else agrees with me--I'm relaying my opinion. I am not a realtor, just a person who did the same thing as you want to do, and can share with you some insight.

---RE: licensing...6 weeks ago, I was offered a realtor position in Playa.  I have no experience or license, just an outgoing personality.  Maybe the broker or agency is licensed, but I personally know of several people working as agents who have ZERO qualifications.  And, there's this---https://thecancunpost.com/buye....  So, I am not misleading you, but suggest that you do your due diligence by vetting the company/person you are dealing with, as there are PLENTY of non-licensed people out there, selling real estate as we speak.

--When we bought our place 15 years ago, it was impossible to set up internet, utilities, etc and keep them paid from AFAR.  I also like being able to walk/bike to the beach, hence my suggestion to stay on the beach side of 305.  Also, renters prefer to be close to the beach, in my experience.  If you are a beach club/wait for a shuttle type of person, there are definitely places across the highway--just not as conducive for vacation rentals.  And you mentioned, that you would like to use the place occasionally, not long term rentals--hence my suggestion.

--I personally know of 6 people who lost their money on pre-construction, and one project that was built over a cenote and sunk.  Was tied up in courts for years.  If your risk tolerance is such, go for it. I stand by my advice to seek existing properties--that way, you can start using it too.   Being cautious is not "fear mongering", unless I'm missing something.  I'm a single person as well, and know that I would prefer less hassle, more enjoyment.

--I am not a real estate mogul, just a regular person sharing my opinion.  I appreciate the insight gleaned from the Bigger Pockets forums, and am mostly happy to share my experience--without the unnecessary sanctimony--wink wink :) I will PM you my property managers info, and please PM me if you would like to chat further--  Cheers!  

HI there--We have a 3 br, 3 bath property in Playa del Carmen, in a development called Playacar, and have owned the house for 15 years. We have been through a couple of property managers, finally got a good one.  I go to Mexico at least 3 times a year, and watch the market pretty closely.   I have not heard of that real estate firm, and don't believe they are local. You don't need to be licensed or any type of certification to sell real estate in Mexico. I personally would not buy into the rental pool situation--why not hire an independent property manager and have them rent it when you aren't using it?  That's what we do.  Most independent prop managers charge 20% to rent out your property, plus a management fee monthly (our is under $200) to maintain the property, check on it, pay the bills, handle any problems.  I also caution against investing in pre-sale properties that are not built out--I've heard many horror stories of money lost when the builders disappear---and it's Mexico, almost impossible to get your money back.  I've seen lots of new development in the very early stages on the Coba road across Hwy 305 literally out in the jungle--for rental purposes, there is nothing around these locations, and they are at least 5 miles from the beach.

Many of the properties being built in Tulum are a WAYS from the beach, across Hwy. 305.   It is better to buy on the beach side of the highway, whether it be Tulum or Playa.  Tulum is quickly becoming ridiculously expensive to visit, especially restaurants and shops on the beach road--$14 US for a margarita in Mexico?  In Tulum town, things are a little different, but it is also 3 miles from the beach, and it's difficult to find beach access if you do go to the beach--the hotels and restaurants don't allow access unless you are staying there, or eating there.  Parking is a nightmare. There are beach clubs that cost anywhere from $25--$100 US per person, to use the chairs, etc., with some of the cost going toward food consumption.  In Tulum town, it's more authentic, and lower price.   Aldea Zama is a development you may consider, it is about halfway between Tulum town and the beach,  and they have some subdivisions within that may be ready.  It is closer to the beach, on the ONE ROAD that leads to the beach area.  Most of those developments are being built on the south side of Tulum, if you Google Map it.

I can give you a very trusted prop manager and real estate firm in Playa, don't know if they go to Tulum though.  I don't mean to rain on your parade--it CAN be done, we did it.  Just be VERY careful who you deal with.  Someone who actually knows the area, has a physical office there, has a history of sales in the area.  And I would never buy pre-sale, unless it is 95% finished, with management in place for maintenance of the property, internet installed, all the kinks worked out.   It's a nightmare trying to do all of that from the US.  

Thanks for the insight, everyone. I'll ask my attorney tomorrow. She's not behind in rent, and usually pays on time each month. Is the deposit (that I'm holding) usually listed as an asset, and will it be demanded by the BK attorney?

My condominium tenant just informed me that she has declared Chapter 7 bankruptcy. She explained that she would like to keep the condo, and the BK will make it easier to pay. Does anyone have any experience in this situation that you could share? Im in Colorado.

Thanks so much. I appreciate the speedy reply! Have a great day.

You mean, to include the lien on the settlement statement, to show it's being paid off by the seller? (FreddieMac)

Thanks for the quick reply. You are more informed than my realtor. Do I need to get a lawyer's opinion, or do you think it is safe to close on this property? I definitely dont want to be responsible for the tax lein, and if I understand correctly, it follows the property.