All Forum Posts by: Valerie Kinkead

Yes! Relay! That was it. Thank you!!

Hey everyone! I was listening to one of the BP podcasts recently, not sure which one since I listen to a lot of them. There was an ad about a bank that lets you set up multiple accounts within the same business account, so you could set up one for each property you own but only have one login, etc. I can't remember the name of the bank, I've gone back and tried to listen to some of the podcast episodes  but I can't seem to find the one with the ad in question. The podcast notes don't list the podcast sponsors so looking for it that way isn't helping me either. 

It would be really helpful to have links to the sponsors in the show notes. There have been other sponsors that have sounded interesting to me, but I usually listen while I'm driving or running and can't easily stop and write down the name of the sponsor, seems like it would be more effective advertising to list them in the show notes, or to have one page where BP lists all the podcast sponsors so you can go back to get more information. Any suggestions?

I own a property in Layton Utah that could be a great STR. I just don't have the cash reserves to get it started to furnish it and get it rolling. Could be a great STR arbitrage property if I could get in touch with someone with experience. Any suggestions?

Ok, so using the rental calculator it is showing my cash flow at $19 per month, but I can't manipulate the numbers to show the correct balance on the mortgage. We've had the 2.37% rate for 4 years now, but when I change the loan balance amount to show the current balance, it doesn't show the correct monthly payment. When I change the monthly payment, it doesn't show the current mortgage balance. The calculator is assuming that I'm buying the home today. I can't manipulate the numbers correctly to show that the loan began in 2020.

The current tenants are moving out this month which is what is prompting our decision to either sell or keep renting. The rents are already maxed at what the market will tolerate...$2950/month for a house with a $635k market value. The house is in Layton Utah which has had great appreciation, but the cash flow stinks. I'm thinking that if I want my goal to be cash flow and to grow our Real Estate portfolio, selling and diversifying into multiple properties might be the better move.

If my focus was just on appreciation, holding it long term and keeping the low interest rate would probably be the better choice.  A big part of me wants to hang onto it in case we ever move back to the area. We will never find another house like it for the price we originally paid for it and with the low mortgage rate. But I also don't want to hang onto it and pay the opportunity cost of not diversifying for a "what if we move back" scenario that may never happen. 

Hi! I'm trying to decide if the home that we lived in as a personal residence and then converted to a rental is still a good investment or not. In the rental calculator do I put the current market value as the purchase price? Or do I just use the remaining balance of the loan? Or do I put the original price we paid for it? How do I decide if its better to keep renting it or to take the equity out and diversify into multiple properties with more cash flow? We have about $250k in equity, its only cash flowing about $200 after expenses, but our loan is only at 2.375%. We could take out the equity and invest in multiple other properties and have more cash flow. Also, since we lived in it as our personal residence, we only have about 1 more year that we could sell it and take the exemption to not have to pay capital gains. 

According to IRS publication 523 https://www.irs.gov/publications/p523#en_US_2022_publink1000...

You could still take a partial exclusion to capital gains even if it has been more than 3 year since you moved out. So if you lived in the home for 12 months of the last 5 years, you would divide 12 months by 24 months, which gives you 50%. Multiply that by $250k per spouse. You used the term "we" in your original post, so I assume you're married. So each spouse can exclude $125k in this example. Your numbers will be different depending on how long you lived in the home from the date 5 years preceding the date of the sale of the home. So yes, you could still take an exclusion from capital gains, but you want to start planning now for the sale if you want to use this option. 

Here is the worksheet from the IRS publication:

B) Complete this section only if you have determined that you aren’t eligible for the maximum exclusion but are eligible for a partial exclusion. If you are eligible for a partial exclusion, use this section to determine your exclusion limit.
Step 1	Determine the shortest of the following 3 periods:
	1. Your time of residence in the home during the 5-year period leading up to the sale	_____
	2. Your time of ownership of the home leading up to the sale	_____
	3. The time that has elapsed between the sale and the date you last sold a home for which you took the exclusion, if applicable	_____
Step 2	Take the smallest period from Step 1 (you may use days or months) and divide that number by 730 (if using days) or 24 (if using months)	_____
Step 3	Multiply the result from Step 2 by $250,000. Stop here if not married filing jointly	_____
Step 4	Repeat Steps 1–3 for your spouse and add the two results	_____
C) Your exclusion limit is $___________. Unless you have taxable gain from business or rental use (see ), only gain in excess of this amount is taxable.

My husband's job moved us away from family and across the country in early 2022. With the way house prices were skyrocketing in our home state, we didn't know if we would ever be able to afford to move back again if we wanted to, so we kept our personal residence and have been renting it out. We didn't know for sure how long we would stay in our new location but knew it would probably be 2-3 years minimum. We are coming up on 2 years now and we know that if we ever want to sell the property in our home state, that we need to do it soon to avoid paying capital gains by using the personal residence exemption. We have about 200k of equity locked up in our home, but its only cash flowing about $100/month. Its a VA assumable loan at 2.37%. Without selling it, we are short on our emergency cash reserves and are in a risky situation if any emergency should come up. The home is in an area with a huge housing shortage, in a great neighborhood that saw 20%+ appreciation during the pandemic. If interest rates go down we know prices would start going up quickly again, but in the meantime, we are short on cash and having to be very careful with our spending. Should we sell the house to get ourselves in a better financial situation and risk not being able to afford to buy back into that market if we ever decide to move back? Or keep the house and just work really hard over the next couple years? We are in our 40s, so we don't have a lot of time to correct mistakes if something goes wrong. Both come from low-income backgrounds with not great financial education and we're trying to do better for our kids than what our parents did, but worried we might be screwing it up anyway! ;-p