Posted on July 21, 2008 @ 11:02 pm - Written by BawldGuy
Leave, you say? No, still live here, just take your investment capital to places where it will actually do, well, what it’s supposed to do. Grow. Want income? Whatever yer gettin’ in California, it’s easily more likely than not, you can do better elsewhere.
This is common sense. Properties requiring upwards of 40% and more to merely break even each month, aren’t candidates for capital growth or cash flow for serious investors.
I’m in San Francisco tonight. There’s a conference tomorrow offering a rare treat. I get to listen, take notes. and get to learn. There’s gonna be a bunch of very bright hi-tech types showing guys like me how best to improve what I do without makin’ it seem like rocket science. Works for me. It’s not about real estate. It’s about helpin’ me do what I do best.
It’s funny though, talkin’ with NoCal people. Their real estate world is skewed to say the least, relatively speaking. Prices that make San Diego income property owners pay attention, are high indeed. Still, price differences aside, both regions think fundamental truths about their markets haven’t really changed. Armed with this false belief, they blithely continue down the road their various strategies have taken them.
Posted on June 12, 2008 @ 9:14 pm - Written by BawldGuy
There are a few myths out there held as nearly doctrinaire by many. This one though packs a surprise waiting in ambush — timed to go off at retirement.
It’s held as almost the 11 commandment that once you retire, your income tax rate will drop significantly. This is so far from the reality, it’s akin to teaching summer brings cooling temperatures.
Ya can’t have it both ways. Those for whom the myth is almost a spiritual mantra, are the same ones who preach save and invest from the crib. Amass ginormous amounts of capital. Capital which will yield massive amounts of retirement income. Really? Massive income? Yet lowered income tax rates? Anyone see a problem here?
There’s only one reason for most folk’s income tax rate to fall in retirement: They simply didn’t Purposefully Plan — resulting in a retirement income capable of keeping food on the table, but sadly, not much more. Of course their income tax rate will fall.
Posted on June 4, 2008 @ 11:07 pm - Written by BawldGuy
Wanna know when clients ask that question the most? After their most recent round of purchases/exchange has closed, and before they’ve had a chance to take a breather from the process. The ink isn’t dry on their new deeds, and they wanna know when they’re supposed to get rid of them. And they’re serious as a heart attack. It’s gotten to the point where I just make fun of them immediately.
Still, their question addresses one of the most important quandaries a real estate investor faces — when is the right time to move capital/equity from where you are to some place and/or situation you judge better?
I dunno, let me ask the Guardian Angel in charge of real estate. Or better yet, I’ll consult that black ball we had as kids. You know the one — Answer Ball. Come on, you either had one or knew a kid who did.
Posted on May 30, 2008 @ 10:56 pm - Written by BawldGuy
To my friends and all real estate investors in San Diego/California, here’s the tune you’ll be dancin’ to once yer Outa Dodge.
Not only does it rock, but so does your capital growth rate since you saw the light. Massively increase your net worth, tax shelter, flexibility, and best of all? Your retirement income. Purposefully Plan your way to the retirement you deserve.
Step away from the local real estate San Diego. Yer just a 1031 exchange away from jump starting your future back to life. Your retirement is dying a slow death here. Hhellllooooo!
Crank this one up to 11, kick back, and try to remember where you were the first time you heard this one.
Posted on May 22, 2008 @ 10:06 pm - Written by BawldGuy
I was due for the conversation that transpired recently. A friend of a currently inactive client was a few days from entering into a tax deferred exchange. My client called me to ask if I’d talk with their friend about what they were doing and why. Not a problem.
After the conversation with her investor buddy, it occurred to me she had an immediate problem which was easily remedied, but a much larger problem that was systemic. Her tax pro was allowing her to enter into a classic delayed exchange when there was another obviously superior option.
In a nutshell, the investor had unused depreciation in an amount sufficient to offset a pretty impressive hunk of the capital gain she was deferring. In plain English? She’d be able to take out over 1/3 of her net proceeds in cash — without ever paying capital gains taxes. She’d accumulated massive unused depreciation as a result of being barred from using any of it against her ordinary income. (read: job income) Hence, the unused accumulated tax shelter.
By executing a tax deferred exchange (1031) sans the huge tax free cash exit, she’d have been penalizing herself. Read the rest of this entry »
Yer just a 1031 exchange away from jump starting your future back to life. Your retirement is dying a slow death here. Hhellllooooo!