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DDDDave · 05-10-2007, 09:05 AM

Good article, llow.

Xeph, I admire your drive but listen to the folks who have done this before. Take some courses. I always advise people to take a course on RE Appraising. It will give you a lot of knowledge about the factors that go into value, including analyzing particular markets. I obviously don't know your personal situation, but if I was able to start from scratch, I would start right where you are now, Arizona. There are several good local markets there right now and it is a place people are moving into, not out of.

""If I have to sit on a house for a few months and take the capital gains hit, it's not ideal, but it's still profitable."" I'm not sure what you mean by this. You do understand that the only way you can get by with paying 'no' tax is to live in the house, right? Which basically means you can only do one at a time and your family will have to move often and live in a 'constantly being fixed up' house. If you do one a year, you will pay 15% capital gains tax on your profit. If you buy, fix up, and sell within one year you will pay ordinary income rates and will be categorized by the IRS as a 'dealer'. Depending on lots of other factors, your tax rate will be in the 28% to 35% range.

Once again, good luck. It is a great business but one that you must go into with your eyes open and with an abundance of caution.

05-10-2007, 09:05 AM	#17 (permalink)
DDDDave Addict Location: Sarasota	Good article, llow. Xeph, I admire your drive but listen to the folks who have done this before. Take some courses. I always advise people to take a course on RE Appraising. It will give you a lot of knowledge about the factors that go into value, including analyzing particular markets. I obviously don't know your personal situation, but if I was able to start from scratch, I would start right where you are now, Arizona. There are several good local markets there right now and it is a place people are moving into, not out of. ""If I have to sit on a house for a few months and take the capital gains hit, it's not ideal, but it's still profitable."" I'm not sure what you mean by this. You do understand that the only way you can get by with paying 'no' tax is to live in the house, right? Which basically means you can only do one at a time and your family will have to move often and live in a 'constantly being fixed up' house. If you do one a year, you will pay 15% capital gains tax on your profit. If you buy, fix up, and sell within one year you will pay ordinary income rates and will be categorized by the IRS as a 'dealer'. Depending on lots of other factors, your tax rate will be in the 28% to 35% range. Once again, good luck. It is a great business but one that you must go into with your eyes open and with an abundance of caution. __________________ I am just a simple man trying to make my way in the universe... "Go confidently in the direction of your dreams. Live the life you have imagined." - Thoreau "Nothing great was ever accomplished without enthusiasm" - Emerson Last edited by DDDDave; 05-10-2007 at 11:35 AM..