Watch This BEFORE You Turn Your House Into a Rental Property
31,171
Published 2024-03-10
As always, David and Rob are here to answer your pressing real estate investing questions. But resident yacht tycoon James Dainard also brings his twenty years of investing experience to the show to help this week’s rookie real estate investors. First, our very own Noah Bacon asks what he should do with a negative cash-flowing house hack that has six figures in tax-free equity. Then, we ask a question everyone wants an answer to, “WTF is wrong with investors these days?” If you want to turn your house into a rental property, stick around because two more investors ask whether it’s worth it AND when you can start writing off those lucrative real estate tax deductions.
Want to ask David a question? If so, submit your question here (www.biggerpockets.com/david?utm_source=youtube&utm…) so David can answer it on the next episode of Seeing Greene. Hop on the BiggerPockets forums and ask other investors their take, or follow David on Instagram to see when he’s going live so you can jump on a live Q&A and get your question answered on the spot!
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Show notes at: link.chtbl.com/BPRE
00:00 Intro
01:38 My Rental is Losing Money!
10:35 STOP Looking for CASH FLOW
15:24 WTF is Wrong With Investors?
22:19 Why Do High-Priced Homes Appreciate Faster?
26:45 Primary Won't Make a Good Rental?
30:03 When Can I Start Expensing Rental Costs?
32:55 Ask Us Your Question
All Comments (21)
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I love that Rob just called his CPA on the phone and we got to hear a CPA’s professional opinion and thought process on the situation. Pretty cool. High value content for sure. 🔥🔥
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It is hard to find a market where you can get good appreciation and good cash flow. You need to decide what your goals are, and if you want to hold homes and live off of cash flow forever or just a few years and then sell for a large lump sum (or 1031). If you want to hold rentals for long term, you need to buy in a cheaper market and look for good cash flow. Equity does not matter that much in these cases, however when you have built some equity, cash out refi the place and buy another. If you want to sell and get good appreciation buy in a higher priced market, but expect less or even no cash flow.
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That last one hit the spot for me. Doing the same thing. We listed as soon as we closed on our next primary residence and had tenants signing within 5 days for our MTR! 🎉🎉
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RE cash flow vs appreciation is the same as stock dividend vs growth. Some like one vs the other, and some prefer getting both. Getting both, however, generally mean your appreciate/growth and cash flow/dividend won't be as high as if you chose one or the other.
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Always happy to help man!
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Great content today as always and the value is really appreciated. Raul el Realtor de Chicago.
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Great show today and always! Thank you BP❤
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This was a great show thank you
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The video I have been waiting for...
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Watching from Kazakhstan
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Food has doubled and tripled in NYC
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HOA and property tax increases in the last two years are untenable and will eventually end up eroding the buffer for emergencies. Unless you double down, the only safe move is to cap out while property values are still high.
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I don't think the point at 10:53 is accurate. I'm in a similar house hacking situation and you should only be able to take the homeowner exemption on the portion that you live in. If you're renting out 4/5 rooms and living in one, it means only 20% of the capital gains would be avoided. I just don't want anyone to get slapped with a big unforeseen tax hit or an audit.
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Actually it’s beyond free , it’s priceless , my real estate IQ has increased immensely ever since I started listening to your podcast regularly
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I love you podcast I would like to submit a question , how I can get there.
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Hey question… why don’t y’all make a BP app? There is an app for everything in this world it seems like but there is not one for investors or at least I have not come across any!
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What are your guys thoughts on how 3d printed houses and AGI will effect real estate investing?
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What do you think AGI will effect the job market and real estate investing?
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Property taxes DOUBLED from 2022. Any problem solving strategies for that situation?
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Hey beloved people that’s not true my cash return is 43% and I’m only renting
