Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

How to Make Millions From U.S. Real Estate Market Without Paying Taxes

Housing-Market / US Housing Mar 16, 2013 - 11:40 AM GMT

By: Investment_U

Housing-Market

Mark Skousen writes: “How do you make a million? Borrow a million, invest it in real estate, and pay it off.” - Jack Miller

I just returned from a weeklong Royal Caribbean cruise on the “Freedom of the Seas” (great ship) sponsored by The Real Estate Guys Robert Helms and Russell Gray, who have their own radio show and are regular speakers at FreedomFest. Most of my family joined me and we had a great time.


For me, the highlight was a debate on “Which Investment Asset is Best: Stocks, Bonds, Gold/Commodities, or Real Estate?”

They each have their pros and cons.

I have invested in all four categories, but I think stocks are the best way to go because of their variety, profit potential (both short and long term), tax breaks and liquidity. And right now stocks are the hottest investments, with the Dow hitting a new high almost every day.

But most of the speakers on this cruise were experts in real estate. As an investment class, it still suffers from several negatives, especially:

  1. Liquidity (ability to sell quickly)
  1. High levels of debt
  1. A large amount of paperwork and transaction fees

My wife and I just went through a refinancing of our mortgage and it was insane what the bank demanded from us – in additional paperwork and fees.

Buying and selling a stock may cost pennies, but a real estate transaction will cost thousands in closing costs.

A better alternative is to invest in real estate stocks. These offer much better liquidity, high profit potential and generous positive cash flow – without all the transaction expenses and landlord headaches. And if another collapse in property is heading your way, like what happened in 2008, it’s much easier to sell a stock certificate than a property deed.

My favorite real estate stocks right now are: Equity Residential (NYSE: EQR), which invests in apartments; Inland Real Estate (NYSE: IRC), which specializes in shopping centers; Medical Properties Trust (NYSE: MPW), which invests in hospitals; and Health Trust of America (NYSE: HTA), which owns nursing homes. Real estate related to healthcare is hot right now because of Obamacare and an aging population.

Despite all the negatives, investing in rental properties still has a certain allure to investors, especially those who are down on their luck and want to make a lot of money fast. The fact is real estate still offers a person the chance to turn a small investment into a large one fairly quickly if you play your cards right and are willing to be an entrepreneur in the face of high risks.

For example, I met one attendee on the cruise who had only a few dollars to his name, yet was able to buy a dozen properties with nothing down over the course of a few years and leverage his way to a wealthy lifestyle – enough to come on an expensive cruise to the Caribbean.

The only way to do this, of course, is by using owner financing. That is, by arranging for the seller to hold the mortgage and even to finance the closing costs. In today’s world, commercial banks no longer allow “no doc,” or subprime loans (outside of the FHA!).

Creative real estate investors reduce or eliminate their taxes primarily by taking advantage of generous depreciation rules on their rental properties. Tom Wheelright, CPA and author of Tax Free Wealth, specializes in devising powerful tax deductions. He gave several talks on the cruise on how to leverage your way to tax-free profits if you know how to use the tax code to your advantage.

Good Investing, AEIOU,

Mark

Early Bird Special Ends This Weekend for FreedomFest!

P.S. The Real Estate Guys are returning to FreedomFest this July 10-13, at Caesars Palace. They loved our two-minute video preview, “Are We Rome?” – you can watch it here: http://vimeo.com/45821274

Good Investing, AEIOU,

Source : http://www.investmentu.com/2013/March/make-millions-in-real-estate-without-paying-taxes.html

by Mark Skousen

http://www.investmentu.com

Copyright © 1999 - 2008 by The Oxford Club, L.L.C All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Investment U, Attn: Member Services , 105 West Monument Street, Baltimore, MD 21201 Email: CustomerService@InvestmentU.com

Disclaimer: Investment U Disclaimer: Nothing published by Investment U should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investment advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Investment U should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Investment U Archive

© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in