arebelspy, if you are a seasoned professional, that is a totally different ball game. Hurricane0884 is a newby, so he/she should not flip unless...
I would argue that one should treat it like a business just as the professionals would. I would complete your sentence with "he gets the required knowledge" - there are numerous ways to do this.
Newby's watch this: http://www.youtube.com/watch?v=EudeRC3p5rQ
Come on. This guy is saying buying at 40% of ARV (typical rule of thumb is 60-70%) is not going to be worth it.
Ridiculous.
So he eventually advocates wholesaling it to another investor, who would then fail even harder than you would (because he says you'll only make 11k, so if they pay you 10k, they would only make 1k). He's saying it's not worth it for you to rehab, but it is for someone else, or else you're looking for a greater fool (if you buy into his idea that flipping is foolish), or if they're a contractor who can save on the rehab costs. (How about this: partner with a contractor for a win-win.)
This guy has a wholesaling mentoring course he wants to sell. What a shock he's pushing wholesaling.
Yes, if your flipping you get in and get out ASAP, but that is not what I suggested. Buy a good property in a desirable area as your primary residence, fix it up, live in it min. 2 out of 5 yr.'s (you can rent inbetween) and walk away with a pocketful tax free. SIMPLE.
Yes, flipping is what we were talking about, then you changed to something that is not flipping. Also your idea of living in it to make it tax free is flat out
false. It's not tax free, it's prorated based on the amount of time you lived there out of the past 5 (so only some of the taxes are sheltered). Your incorrect tax advice could get someone in a lot of trouble.
Yes, there are restrictions with adding Realestate, but I thought I would mention it because it is a cool concept.
Yes, and the biggest restriction is you
can't live in it, you
can't repair it yourself, etc. To mention the idea in the same post as talking about how someone should live in a home and repair it is misleading, at best. Another thing that could get someone in a lot of trouble.
I can't decide if you're trolling, or just mistaken with a lot of these things. Your initial posts on the forum led a lot of people to call you on trolling, but I decided to leave it alone.
But please stop offering incorrect advice regarding taxes and real estate investing. It's really, really dangerous, and you have done it multiple times, often in a single post.
To anyone reading this: please consult your own attorney and CPA, and don't listen to random yahoos on the internet, myself included.
I really wish more people would heed this advice, so I could make more money on flips. :-)
Yeah, I just hate to see people spread
FUD.