usctrojancpa
Well-known member
Irvine home appreciation outperformed Georgia appreciation by a big margin since Covid. Yes Irvine is expensive but any desirable is expensive and will continue to be expensive.
Orchard Hills 4 - "The Summit" Updates
- Thread starter ratchet_resident
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NEW -> Contingent Buyer Assistance Program
Irvine home appreciation outperformed Georgia appreciation by a big margin since Covid. Yes Irvine is expensive but any desirable is expensive and will continue to be expensive.
I can contribute up to 25% of my net income to a SEP IRA up to $69,000 in 2024 so it's even better than a 401k which has lower limits. I'm been maxing out my SEP IRA contributions for the past 15 years.
Yes, over that was required for qualify to purchase the home. Being self employed and getting a loan is not a pleasant process, they probe very deep.
Any creative discussion points or just just calculating capital gains (15/20% + 3.8% NIIT + 9.3% CA ) tax will be owed above $500k?
Before a calculation of the tax there needs to be a deep dive into calculating the basis of the home by looking at closing costs paid at the time of purchase, tallying up all improvements made to the home (this includes any personal property that is sold like refrigerator/s, W/D, furniture, etc), and then the costs to get the home ready to sell along with the closing costs. Also, there's a bit of a loophole where if you rent a sell your primary residence after renting it for 2 years but before 3 years from departing it you can take your $500k gain exemption cash out tax free and do a 1031 exchange into another rental property. After renting the move-up 1031 exchange purchase you can convert the home into your primary and keep deferring the gains and accumulated depreciation.
Yeah, I'm up to my eyeballs in loans but most all of my loans are real estate loans so those loans creative positive leverage for long-term appreciating assets.
Irvine home appreciation outperformed Georgia appreciation by a big margin since Covid. Yes Irvine is expensive but any desirable is expensive and will continue to be expensive.
That is Irvine speed! Go, Irvine!
usctrojancpa
Well-known member
I paid $4m for my home with $1m down (could have put more but wanted to stay liquid to help my contingent buyers). My all-in housing cost is not for the faint of heart or wallet...
$14k/mo mortgage
$3.5k/mo property tax
$240/mo insurance (I'm sure this will be going up when I get my renewal in June)
$185/mo HOA
$150/mo for the pool guy
$150/mo for the gardener
Funny thing is that even though I have a single story home, I have an upstairs loft which I don't use. I'll live in this home until I retire as it checks all of the boxes that I was looking for, including the 3-car garage.
$14k/mo mortgage
$3.5k/mo property tax
$240/mo insurance (I'm sure this will be going up when I get my renewal in June)
$185/mo HOA
$150/mo for the pool guy
$150/mo for the gardener
Funny thing is that even though I have a single story home, I have an upstairs loft which I don't use. I'll live in this home until I retire as it checks all of the boxes that I was looking for, including the 3-car garage.
sleepy5136
Well-known member
I'm assuming since you're self employed you don't have a way to maximize the 401k contributions? How do you go about saving for retirement? I know you can always do a max of 7k backdoor roth but besides that what options do you have
usctrojancpa
Well-known member
I can contribute up to 25% of my net income to a SEP IRA up to $69,000 in 2024 so it's even better than a 401k which has lower limits. I'm been maxing out my SEP IRA contributions for the past 15 years.
You must have been making at least $500k per year to qualify for a $3m loan.
qwerty
Well-known member
USC has 500k under his couch cushions
usctrojancpa
Well-known member
Yes, over that was required for qualify to purchase the home. Being self employed and getting a loan is not a pleasant process, they probe very deep.
usctrojancpa
Well-known member
usctrojancpa
Well-known member
The interesting thing that I've been running into with more and more of my sellers now is that their gains are north of $500k so analyzing the tax situation is becomes a very important discussion. A lot of those sellers are selling and moving that equity into their next purchase to keep the mortgage amounts very manageable. When it's time to retire, I'll most likely move to Las Vegas and take the net sales proceeds from the sale of my home and buy a home out there for all cash to not have a mortgage.
scubasteve
Active member
Balance sheet poor!
Imnotmoving
Member
Not balance sheet poor. He is parking 14k a month in a secured asset that is increasing in value. He can’t lose.
woodburyowner
Well-known member
Any creative discussion points or just just calculating capital gains (15/20% + 3.8% NIIT + 9.3% CA ) tax will be owed above $500k?
usctrojancpa
Well-known member
Before a calculation of the tax there needs to be a deep dive into calculating the basis of the home by looking at closing costs paid at the time of purchase, tallying up all improvements made to the home (this includes any personal property that is sold like refrigerator/s, W/D, furniture, etc), and then the costs to get the home ready to sell along with the closing costs. Also, there's a bit of a loophole where if you rent a sell your primary residence after renting it for 2 years but before 3 years from departing it you can take your $500k gain exemption cash out tax free and do a 1031 exchange into another rental property. After renting the move-up 1031 exchange purchase you can convert the home into your primary and keep deferring the gains and accumulated depreciation.
usctrojancpa
Well-known member
Yeah, I'm up to my eyeballs in loans but most all of my loans are real estate loans so those loans creative positive leverage for long-term appreciating assets.
sleepy5136
Well-known member
Do you ever feel like you're over leveraged in one particular sector?
vsfan
Active member
Watch Tony, go find in the bird feeder!
scubasteve
Active member
should've added a "/s" for those that are late to the thread... @Martin - you know I know what you are doing!
The Motor Court Company
Well-known member
for me yes. let's just say CalBears and I have shared the same certain financial interests.
panda
Well-known member
C'mon UscTrojancpa,
You can't compare the appreciation of Irvine vs the entire state or Georgia. That is like comparing the appreciation of the top affluent zip codes and cities of North Atlanta vs the entire state of California.
I disagree that the Irvine home appreciation outperformed the "Irvine" like cities in Georgia in terms of demographics, top schools, and income by a big margin. Show me your data analysis, chart of Irvine from Covid and I will show you mine. Let's see who is correct. I can compare the home appreciation of an entire county in North Atlanta with similar median income, population size, and demographics with Irvine. Probably the same appreciation as Irvine, but certainly not beat by a wide margin like you mentioned.
You can't compare the appreciation of Irvine vs the entire state or Georgia. That is like comparing the appreciation of the top affluent zip codes and cities of North Atlanta vs the entire state of California.
I disagree that the Irvine home appreciation outperformed the "Irvine" like cities in Georgia in terms of demographics, top schools, and income by a big margin. Show me your data analysis, chart of Irvine from Covid and I will show you mine. Let's see who is correct. I can compare the home appreciation of an entire county in North Atlanta with similar median income, population size, and demographics with Irvine. Probably the same appreciation as Irvine, but certainly not beat by a wide margin like you mentioned.