My tax preparer suggested that it was time for me to buy a home. I don't need to live in the home and want to use it as an investment. I've been thinking about a condo, buying land and building a modular home, or vacation property, and using it for short-term rentals. I was told not to purchase a condo/townhome as the resale is often difficult. Any thoughts for a newbie. I live in S. Cal.
"Resale is often difficult" is misleading. It is 100% market dependent and property dependent. I own only condo's at it has allowed me to build a small portfolio of affordable vacation rentals on the beach for people who want to vacation. These are in the midst of appreciating like crazy as our local market booms. I also would not purchase in Cali with the rules and prices there, but I am also lucky to have a good market in SE Texas that still has opportunity to buy at reasonable prices.
@Dwana Willis what can make condos and townhomes more difficult is the HOA. For reference Townhomes own the land they sit on where a condo does not include any land. Buying land and building can be fun or can be frustrating depending on if you like the whole process. I would reach out to some agents in the area you are planning on doing this and get their advice while also reading up on forms here and seeing what type of investment you would like to own. Each category has its pros and cons. STR (Short Term Rental) can have higher returns and also allow you a place to vacation, but maybe more of a hands-on investment if you don't have a solid management company. Where LTR (Long Term Rental) can be more passive, however, you don't get to use the property when you want to.
My personal thoughts are don't buy anything for a tax break if you wouldn't buy it without a tax break. Real Estate isn't for everyone but is the greatest wealth-building tool available, and just happens to be a source of tax breaks.
Look into Gatlinburg, TN or Pigeon Forge, TN near Smokey Mountains for short term rental markets. You will be able to find land, build a home and make it s STR. Good luck!
Thank you everyone for your thoughts. I need to dig deeper into each category. I agree, Chris, I want to do start investing in real estate, I just need to figure out what to buy and where.