I am currently in the process of a cash-out REFI on my current residence and will be closing on another property shortly afterwards. My intentions are to flip said property. Here is where my dilemma arises. I currently live in a double wide manufactured home. I own the property free and clear. The house recently appraised for $62,000. Once I flip the other property I am purchasing, should I sell my home and purchase another? I feel like living in a double wide I am not getting the most bang for my buck in the long run due to depreciation coupled with banks not wanting to loan money on them. I feel now may the time to sell in order to maximize my investment. If I was to move, it would be into an undervalued/distressed property that I would remodel over time (i.e. house hack). The areas that I am looking in are exponentially better areas for real estate investing than where I currently reside both now and in the years to come. Also if I do move what would be the best way to approach my decision from a tax stand point?
I thought about that but with the extra investment capital, wouldn't selling and reinvesting maximizing my earnings?
Updated about 3 years ago
I thought about that but, with the extra investment capital, wouldn't selling and reinvesting allow me to maximize my earnings in the long run?
If you've been living in the double wide for 2 years of the last 5 you will not have to pay taxes on it because it is your residence, not an investment property.
If you plan to do flipping, then sell and buy is probably the better strategy. If you are trying to build wealth, I'd rent it out and use that income to help fund more investment properties. Just make sure that whatever banks you plan to use will allow you to claim the rental income based on lease. Many of them will not allow it until you've been a landlord for 2 years.
Really it will depend on what your long-term strategy is. Both ways have pros and cons; you have to marry that up to your goals.
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