Selling primary home to use capital for investment property

[Alex Meneses]

Hi BP Community,

My wife and I are planning to put our primary home on sale to move into an apt in a better neighborhood and we would like to use the capital gains towards investment properties.  The apt would be temporary for 1-3 years while we build up our rental property portfolio.  We figure one of the pluses to moving from a 4 bedroom primary home to a two bedroom apt would be the downsize of our monthly expenses.  We would use the time to soak into the new neighborhood and take our time to find our new home.  The ultimate goal is to retire early with enough passive income.  We figure this option would get us started on that path.  Does that make sense?

[Account Closed]

Time is money!

That 1-3 years that you are planning to spend in a 2 BR apartment could be spent in half of a Duplex that you own with 95% FHA financing, with the other tenant paying most of the note payment.

That three years of equity, reinvested using Section 1031 for the next 30 years, could easily turn into half a million dollars.

And your monthly expenses would be even lower.

You would also be building a solid credit history.

Just a thought.

Good Luck on your real estate investing.  

Michael Lantrip