So here it goes. I own my home in Silicon Valley. It’s worth around $1 million. I owe around $450k. I could rent it out and make about $1k/month.
I am moving out of the area and am going back and forth between selling it and paying cash for a house elsewhere, which would be around $500k. I would then start with substantially cheaper homes to invest in where I am going.
My question is this. Should I keep the house and use it as an investment and buy another home to live in?
Or sell it? Having the opportunity to own my next home outright. Then begin investing from there.
Let me know if this is in the wrong area. Any advice is appreciated.
Hi @Matt Sobers ,
Welcome to BP! If I were you I would buy a primary residence elsewhere (the lower the down payment the better as long as you are comfortable with the numbers) and rent out your current Silicon Valley place. In the future (not sure how long in future for your Silicon Valley place to legally be considered a rental from a 1031 perspective), you can do a 1031 exchange to buy a new rental property. This would save you a ton with taxes - although it is in your best interest to speak with an accountant who can run the numbers for the different scenarios.
Sorry it has been a while. Thank you gentlemen who replied. I appreciate the assistance.