All Forum Posts by: Mike Wadsley

Rich Dad tax advisor tells us to invest where you like to visit so you can deduct those travel expenses from our taxes!

Denver does require quite a bit of cap to get started. Not sure how long ago you purchased your home here in Denver, but you might be able to take out a HELOC to be able to get a little cap in your pocket.

Hey @Jonathan Ramos, great thread!

From my home builder friends, there is a handful of issues. 

1. The first is getting good help. Keeping a solid crew that does good work and stays on the job, is a challenge. 

2. Liability is a problem. Not sure about laws where you live, but the laws in Colorado make it difficult to limit a builder's liability. As it stands, owners can sue a builder many years down the road. It has bitten some of them in the butt, and they are trying to limit their liability.

3. Material availability. Materials are getting more and more expensive.

4. Cost of land is going up.

There's more, but those are the ones that they mention.

@Thayer McKeith - Welcome to the forums! Thank you for your hard work this past wildfire season!

If you're going to continue your fire duties, make sure you get a good property management company in place to take care of the details while you continue to do what you love.

@Cole Britting - Here's what I'm telling my kids about to go to college.

1. College is for the experience and networking. It doesn't teach you about how to succeed in business. I enjoyed my time in college, but there is no ROI for college.

2. Following the conventional wisdom taught in college will get you a job filing a W-2, paying high taxes, flipping burgers and never getting ahead.

3. Make your money work for you. Don't trade time for money.

4. Read, A LOT! Lean from those who are successful. "Rich Dad" is a great place to start. It turns traditional thought on it's head.

5. People do more to avoid pain than to be successful. Take risks to be great, don't avoid the pain.

6. "Chose your hard." Succeeding in life is hard, but worth it. Failing in life is hard, but sucks when you fail. Playing defense is hard, but gets you stuck in neutral. "Choose your hard"

Hey @Kevin Noonan, Depending on how much cash you have available, investing is still possible in Denver. Don't be afraid to partner with other investors. Money is cheap right now, but it still digs into your profit. Find a group to create an investment group to take the market on.

You do have to be a little creative when finding properties, but they are out there. The inventory on the MLS is low, but the deals still exist where people have unrealistic goals for their asking price. Don't be afraid to troll the MLS for properties that have been sitting on the market too long. They are overpriced and might be willing to negotiate.

It's a numbers game, so don't spend a lot of time analyzing deals. You will get scared off and not pull the trigger. Pulling the trigger and making a little money is still more than $0. You won't always find a touchdown with each one, but a bunch of short passes over the middle do equal one!

Hey @Pras Lee - Aurora and the northern suburbs are going to be your better bets for cash flowing properties.

The Tax Cuts and Jobs Act included a new federal incentive—Opportunity Zones—meant to spur investment in undercapitalized communities. Any corporation or individual with capital gains can qualify. The program provides three tax benefits for investing unrealized capital gains in Opportunity Zones.

The Biggerpockets calculator is an awesome tool to review but it doesn't take into considerations these tax benefits. 

Is anyone including that benefit when evaluating a potential buy and hold property?

@Blake Ramsey - I think you should also consider that the risk associated with a potential increasing vacancy rates as a result of Covid-19 implication could be spread out amongst your assets. 

@Account Closed - Did this go anywhere for you? I've got an investor who's tossing around the idea, too.

@Johnson Yu - I would echo the statement about tax concerns. You'll want to make sure you consider your tax liability and how it relates to FIRPTA. Enforcement around FIRPTA has gained speed in the past four years and it is now part of our standard real estate contracts here in Colorado, USA.

"The sale of an interest in real property within the United States by a “foreign person” is subject to tax liability under Foreign Investment in Real Property Tax Act of 1980 (FIRPTA). FIRPTA authorized the United States to tax foreign persons on dispositions of U.S. real property interests. Generally, any buyer of real property from a foreign individual is required to withhold 15% of the amount realized on the sale. If the seller is a foreign person and the buyer fails to withhold, the buyer may be held liable for the tax."