Investing in Real Estate with Your IRA
By Desert Dog on Jul 21, 2009 with Comments 0
Many investors are surprised when I tell them that they can buy real estate in their IRA. 
The big brokers and mutual fund companies don’t advertise this fact because frankly they don’t want to lose the business. Actually, you can invest in almost anything with your IRA as long as you follow the IRS rules. One strategy I’d like to try is to find a company that needs new equipment or furniture, buy it, and then sell it to them on a rent-to-own program. I just don’t have the time to branch off into something like that right now. Instead, I wrote an article on real estate investing with your IRA that you can read HERE.
Why not just stay invested in stocks and mutual funds? Seriously, have you looked at your broker statements lately? My buy and hold accounts are back down at 2000-2001 levels, which means that I have lost nine years of valuable time in my retirement funds!
I have more details in the article, but I compared the Dow and Median Home Price from January 1999 to January 2009. Real estate beat the Dow, gaining a staggering 56% during the decade while the Dow lost 5%, and that is with the worst housing bubble burst in our country’s history!
Somebody once told me, “You can make money in the stock market, but you build wealth in real estate.” That was certainly true over the last ten years!
Take some time and research “self-directed IRAs” on the internet and find a good IRA custodian. Talk to other investors and ask who they prefer. Then sit down and map out your goals. Your IRA is a great place for Fix & Flips because you don’t have to worry about the tax consequences of an extra $30,000 in ordinary income.
One word of caution. Keep a conservative operating reserve in your IRA. You can’t just write a check if you need a new furnace or need to evict a tenant, so make sure you keep enough back to cover your contingencies!
For more information you can find the the full article HERE.
© 2009, The Desert Dog Journal. All rights reserved.
Related posts:
Filed Under: Investing • Real Estate
