Real estate at age 70?

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Boulous
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Joined: Sun May 24, 2020 3:42 pm

Real estate at age 70?

Post by Boulous » Mon Jun 29, 2020 1:58 pm

Hi Bogleheads:
I have done very well in buying and selling properties, I just sold my last rental property that I owned since 1995 and got a good chunk of money for ii after paying capital gains taxes, I read the pros and cons
https://www.investopedia.com/investing/ ... ck-market/ about each,
At my young age of 70, would it be foolish to dive back into real estate brick and mortar?
Or invest my money in a lazy portfolio index funds for less headaches in managing and upkeep of a property given my time horizon of 70 years old?
Thanks for your feedbacks!
Boulous

oldfort
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Re: Real estate at age 70?

Post by oldfort » Mon Jun 29, 2020 2:04 pm

It depends on what type of landlord you are. If you outsource it to a property company go ahead. If you want to be a more hands on landlord who does maintenance himself, you're at an age where your health will start catching up to you.

delamer
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Joined: Tue Feb 08, 2011 6:13 pm

Re: Real estate at age 70?

Post by delamer » Mon Jun 29, 2020 2:09 pm

If you have heirs for whom you want to minimize headaches, stick with index funds.

Alan S.
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Location: Prescott, AZ

Re: Real estate at age 70?

Post by Alan S. » Mon Jun 29, 2020 6:40 pm

Another issue to consider is the Pandemic's effect on such things as rental property demand and rent control. If many people remain out of work and cannot pay their rents, collection can become difficult and rent increases can be curtailed. And it's not as simple as avoiding apartments and houses, since the commercial rental landscape is being affected by mall closures, and work at home programs, so it may be difficult to keep even good quality building rented.

I wouldn't be jumping back into this at 70 unless you discern some great opportunities and expect to enjoy the challenge, and as usual location will always be a key to real estate ownership.

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geerhardusvos
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Re: Real estate at age 70?

Post by geerhardusvos » Mon Jun 29, 2020 6:43 pm

Boulous wrote:
Mon Jun 29, 2020 1:58 pm
Hi Bogleheads:
I have done very well in buying and selling properties, I just sold my last rental property that I owned since 1995 and got a good chunk of money for ii after paying capital gains taxes, I read the pros and cons
https://www.investopedia.com/investing/ ... ck-market/ about each,
At my young age of 70, would it be foolish to dive back into real estate brick and mortar?
Or invest my money in a lazy portfolio index funds for less headaches in managing and upkeep of a property given my time horizon of 70 years old?
Thanks for your feedbacks!
Boulous
I personally would likely want to wind down my overhead and risk in single-family properties. Go with your gut, but I would almost for sure seek the convenience and tax efficiency of a fully passive index fund portfolio. Nice job unwinding that stuff! That’s half or more of the battle
VTSAX and chill

DesertDiva
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Location: In the desert

Re: Real estate at age 70?

Post by DesertDiva » Mon Jun 29, 2020 6:46 pm

:idea: you've earned the right to enjoy your life - why would you want to return to beIng a landlord?

phxjcc
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Re: Real estate at age 70?

Post by phxjcc » Mon Jun 29, 2020 10:38 pm

Boulous wrote:
Mon Jun 29, 2020 1:58 pm
Hi Bogleheads:
I have done very well in buying and selling properties, I just sold my last rental property that I owned since 1995 and got a good chunk of money for ii after paying capital gains taxes, I read the pros and cons
https://www.investopedia.com/investing/ ... ck-market/ about each,
At my young age of 70, would it be foolish to dive back into real estate brick and mortar?
Or invest my money in a lazy portfolio index funds for less headaches in managing and upkeep of a property given my time horizon of 70 years old?
Thanks for your feedbacks!
Boulous
1. From the investopedia article...
"Stocks .....do not require a large cash injection"

Ok.
Got bias? Much?

2. If you are a young 70, go ahead.
My neighbor is 90 and swims an hour each morning and walks 2-5 miles each day.

3. Ask the same question on BIGGERPOCKETS for an amusing contrast in responses.

4. This is a lifestyle choice that only you---and not some stranger on the internet can answer.

TLB
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Joined: Wed Nov 30, 2016 5:04 pm

Re: Real estate at age 70?

Post by TLB » Mon Jun 29, 2020 11:03 pm

If I was going to go back into real estate I would have done a 1031 exchange when you sold your property. It would have saved you on paying capital gains.
I just retired this year with a lot of real estate, residential and commercial which I plan on selling in the next 5 to 10 years. It has been easy to keep up with, just want to minimize my liability down the road.

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Watty
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Re: Real estate at age 70?

Post by Watty » Tue Jun 30, 2020 1:05 am

Boulous wrote:
Mon Jun 29, 2020 1:58 pm
At my young age of 70, would it be foolish to dive back into real estate brick and mortar?
One thing to consider is if having a rental property will really make any difference in your life if it works out well.

For example if you invest 5% of your money in a house and it works out well and you get a good return on that 5% then it will probably not make a significant difference in your finances.

CurlyDave
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Re: Real estate at age 70?

Post by CurlyDave » Tue Jun 30, 2020 1:20 am

oldfort wrote:
Mon Jun 29, 2020 2:04 pm
It depends on what type of landlord you are. If you outsource it to a property company go ahead. If you want to be a more hands on landlord who does maintenance himself, you're at an age where your health will start catching up to you.
There is a huge difference between a "property company" and hiring someone else to do maintenance. Most property managers only screen tenants and collect rents. They might do light maintenance, like changing light bulbs (which they will charge you to do), but anything heavier they farm out to various other companies.

And, property management companies seldom negotiate repair prices as well as I can on my own. For instance, when I get a bid on an HVAC repair I always point out that I own 15 HVAC systems and ought to get a wholesale price. The vendors that play ball get repeat business. Somehow property management companies are less interested in getting good prices -- they just pass them on the the owner.

I am 6 weeks short of 75 and manage our rentals myself. I have a maintenance man and an on-site property manager, but I make final decisions on tenants, set monthly rents, and have overall control. It really is a business and I enjoy the part time activity of running it.
Last edited by CurlyDave on Tue Jun 30, 2020 1:42 am, edited 1 time in total.

CurlyDave
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Re: Real estate at age 70?

Post by CurlyDave » Tue Jun 30, 2020 1:34 am

delamer wrote:
Mon Jun 29, 2020 2:09 pm
If you have heirs for whom you want to minimize headaches, stick with index funds.
Personally, I am holding on to my real estate until the very end. My heirs are going to have to do a little work to sell, but they are going to enjoy the step-up in basis a whole lot more than an index fund which has been depleted by paying taxes on the real estate sale before I ever got to buy a single share.

I recognize that the index fund will also have a step up in basis on my death, but the taxes on the real estate sale in order to switch into the index fund seem to be completely avoidable.

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Sandtrap
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Re: Real estate at age 70?

Post by Sandtrap » Tue Jun 30, 2020 8:29 am

OP
First: Age has nothing to do with this Rather than stage of life or lifestyle change.

There was a reason for selling off your properties.
Why did you change your mind?
Inadequate returns?
Desire to increase assets?
Coming up short in retirement income?
Missing the game?
Boredom?

You don’t have to “dive in”.
Purchase something on the side and index fund the rest.
There’s an assumption of SFH. How large were your holdings and what do you have to work with?

Why did you sell the last property instead of keeping the last one?

Need more info.

Thanks.
j🌺
Wiki Bogleheads Wiki: Everything You Need to Know

delamer
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Re: Real estate at age 70?

Post by delamer » Tue Jun 30, 2020 9:15 am

CurlyDave wrote:
Tue Jun 30, 2020 1:34 am
delamer wrote:
Mon Jun 29, 2020 2:09 pm
If you have heirs for whom you want to minimize headaches, stick with index funds.
Personally, I am holding on to my real estate until the very end. My heirs are going to have to do a little work to sell, but they are going to enjoy the step-up in basis a whole lot more than an index fund which has been depleted by paying taxes on the real estate sale before I ever got to buy a single share.

I recognize that the index fund will also have a step up in basis on my death, but the taxes on the real estate sale in order to switch into the index fund seem to be completely avoidable.
Your situation is different than the OP’s, who is talking about buying a property now. You are planning to hold onto a property that you already own.

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