Physicians with Large REI Portfolios

[CAPFUNDR]

The reason that some people make a lot of money in real estate is that it's an inefficient market. Unlike the stock market there is no publicly available information and no gaggle of analysts following a particular property.

What does this mean for you? Unless you have very local and specific knowledge of a property, and the time to keep informed about it, you are at a disadvantage relative to others who do this for a living.They have the right connections to get the inside scoop, and the time to thoroughly analyze the market, know what the competition is doing, what new supply is coming onstream, etc. So, I would say start with a more passive form of real estate investment that is professionally managed. When you have learned from watching these investments, and when you are ready to step back from your practice and devote the bulk of your time to real estate investing, then it might be time to consider investing directly in properties.

WCI has a good article on different investment options. I also wrote one which is posted on my company's website:

http://marketing.capfundr.com/real-estate-investment-options-in-2016/

[NJDoc]

To my knowledge and based on my experience the tax implications of being a limited partner vs outright owning a smaller entity on your own are similar. I do not pretend to know all nuances of the tax laws. But, the syndicated deal I put together and the others I have invested in have all been structured wherein the investors are limited partners. Taxable cash flows are minimized by depreciation ( deferred of course until reversion) , but nonetheless minimal. But that depends on what type of deals the entity is doing, i.e.) fix and flip vs buying and holding a cash flowing asset, wherein capital gains taxes may apply to the former.

 

 

[Gas_Doc]

NJDoc wrote:

At age 52, I don’t want the hassle of management and have simplified by working with well established syndicators with a strong track record. Checks come in and I go sailing…

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Which syndicators have you had good experiences with in the past? What are the tax implications of syndicated deals vs owning a property outright? Can someone use IRA money for syndicated deals?

[NJDoc]

Personally, I found investing in single family homes very time consuming and frustrating. I lost some money, learned a ton and drove my wife crazy trying to rent, evict tenants, maintain the buildings, etc.. When I moved to multi family and office, life became simpler. I don't know what you consider a large portfolio, mine is not large in my opinion but growing. At age 52, I don't want the hassle of management and have simplified by working with well established syndicators with a strong track record. Checks come in and I go sailing...

[YYjames]

1. Everyone would say THIS  but I've found THIS to be helpful

2. Eh I feel like since high school I've had a side hobby/obsession. Its an ADHD thing; I do one thing but think about the other. I took english poetry but I was thinking about quantum mechanics. Anyways, point being while in medicine, I still have the itch to learn other thing and this is what I have noticed in people who do multiple things/have multiple sources of income. I would suggest having a trusted business partner to help the transition.

3. Wife: show her the money. On a serious note, involve her and present it as a fun activity/excersize to gauge left side of the brain.

[Gas_Doc]

How did you get started?

What books do you recommend for a physician interested in REI?

How do you balance your full-time medical career with an investment that takes more time & effort than Indexing?

Most importantly, how did you convince your spouse to agree to the leap in REI?