Hey guys, welcome to the investors guide of Memphis real estate. I'm your host Dean
Harris and as always, I'm with Douglas Skippworth. How are you buddy? Hey man doing great. We're
bringing you this podcast to give you the boots on the ground knowledge to be a successful
real estate investor here in Memphis, Tennessee. Please like and subscribe to all of all of
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screen below. We would not be able to run our rental business or do this show without
these guys. Trump construction, river city title, core, live financial, Crestcore property
management and we'll Griffin with Griffin, Clifton, Everton and Mashmire. I help buyers
and sellers every day. Dean at Crestcore.com. If you have anything to sell here in Memphis,
if you have anything you'd like to buy, we'll put you on our buyer profile. You can start
seeing all the deals that we source every day. How's it going? Great. Yeah. Yeah. It's
exciting time fall. Yes. You know, it's rates are going down. Yeah. Opportunities are around.
Our podcast was great about, you know, not wasting an opportunity and what we're, what
we're right in the middle of now. This is another one. Today's topic is another one
that I hit every time of the year this year. And it's, it's, do you need to buy before
the end of the year? And, and that's a broad question, but we're going to get to the specifics
of why. A lot of investors are out there and they're successful in their own business.
They've got income coming in and they're, they're independently wealthy or semi-wealthy
or whatever you want to call it on their own, right? This is a side gig, a, a retirement
plan, a diversification method. And oftentimes in, in high income situations, you need tax
write-offs. You need to defer your tax obligation somehow or another and housing and rentals
is a very popular way to do that. Every year at this time of year, I get a group of investors
that come to me. And it's usually too late. Right. That's what he's going to say. It's
usually in December and they've had their conversation with their CPA or their accountant
and they've, they go, Oh man, I need to, I should have bought X and minus dollars worth
the real estate to help defer this because of our tax laws. We're so good for purchasing
real estate, depreciation and all that. So today we're going to talk about getting ahead
of that and what you should do to try to get yourself aware of the very first thing I have
is call your CPA today right now. It's mid to late October. Yes. Call them right now.
We have enough time if you'll get on the phone with them now. Hey, what do I need to do?
I'm going to make about this much money. By the way, I did this myself last week. I'm
going to make about this much money this year. I'm going to earn this much roughly. I bought
this much real estate so far and I don't have many other, whatever you got, how much more
real estate do I need to buy to try to save some of my own cash? Right. Yeah. So that,
that'd be my first call today is to get to your CPA on the phone and figure out where
you're at. I love it. I mean, I feel like this is a topic we've, I was like, I don't
remember ever talking about this. This is brilliant. Yeah. And something that is beneficial
and that you're here. It's one of those things that you hear this often, but you don't bring
it here on the air and share it with everybody. That's right. So I'm glad you are because
it's great advice. It's like, Oh man, I know exactly what you're talking about. Yeah. I've
been there. I've had that, those conversations had that conversation where you're like, Oh
man, here it is. It's too, you're rushing. Now you can have a little plan into it and
think about how I'm going to end this year with the opportunity we talked about last
week. They usually call me about December 10th. Yeah. Hey man, how's it going? Yeah,
great. Good to talk to you. Yeah. I need to, I need to buy a house. It's the flip side
of that also happens with, um, that's why December is such a big donation, giving month
for charities because people at the end of the year, they're like, Oh, I need to give,
I'm going to give it away, write it off. Here it is, my chance. Got to get it in. Got to
get it in. And it's a scramble for those nonprofits to receive that money. And what you're saying
is the same thing. People are scrambling. It's just a lot easier to write a check to
give, you know, to a donation to somebody than just to buy a house. Oh man, I need,
we need time. You need time. Even with hard money, you need two weeks. Yeah. And even
then it's like, we don't need to make a decision mid December at the middle of the holidays.
God no, man. You know, I'm not saying it's going to be a bad one, but it'll be one under
distress. Yes. It'll be one of less leverage. Yeah. It'll be one of not to mention all the
with closing appraisals and closing attorneys and financiers and whoever, other agents, like
people are just using the holidays for family time and other time. So it's harder to connect
and coordinate. It's harder to get anybody to do anything after December the 15th. Let's
just call it what it is. That's a great way to say you can't hardly get anyone to do anything.
And it, and it's, and, and this year, the date falls again, where it's going to be wacky.
Like in the middle of the week kind of thing, both do Christmas and then New Year's. It's
got some Thursdays. I think this year, last week, Wednesday, right? Right. That just this
year's on Thursday. So it's still going to be, you might get something out of somebody
on Monday. Maybe, but they might not be working at the end of the week. You're working the
beginning of the week. So the whole point is to start now. Yeah. Start now. Let's have
some time to sort this out for a couple of weeks. And then if we're still going to get
a loan, we can still do it. I mean, like we've got almost a Thanksgiving to, to get something
written up and under contract if we're going to obtain a loan. Yeah. We probably have until
about December the 5th, 6th, 7th, if we're going to do a cash deal and you need 21 days
to do it, something around there. You just need, I just don't want to try to rush at
the end of the year and try to make something happen and let somebody down. Yeah. When we've
got time, you can't tell me now you got time. You got time. So if you'll, if you're using
a loan, yeah, make sure that we need to know now for cash, you can come a little bit closer.
Get with your bankers, management companies, you know, whoever you're getting a deal from,
I would definitely speak to my property management company. I'd let them know what I'm doing.
I'm going to onboard a few more, get with your banks, be prepared. Obviously they need
to know what you're trying to do before the end of the year. So this isn't a lengthy podcast
today. This isn't anything where, where there's just a ton of depth to this. What I'm trying
to do is sound an alarm. Yeah. And if you are that higher net worth person and you're
a real estate investor or want to be, and you've thought about now's the time to even
get started with that. You've got some heavy tax benefits that you can take advantage of.
To offset. Yeah. I mean, I feel like, I feel like this is the, this is the conference,
we're in the conference room. This is the conference room poster, you know, planning,
you know, failing to plan is planning to fail. You know, it's like, there it is. So
that's where we're saying, um, I thought you had to pay $2,500 for that. Yeah, that's
right. Yeah. Yeah, exactly. Right. So that's, I mean, that's all we can talk about just
doing, doing some planning. And I think that is really wise. And I think you said it well
too is like, Hey, this is obviously for a seasoned investor, but every investor who
starts wants to be, you know, here's the other one. Here's the two posters. Here's the other
poster of, uh, you, you know, you don't have to be great to start, but you have to start
to be great. So look at all that. There it is, man. Like you're cliche one on one. Yes.
But I think that's what we're saying right here for our investors is like, Hey, if you're
seasoned, great. If you're not, ask, ask and listen and learn about cost segregation.
Okay. That's a way to, first of all, depreciation, um, the golly even before that tax benefits.
So tax benefits, there's deferring taxes, which you kind of mentioned. So you can defer taxes
through a 10 31 exchange. We get a lot of investors who buy a property. I'll do that
frequently. Frequently. Right. And so that's something that as an experienced investor,
Dean works with, if you need a 10 31 exchange, Dean can help you. If you're a new investor
or learning about that, put this on your radar and learn about it. And Dean can help you
learn and do that. Then there are things like cost segregation, depreciation. So you can
straight line depreciation where it's kind of sequentially, you know, at a kind of equal
increments, or you can cost sag and in take different components of your property and
depreciate those faster, which all that means is you get a quicker tax deduction so that
if you made income of $100,000 and you took depreciation of a thousand bucks, maybe you
can take depreciation of $5,000. And so it reduces your adjustable gross and all technical
accounting terms. But the point being, you're writing Uncle Sam a smaller check for the same
amount of effort. And you obtain a property. And you get a property there. Yeah. Yeah. I mean,
every year I'm having this conversation right now. What do I need to do? Yes. Matter of
fact, I buy historically the last four or five years, I've bought more properties from
September to December than in any other time during the year. It's interesting. It is interesting.
I should probably look at that and flip it up. I bet I'm missing deals at the first of
the year because I'm maybe a little eyes are a little more closed, trying to focus on it.
But I think you're one of those who are thinking, knowing you, you're super busy trying to serve
your customers, clients, buyers, sellers in the first of the year. That's what you're
doing. And then all of a sudden you're like, Oh, wait, I got to take care of myself. Like
I haven't even taken care of myself. I need to look up and you're like the end of the
year's coming. I need to buy some because I'm having a good year and I need to do some
purchasing and all of the things to the tax advantages and opportunities. And inevitably
I find deals, which is what I keep trying to tell people. It's like this time of year
that is a great time to buy. I mean, uh, guys are taking time off. Here's what I'll tell
you. And I know what's coming and I'll tell you now. This is the 22nd when I don't know
when this will hit because we recorded 20 second. Once Thanksgiving, I mean, once Halloween
is over, yes, it begins to shrink. And once Thanksgiving gets here, it's pretty much over
for a lot of folks over no phone calls, no emails, Dean. I'm done. We're doing this,
that and the other.
I mean, I know people who take the last two weeks off completely from work and completely
much less. Are we buying any real estate to close during then? No. Yeah. So that's where
opportunities present themselves. And this is, this is one right now. So talked with
your CPA, talk with your property source, shame on you. Yeah. Yeah. Talk to Dean, talk
to, talk to, figure out what's out there right now to buy. What price points right after
you speak to your CPA and you get a plan together, then call me and then let's get active. Hey,
that's good. And also one thing we talk about it's like, talk to Dean, talk to your property
manager because they know sellers and we didn't even talk about this. There are certain sellers
who want to sell before the end of the year. That's what I'm saying. The deals are there.
So ask if there's a deal out there. Hey, Dean, you know a seller who needs to sell before
the end of the year in this area. Hey, property manager, do you know somebody who's in your,
who's trying to get out this year? Because there are, there are opportunities. And if,
if you put those buyers and sellers together, my chef's kiss, great episode. No, I like
that. I mean, I thought this was a good one. I don't, I don't believe we've done this topic
before. Never. We haven't talked to him. It's like, this is a great thing that you deal with
all the time that we, every year it's getting more and more and more. I'm having more people
call me towards the end of December. I mean, the end of November and first of December,
I'm like, let's back that up a few weeks and just give us a little bit more of a, of a runway.
I love that. I mean, you're always hearing stuff about 1031s, cost sag, depreciation,
constant tax, tax benefits, makes sense. Thanks, man. Hey, anything, if you guys have on this,
[email protected], appreciate you listening. See you next time.
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