Is This Possible?
I have a spec home that I have been sitting on for a while, currently the market in that area is terrible and builders are dumping homes left and right.......here is the question.
I have a friend who is currently renting a home about 45 - 60 minutes from his business.......my spec home is about 15 - 20 minutes from his business............wondering the feasibility on selling the home at cost, which would be $100,000.00 below current tax value........he live in it for two years, than sells when the market is hopefully more stable (we have a techno-park moving in the nearby area) at which time we split the tax free profits.
Other then gifting my percentage of the profits, which I am not familiar with how that is taxed and to what percent, I wonder if it would be better to create a second note between he and I.
Currently I have this home listed 35k below tax value......by the time the agent gets his cut, there is very little left for me.........makes me sick.
thanks
NC
Builders are also getting hit here in the RTP/Raleigh area. Banks seem to be pulling the plug late in the building process. I feel for the builders as I walk through their 90% finished properties a week before the foreclosure sale.
I would opt for the second note... the splitting of the tax exemption on the primary residence sounds suspect. But check with your accountant....
I did more research on the gift tax / exemptions.......if one wanted to be creative then it could be done........11k to this family member, 11k to another, etc.......but the note would be a better security.
Yeah, several of my subs are not of business already.......I remember when interest rates were 18 - 21%.....but this is a different ball game..........I do believe it will work out but it all reality, it will probably be about 2 - 3 years.
NC
Check with your Chamber of Commerce.
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