The stock market is crashing while real estate continues to rise, but you do not have enough liquidity for a down payment.
QUESTION: Is this the time to Invest?
Nowadays, you may wonder if this is the time to invest in real estate through your IRA, Roth IRA, or SEP-IRA.
DO’S: Invest in real estate only if you establish a self-directed IRA with a custodian that allows self-directed investments.
DONT’S: You CAN’T invest in real estate with a traditional IRA or Roth IRA you establish with a bank, brokerage, or trust company. These IRA custodians limit you to a narrow range of investments, such as publicly traded stocks, bonds, mutual funds, ETFs, and CDs.
The self-directed IRA can be used for all types of real estate investments, such as:
- Multi-family rental properties,
- Single-family homes,
- Commercial rentals,
- And More…
You can diversify your retirement holdings and get some tax advantages by investing in real estate in a self-directed IRA.
And there are several disadvantages and complications you should carefully consider.
Make sure to understand that owning real estate in a self-directed IRA is not like owning it any other way. You and your self-directed IRA must be separate—self-dealing is not allowed.
The owner of a self-directed IRA should not benefit from the account beyond distributions, and the account itself should not benefit from the owner beyond contributions.
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