Year End Planning for Real Estate Investors

In my experience most real estate investors don’t have a plan. Having a plan is SUPER important so you know where you’re at and where you’re trying to go!

  1. Examine your tax liability – I like to look at the income that I can expect for the year and gauge what my tax liability is for the current year. Analyzing your income and expenses and overall deductions will help you understand what you can expect to pay in taxes and if you need to make any moves NOW (during the current tax year) in order to further minimize your tax liability.
  2. Next year??  – What projects do I want to complete next year? If you want to grow your portfolio, add value to your existing portfolio or liquidate. Knowing what your goals are for next year will help you prep a plan to achieve those goals. 
  3. Upcoming Vacancies – If you have leases expiring next year, you may want to start setting aside some funds for a possible future make ready. This will make the turnover painless and you’ll have the funds to get the property re-rented quickly and hopefully at a higher rate. 
  4. Maintenance – If you know you have an old HVAC, old HWH or other deferred maintenance. It may be a good idea to plan or set aside funds for any deferred maintenance that you have not completed. 
  5. Refinance – If you have a lot of equity in your property or are at a higher interest rate you may want to consider refinancing. You may be able to pull the cash out of the property and use the funds to buy another property or take care of some maintenance. 

For more end of year planning tips, feel free to contact us. We’d love to help you achieve your real estate investment goals.