Income Producing Properties and the Long Beach Island Real Estate Market
Investing in the LBI real estate market can provide many opportunities. Overall, the real estate market on Long Beach Island has proven to be a stable investment platform that offers multiple options for investment and personal use. Generally speaking, the most lucrative investment on Long Beach Island will be the development of a spec home. This process involves purchasing a existing homes or lot, building a new home, and selling it for a profit. While this process offers the quickest return on investment, income producing properties also offer many advantages. Regardless of the course, is important to understand what not to miss when investing in the LBI real estate market.
What Not To Miss When Investing In The LBI Real Estate Market
Often overlooked area of investment on Long Beach Island has to do with one’s personal taxes. It is very easy to calculate the cost of a real estate purchase, the estimated cost to build, and the expenses involved in owning a home. What can be more difficult to determine is the impact this investment will have on your personal taxes. For example:
- In most cases rental income will be taxed
- Short-term capital gains can have a dramatic impact on the net proceeds when selling a spec home
- Depending on how a home is declared, the mortgage interest may or may not be tax-deductible
Many of the concerns cited above have to do with taxes. Before making any investment, real estate or otherwise, is important to speak with your accountant to understand your individual tax situation. Buying a home in the LBI real estate market can offer tremendous gross profits, however it is important to focus on the net proceeds as this will ultimately determine your return on the investment.
Investing in the LBI Real Estate Market
Even though many of the storm damaged homes on Long Beach Island have been sold, there are still many opportunities to purchase a property and redevelop for immediate equity. In addition, there are many single-family homes and duplexes that offer positive returns simply by renting during the summer season. It is important to understand all aspects of the real estate transaction, especially when is being purchased as an investment, to maximize your net profit. For more information about what not to miss when investing in the LBI real estate market or to learn about some current projects for sale on LBI, contact me and I will respond right away.
By : Nathan Colmer | The Van Dyk Group
Cell: 609-290-4293 | Office: 800-222-0131 | email@example.com