Moving On Up!

By
Real Estate Agent with Chartwell Kansas City Realty SP00229578 2007027091

Moving On Up!  - Capital Gains When Selling Your Home -

69% of people in the United States own their own home.  One question I am often asked when a homeowner is considering selling their home is the amount of taxes they will be liable for on the sale. small house

The good news is that if you have lived in the house for 2 out of the last 5 years, making it your primary residence, you can claim an exempt from capital gains taxes up to $250,000. for single filers and $500,000 for joint filers.

The really good news is that you can claim this exemption every 2 years! 

Think about this for a minute.  Suppose you sell your home for $300,000. You use $100,000 to pay off the  remaining mortgage, leaving you with $200,000. 

You can then buy another home for $450,000 using $90,000 for the down payment, 30 year conventional loan @ 5%, and pocket the remaining $110,000.  That's a nice way to move up in the world.

And in 2 years, you can do it again! moderate home

Why do people do this?  People do this to move to larger homes as they require more space.  They do this to build their wealth.  Most people do not start out in a million dollar house, most people start out in a $150,000 house. A few people stay in their original home for 30+ years.  Most people move every 6 years as their life changes.  Really smart people use the capital gains tax personal exemption to buy better homes in more expensive neighborhoods and build their wealth.

Donald Trump did not start out as a billionaire; he started out with his father's company and built an empire using real estate as the vehicle.  Most of us do not aspire to be as rich as Donald Trump but we all want more than we now have. 

Real estate has been used by most millionaires as part of their wealth building strategies. Ray Kroc, selected the locations of his McDonald's franchises so that he was collecting real estate that appreciated in value over time.  The railroad barons bought real estate with a vision well beyond that of most men of their time.  Warren Buffet is still buying real estate.  million dollar home

Your goal may not be to become rich and famous; you may just want a better life for your family.  Using the personal exemption for capital gains taxes is one way to help you get there.

When you're ready to start, call Maria for a personal consultation.

Residential Property Statistics for Zip Code 64113 Years 1997-2009
Kansas City Real Estate First Quarter Comparison Years 2008 & 2009
Jackson County Missouri Home Prices & Inventory 2002-2008
Waldo Kansas City Market Report March 2010
Morningside Market Report 2009
Johnson County KS Real Estate Market 2001-2009

Real Estate Investments in Kansas City

 Disclaimer:  Visiting this blog, or any other website, does not create an agency relationship with the author or any third party. Posts on this blog are meant to impart general information and should not be construed as professional advice specific to the reader or to any particular situation. Please consult with your own retained attorney, accountant, inspector, tax specialist, real estate consultant, or other licensed professional to receive guidance and assistance appropriate to your specific needs and interests.  All information is deemed reliable but not guaranteed.  All content, including photos, are the original creation of the author unless otherwise noted.  No part of this blog post may be reproduced without written permission from the author (with the exception of Member Reblogs, when activated). ©copyright 2010 Kansas City Real Estate With Maria on Active Rain

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Maria Morton,Realtor© Call 816.560.375Eight Mobile.     Google Maria 

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*Information obtained from Heartland MLS is deemed reliable but not guaranteed. *This is an eclectic blog combining business with a little humor; please consult a licensed  professional before making life altering decisions. ♪♫  

Maria Morton of Chartwell Kansas City Realty is a licensed Real Estate Agent in KS & MO.  816-877-8200 Office 

4141 Pennsylvania Ave Ste 105 Kansas City, MO 64111   Maria Morton Copyright © 2008-2018 

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Lottie Kendall 05/12/2010 02:17 PM
Topic:
ActiveRain Community
Location:
Missouri Jackson County Kansas City
Groups:
Active Rain Newbies
Posts to Localism
Local Expert
Consumer Education in the Real Estate World
Kansas City Real Estate Investors
Tags:
investing in real estate
building wealth with real estate

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Rainer
273,383
Irene Tron
Valparaiso, IN

Not interested in being a millionaire so I think I'll just stay where I'm at for a while longer.  I'm thinking of downsizing in the next few years rather than moving up.  I guess it just depends where you are in life and where your priorities are. 

May 12, 2010 09:48 AM #1
Rainmaker
627,517
Mary Douglas
United Country Ponderosa Realty, Red Feather Lakes, Colorado - Red Feather Lakes, CO
REALTOR, Red Feather Lakes, Colorado

Hi Maria, You're right, many people have built a great deal of wealth through their real estate investments.  In this current housing market, they not be able to see it, but traditionally investing in real estate has paid well.  I like the way you explained it here.

May 12, 2010 09:54 AM #2
Rainmaker
637,272
Maria Morton
Chartwell Kansas City Realty - Kansas City, MO
Kansas City Real Estate 816-560-3758

Thanks, Mary.  You're right about most people not being able to see it.  I know a few already wealthy people who are taking advantage of the low prices and interest rates.  My objective is to open this opportunity up to 'regular working people'.

Irene, glad to hear you're all set!

May 12, 2010 12:52 PM #3
Rainmaker
1,767,210
Lottie Kendall
Compass - San Francisco, CA
Helping make your real estate dreams a reality

Hi Maria -- you've written a very clear, easy to understand post, and I love your photos; nice way to visually show what you're talking about. I'm going to re-blog--thanks!

May 12, 2010 02:06 PM #4
Rainmaker
637,272
Maria Morton
Chartwell Kansas City Realty - Kansas City, MO
Kansas City Real Estate 816-560-3758

Lottie, I'm so glad someone noticed the photo progression!  Thanks for the re-blog!  You're welcome!

May 12, 2010 03:34 PM #5
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Rainmaker
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Maria Morton

Kansas City Real Estate 816-560-3758
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