Years ago, I asked a financial consultant if I could use my IRA to buy a building then have my business rent it out? He laughed and told me "No." He was right. That would be a prohibited transaction for my IRA. However, a better answer would have been. "Your IRA can buy a building and rent it out, but it can't rent it out to you or your business." I left that meeting with the understanding that my IRA could only invest in stocks, bonds, mutual funds, basically the items that my financial planner could sell. When I took my first GRI class, I learned that you could buy RE with your IRA! A couple months later, I found a lot that was fsbo. I tried to list it and told the owner what it was worth. He didn't want to use a RE agent, so he listed it in the paper as a fsbo - $14,000 less than what I had just told him it was worth. I didn't have the money to buy it outright, but my IRA did. Within 3 months, I had it sold for the value I had told him it was worth and my IRA made the gain - tax free. Using your IRA to buy and sell RE is probably the best way to invest your IRA funds, it is also one of the best ways to invest in RE. Especially when you consider that a self-employeed person can contribute up to $44,000 in one year to their IRA, reduce their taxable income and then have their IRA borrow funds to make that RE investment.
I would like to hear from other agents that are using their IRAs to buy and sell RE.