Recently, I found myself thinking about how many major life decisions somehow involve real estate. Buying your first home, selling one you’ve lived in for years, moving to another state, downsizing, purchasing a rental property, or deciding to turn your current home into a rental can all feel like real estate decisions, but they can also have tax consequences that aren’t always obvious at the time.
That’s one of the things I’ve come to appreciate through conversations with Clarence Madrilejos over the past few years. Real estate isn’t just about finding a house or putting one on the market. There are a lot of moving pieces, and sometimes the questions you ask before making a decision can be just as important as the decision itself.
From my side of the desk, I sometimes hear about the big decision after it’s already happened: “We sold the house.” “We’re moving out of state.” “We decided to rent our old home.” “We bought an investment property.” And my first thought is often, “I wish we had talked before you did that!”
Not because the decision was necessarily wrong, but because having the conversation beforehand gives us an opportunity to look at the bigger picture.
There may be tax considerations, recordkeeping you’ll need later, timing issues to think about, or questions you simply didn’t know you should be asking.
That’s also why I value having professionals like Clarence in my network. We each look at the same decision through a different lens. Clarence understands the real estate side, I understand the tax implications, and sometimes having those different perspectives before making the move can help you make a much more informed decision.
So, if a real estate change may be somewhere on your horizon, don’t wait until everything is signed to start asking questions. Sometimes the best financial planning happens before the “For Sale” sign ever goes up.
You can also learn more about Clarence and other trusted professionals in my LeTip Chapter and Extended Network.