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In America’s Most Expensive Cities, You Can Still Find Affordable Rent

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If you’re looking to move to one of America’s least affordable cities, you can still inch your way through finding affordable neighborhoods. This Inc piece outlines where you need to look at:

1. San Francisco

Despite San Francisco being popularly tagged as a pricey city, you can check out relatively inexpensive neighborhoods like Lower Pacific Heights, Japantown, Laurel Heights, and Fillmore District.

2. Irvine

With the city seeing a massive number of tech companies moving in, rentals have shot up. Its business district, however, gives a breather – median rents are still lower by about $1,000 when compared to the rest of the city.

3. Los Angeles

While Los Angeles continues to list some of the most expensive neighborhoods across the nation, the coastal region of San Pedro welcomes residents with median rentals that touch $2,240.

4. San Jose

San Jose continues to be a large tech hub – with its infamous rental costs. In the midst of Silicon Valley’s tech center, median rents can peak to $3,500, and buying a home can set you back by around $1 million. However, East San Jose offers a better deal. You can find median rents hovering around $3,200, which is a tad cheaper than the rest of the city.

5.  Seattle

Despite Seattle housing some of the most expensive neighborhoods, regions like Greenwood offer residents median rents that are around $2,300.

6. New York

With median rents touching $3,000 in the city, the neighborhood of Williamsbridge, the northern part of Bronx, has rents that are almost half of what the rest of the city offers.

7. Boston

Median rents in Boston are almost twice the national ones, with rents crossing $5,000 dollars. In the neighborhood of West Roxbury, however, you can find homes which offer median rents of around $2,000.

8. San Diego

One of San Diego’s oldest regions, Grantville, enjoys affordable median rents that hover around $1,600 when compared to the rest of the city at $2,695.

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Real Estate Investing

How To Invest In Real Estate With (Almost) Zero Taxes

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So you just sold one of your stock or bond investments and now you’re about to get crushed with capital gains taxes, right?

Not quite…

You see, you still have options to defer or even completely eliminate those taxes using a new loophole in the system.

Let me explain.

Opportunity Fund Investing is a newly-minted tax-advantaged method of investing in real estate that will accessible to individual investors, not just institutional capital.

What are opportunity funds?

Opportunity Funds are a new tax -advantaged investment vehicles created as part of the Tax Cuts & Jobs Act of 2017.

The concept was introduced as part of the Investing in Opportunity Act – a bipartisan bill that was included alongside the broader tax bill -but has received far less attention until now.

The goal is to help spur greater private-sector investment in targeted communities across the country called Opportunity Zones.

What are opportunity zones?

Opportunity Zones are designated census tracts selected by the state and federal governments for economic development.

Opportunity zones can be found in every state and in urban, suburban and rural areas. These are areas that have historically been passed over by investment capital, and meet certain qualifications with respect to poverty levels and/or sub-median income levels.

Qualifying census tracts must meet a minimum threshold of its population living below the poverty line, and/or a max average income of 80% area median income.

This hardly means, however, that these areas should be unappealing to investors.

Many of the opportunity zones already established are centrally-located infill neighborhoods in thriving metros that, while less affluent than their cities overall, already exhibit signs of economic vibrance and should continue to develop alongside the broader metro.

Market fundamentals already support investments in many of these census tracts. This new system of tax incentives should make such investments all the more compelling.

Why invest in opportunity funds?

Qualifying investments offer three unique and compelling tax advantages – investors can defer paying federal capital gains from recently sold investments until December 31, 2026, reduce that tax payment by up to 15%, and pay as little as zero taxes on their Opportunity Fund investment if held for 10+ years.

Opportunity Fund investing also offers the chance to have material impact on the well-being of under-resourced communities.

This presents the opportunity for individual investors to include real estate in their portfolio of “triple-bottom-line” investments – those that not only yield compelling returns, but also yield positive social impact.

Even if you’re only concerned with net returns, however, the tax advantages alone should pique your interest.

What kind of gains are eligible for tax deferral?

Investors may defer capital gains tax on any recently sold investment – including the sale of stocks, bonds or real estate – so long as those gains are rolled over into an Opportunity Fund investment within 180 days of sale.

Simply put, this new program for tax-advantaged investing is a sea-change in how investors are able to reduce capital gains tax, and carries the potential of funneling huge volumes of capital to communities across the country that need more affordable housing and more efficient access to equity for small business.

If done well and with proper oversight and guidance from the Treasury Department, this may truly create win-win-win investments across the country.

Many markets in the U.S. are suffering from an acute affordable housing shortage.

This exciting new program affords individual investors the chance to invest in the revitalization of neighborhoods across the country, while potentially earning very compelling after-tax returns.

 

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Real Estate Investing

5 Strategies To Close Your First Real Estate Deal

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