Should I Sell My 5 Rentals To Pay Cash For My New House?

[@a1lewis4]

Swear you can listen to about 5 Dave Ramsey episodes and already know what his answer is going to be.

[@Chispaluz]

Very consistent

[@jonathank18]

Galenda Wagen says the person who most likely has nothing. 🙄

[@allimarieRISING]

Yet it's still entertaining to watch 😅

[@kenaddoh4693]

“Are you a Doctor or a Lawyer”? 😂😂😂

[@jasonhunt5215]

Haha I wanna just a

[@Colyers]

How can someone with 5 rentals not figure this math out on his own?

[@WCGwkf]

He only wants to know of he should sell them to pay cash or get a mortgage. It's not the math

[@Gonnerske]

@@WCGwkf what did he think Dave would say

[@joseromero81]

@@Gonnerske Not many callers know Dave's philosophy. If they did, they wouldn't call ;)

[@carylhalfwassen8555]

His wife wants it.

[@RamTrucks590]

Dave always tells people who have rental property that they have mortgages on to sell, but he never tells them about the tax and depreciation recapture that will come due from selling.

[@Je.rone_]

*Sell rentals to pay cash for a house, where's Graham when you need him* 💪🎭

[@dannyalvarado3067]

Lol exactly

[@jeremyking3230]

Watching Millennial Money

[@Je.rone_]

@@jeremyking3230 🎭

[@matts9518]

Hes definitely eating avocado toast and drinking $5 starbucks lattes

[@nataliecat98nc]

@@matts9518 😱😱😱

[@seymourcake752]

At times.ed I feel like people call more to brag than to get real advice.

[@amolgill7480]

This fool wants to sell all his assets for a liability! 😤 Unacceptable!

[@karaayers2867]

How would a paid for personal home be a liability? It appreciates and you don't have to pay interest on it. Don't try to sell me on that opportunity cost bs about how he could invest the $ while carrying a mortgage on his personal home. That scrap is rolling the dice in retirement instead of sitting back without owing anyone a dime.

[@dexterm1285]

@@SJ1990_ A rental does the same...yeah you can make money from renting but personally ill take investing in the stock market every day over real estate. Less dealing with dumb tenants, getting text about something needing repairing or replacing, having to pay insurance, taxes.

[@alexc5369]

The only fool is one who reads rich Dad poor Dad and develops a warped idea of what assets and liabilities are.

[@johnnyb33good21]

@@dexterm1285 leveraged real estate with good debt that produces income has far superior returns vs the stock market. Rental real estate pays you multiple ways. 1.Appreciation 2. Monthly cashflow 3. Loan pay down from tenants 4. Tax benefits My 1st 4plex i bought using good debt for $211,331 and i put 25% down ($52,832.75). That building makes $1,200 every month now after mortgage, taxes, insurance, R&M, vacancy, CapEx and i self manage. It's now worth $380k and i owe $240k with over 100k in equity.I've completed 2 cash out refinances pulling 79k out tax free. If i put that same $52,000 into the stock market earning 10% returns that just doesn't cut it. 10% of 52k is $5,200 Whereas with real estate I can take that 52k and leverage that money using good debt to buy a $200,000 investment property and if that investment property goes up 10% in value I just made 20k off of the 200k investment vs just with 52k of my own money which is a 38% return. And that's not even including the return from the monthly income and the loan pay down from your tenants paying your mortgage and the tax benefits where you can defer your taxes or pay little taxes or pay no taxes

[@johnnyb33good21]

Not just any asset his income producing assets which is even more valuable. Why would anybody get rid of their income streams towards retirement where those income streams are going to be even more valuable

[@milmoose622]

This is the first time I've ever disagreed with Dave's practical application of his principles. He's not considering the likely capital gains tax hit from the rental property sales. He should be asking how long this guy has owned the rental houses. It sounds like quite a while. Sell two rentals now and do a 1031 exchange for the Jekyll island house (paying cash). Rent for two years as is, thus it's a like-kind exchange. Then fund the renovation with cash. Then sell the primary residence and move there in 3 years. Gains avoided. All cash for everything. Income preserved. Living where they want to live.

[@RamTrucks590]

And the depreciation recapture taxes. I will never sell any real estate.

[@dr.bradshaw]

Always find it funny when callers ask Dave if they should borrow money. Cmon, you KNOW what’s he’s going to say 🤣

[@aquaticasmr184]

Let's be honest this person is way beyond the baby steps leveraging debt in realestate is a pretty normal thing

[@lc9991x]

True but having a paid for personal residence at the very least is a pretty good thing to have by retirement

[@aquaticasmr184]

@@lc9991x you right having the home paid for must be a staple i missed that

[@drg3915]

Debt is common ("normal"), yes. Being sedentary, obese, and broke are also common.

[@adambouchater80]

Can't believe how stupid people can be. Never give up passive income to buy a liability. 👎

[@Bestfriend-650]

Adam Bouchater True but he isn’t buying a car, he is buying a house.

[@adambouchater80]

Personal house is a liability my friend.

[@justshady]

Just what I was thinking. He needs to go travel

[@MH-mz6if]

@@adambouchater80 Not really. Look at it this way. The property you own and live in. The person paying rent is you. Much safer then relying on a tenent.

[@adambouchater80]

@@MH-mz6if not really sir, the tenant pay you rent Wich increase your asset value, rental home is an asset, personal home take money from your pocket Wich increase you liability.

[@Jdonaleshen]

Why do people call Dave and ask if they should borrow money... you know the answer

[@scottwhite14]

They are trying to catch him and see if he will waiver, or they don't listen often or know the principles. I think a lot of people think they are above the baby steps

[@cohenfromdiscord2551]

But to be fair he doesn’t mind his callers having a mortgage. And a mortgage isn’t typical consumer debt 25% APR or a student loan.

[@Jdonaleshen]

N3RDY Hoodlums he puts up with a mortgage but recommends not to have one. This guy has several mortgages and wants to borrow more money

[@cohenfromdiscord2551]

Jennifer Shkolny but they are investments , plus he has pretty significant cash reserves.

[@paulspadafora9503]

I just choked when he said, "Honey let's go to Jekyll Island I'm gunna swing a hammer while you smell sawdust all weekend."

[@xxP1ST0LER0xx]

Keep the rentals because if the value goes up and the rental you can raise the price

[@alexc5369]

No logic.. so prices could also drop.

[@MizAlexandria]

This is where Dave and I part ways and I’m a millionaire. I can’t wrap my brain around how this makes sense. If the loan can be covered from the rental income there’s no reason to touch your money.

[@sunsoutgunsout2046]

It makes sense because you would be eliminating risk. Fine if you choose a different path but you ARE taking a risk.

[@mistergolfer7]

A very small risk, especially since he has several rentals. If he’s making all mortgage payments + insurance + maintenance etc AND is still clearing 2k+ a month he should hang on to those properties. That number will only go up with time-not to mention appreciation. I agree with most of what Dave preaches, but the math is just too good to keep the properties. The “behavior” component just can’t outweigh the math here...

[@MizAlexandria]

Mike there is no such thing as risk free investing. I’m fine with calculated risk. I’m also from a country where the average home is about250000- 300,000. So the time it will take to save up cash for each property is far too long. I’m at a place where each property pays for itself with surplus cash flow at the end of month. That works for me. I’m not negating all of Dave’s value but his real estate investment approach doesn’t align with my goals.

[@mistergolfer7]

@@MizAlexandria Amen, brother

[@teb7426]

It’s the principle of being beholden to no one, I think. Of course he sees the logic in the method you are referring to and acknowledges many people are more than capable of growing wealth in that way. But, his way leaves even less to chance and there is the sense of “financial peace” that comes with owning assets outright and of accomplishment in having worked to pay up fully. At least, this is what I’ve garnered from having binged on the vids. I don’t think you are his target-market, so I wouldn’t worry.

[@ahmadsarwar6814]

This man should talk to Graham Stephan.

[@robertspencer5219]

LOL. Maybe

[@phantomfpss]

So you are comparing basically a "kid" Who has made some millions out of youtube mostly vs a 60+ yo man who has a networth dozens of times what Graham's has and has built that fortune by actually doing real estate....

[@jayc4715]

Graham is young this man is old

[@steve_Above_and_Beyond]

In my humble opinion, the caller should sit down with his cpa/tax strategist. He obviously does not understand how he would end up selling his tax deferred asset, end up getting hit with taxes in order to pay for a house he wants to occupy. That’s literally paying tax unnecessarily at a higher rate, only to try to save interest at a lower rate. The premise of real estate investment is to arbitrage a lower interest rate, invest at a higher interest rate return to earn the delta in between. Never ask a cpa property management question, a realtor tax questions, etc, etc.

[@ripvanwinkle4532]

That guy was trying to brag on his finances but then all the debt came out. Lol

[@CerronPritchett]

Don’t sell assets to purchase a liability which is a house that brings you no income.

[@armandol1826]

Cerron Pritchett but why not? The man is retiring, let him. I get what you're saying but he's set up good.

[@stayathomemarine]

A house builds equity no matter if you are living in it or renting it out. Both are assets tho

[@EastCoastReefer]

Sarah Wagner - The house you live in is not an asset because it does not make any money. There’s no guaranty it’ll build equity.

[@penguin12902]

@@EastCoastReefer He doesn't need his house to make money, he's retiring. He's done making money. All he wants to do is enjoy life until it's over.

[@alexc5369]

If you own your house outright it is an asset as it increases in value.

[@truth.speaker]

I see no problem with buying a year or 2 in advance. In fact, it could be a smart move to plan ahead. Plenty of time to shop around and renovate

[@sarahwells2748]

I love this caller's accent...

[@chada75]

I don't care if you are in Debt, I don't care what you make, Never, and I mean never, sell Assets have make you money. EVER!

[@alexc5369]

I can think of a few reasons why you would want to sell, if you want to buy another type of asset that produces a better ROI

[@johnnyb33good21]

@@alexc5369 like playing real-life Monopoly 3 green houses one red Hotel. Harvest the equity out of your smaller properties by either selling or refinancing in order to leverage to buy Better Properties that produce more Cashflow or a better return

[@topcomment3816]

31 rental properties and they all have mortgages. I’m never selling any of them 🤑 too much money every month

[@swagmanners]

Till you’re renters lose their Jobs in the recession and can’t pay

[@topcomment3816]

Markens Chateau Right... 100% unemployment rate. 👌 You sound like one smart cookie.

[@kingofmoabs23]

Markens Chateau there will always be renters even in a recession where do you think ppl will live? Rent stays around the same regardless You’re an idiot

[@dexterm1285]

That's alot of future new roofs and new ac units...better have alot set aside.

[@topcomment3816]

Dexter M. Spent about $30k on roofs and over $10k on ACs this year 👍

[@redplanet667]

Selling assets to buy a liability ... been there done that when i was young and dumb

[@sd0753]

So he's selling recurring income producing properties so he's debt free in retirement? He only has $500k in retirement savings, selling income producing properties is pretty much equal to shooting your golden goose. The real answer should be, you're not fully retiring. You're becoming a full time landlord at least until the math says you can retire.

[@teesellz7692]

He going to buy that house real soon anyways I don't even know why he called Dave 🤭 first he said three years now its one and a half hey do wat make u happy

[@dr.aviator]

And why did he call in?

[@1123-e6n]

Its a wonder this guy can manage rental properties with this level of financial literacy/knowledge

[@COINsimp2024]

Why don't the pre-screen these people to make sure they know their numbers? Putting a guy through who has no idea what his equity is is silly.

[@AlllSmiless]

He just wanted to be on the show...

[@Sizukun1]

Yet another caller asking for affirmation on their plans. They don't want Dave's advice, they want affirmation they're smart and doing something great.

[@woolengrappler]

No

[@adfadf9785]

Danny sounds like a smart guy

[@epicgaming4946]

As soon as I read the title I just said NO! NO! NO! Don't sell 5 rental homes to buy one cash, keep all 5 rental and finance the new house and use the rental income to cover the mortgage, it's an easy question.

[@robertspencer5219]

I'm sure he's a lovely man but he doesn't really have a strategy going into retirement. He seems to be itching to be in it now. He could probably, might be better for him. I'd be trying to retire as much debt as possible before retirement and if possible get another rental, build wealth so you can really enjoy that retirement!

[@ofwolfandmanii]

If I'm at the end of my rope and I have a ton of savings for retirement I'm doing what I want. Isn't that the whole point of savings?

[@RichestYouTomSweeney]

Why give up passive rental income for a property that will be a liability. A home you live in is NOT an asset until you sell it...and as the 2008/2009 market proved, homes don’t always appreciate.

[@dexterm1285]

Name the location that hasn't gone up since 08 cause pretty sure that place doesn't exist.

[@jayc4715]

Yea but this guy sounds old..id want a nice house to live in ...instead of a bunch of slummy rentals that are only cashflowing 200bux total

[@jayc4715]

To be happy and live in a nicer bigger home..thats why

[@ChrisParrishOutdoors]

Came in expecting regressive Dave, left pleasantly with pragmatic Dave

[@REAL.OAKLAND.RAIDERS]

I fully own a triplex should I sell or rent out

[@khoidang5552]

wow this only 8 month ago, Dave was right

[@betterhomesnc2437]

Selling assets to buy a liability... the fact that he is asking tells me he should get rid of them.

[@dexterm1285]

Well given this guy is older and close to retirement he needs to not have a mortgage and be debt free when retirement comes. His rentals will likely not be paid off by time he dies so he won't be making big money from them. If he can keep his retirement expenses low he can live well on around 40 to 50k a year.

[@NoDebtButLove]

Danny knows what he wants... he's paid the cost to be the boss.

[@NotShowingOff]

It’s an island. The other question is do you really want to be a landlord in retirement.

[@cohenfromdiscord2551]

Arvind Talukdar a property manager my guy

[@daprinceomar]

Ill buy your rentals!

[@connorhuested]

Real Boomer problems

[@chartuck]

Dave the kind of guy to ask the cashier at dollar general what their household income is.

[@chartuck]

@C B Reduce that time frame to a month if she picks up a second job delivering pizza.

[@alexc5369]

Why would he do that? The cashier is not the one calling him up asking for his advice

[@nationalnotes]

Good old Jekyll Island where the Federal Reserve was born

[@Creech786]

Alexander Exactly!!

[@mrjv750li]

Cleveland Brown wants to buy!

[@elijahsplaytime2540]

5 rental properties and he only clear $2200 per month?? Where he renting out ?? The hood of Baltimore??

[@financeroyce474]

2200 profit. Not total before expenses

[@krissynow2024]

3 years nooooo

[@EmpireTextbooks]

This guy needs to call into the Graham Stephan Show to get some real advice. He shouldn’t be aiming to get out of debt but to maximize cash flow

[@flash12319]

I feel sorry for the people that actually live by this advice....why would you sell your rentals🤦🏾‍♂️

[@edb484]

I feel you bro lol

[@dannyalvarado3067]

Yea i agree. Well maybe sell one to use as downpayment but not 3 or more

[@jimroscovius]

You are all forgetting about risk.

[@michaelb.8953]

@@jimroscovius All investments have a certain level of risk even that $80,000 that he has sitting in his checking account guaranteed to lose money everyday due to inflation and losing opportunity costs just sitting there doing absolutely nothing for him except for keeping the bank happy.

[@chada75]

@@jimroscovius You what else is risky? Working a job. Anybody can go to work Tomorrow and be fired. Then, it make take a long time to find another job and even if one has money saved, they made run out before finding something else. But no one brings that up on here, do they?

[@Bison162]

Let the man speak before you interrupt him, Dave.

[@nehemiahstewart]

My thoughts exactly but I guess that's why he named it the Angry Ramsey Show...wait

[@nehemiahstewart]

Yall a man deserves to retire where he wants to live. He'll be debt free with passive income still coming in. He'll be fine.

[@JuanVargas-ek3yg]

🤦🏼‍♂️

[@hlhl2691]

I love Dave but his condescending attitude in the beginning of the call was unprofessional to say the least...

[@ransom182]

The caller is addicted to DEBT.

[@DTA707]

Selling a rental property 😂😂😂😂😂

[@Boristien405]

What's wrong with that? Sometimes people needed to do that for cash plus it's one less thing mentally you have to worry about

[@DTA707]

@@Boristien405 what's wrong with selling something that will make you more in the long run and you can hire a property manager and make it completely passive? Also why not pass down generational wealth? This guy also doesn't have a need for the cash now. He's just being impatient

[@DTA707]

@@Boristien405 but yes some people do have the need for the cash. That is not this guy

[@06XTOR]

Gee Dave the guy just wants to buy his retirement house. OK......

[@Summer_haiku]

SMH Boomer -_____-

[@jackspedicey1382]

Ok boomer

[@josefinamaliwat846]

Firstttttttt

[@LifeSoDevine]

Seconddddddd