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        <title>Portland Real Estate Cafe Blog</title>
        <link>http://www.portlandrealestatecafe.com/blog/</link>
        <description>Keep up with the Portland real estate market!  Portland Real Estate Cafe blog provides valuable discussion for today's changing market.</description>
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            <guid>http://www.portlandrealestatecafe.com/blog/mortgage-rates-at-all-time-lows-should-you-buy-now.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/mortgage-rates-at-all-time-lows-should-you-buy-now.html</link>
            <author>info@portlandrealestatecafe.com (Portland Real Estate Cafe)</author>
            <title>Mortgage Rates at all time lows.  Should you buy now?</title>
            <description> <![CDATA[ 
Mortgage rates for the Portland area have dropped to 3.875% in the past few days, presenting an amazing time to buy and save money.  Rates for a 15 year fixed mortgage are at 3.25%!  


We have no idea how long this opportunity will last.  Inflation is a concern and many pundits believe rates will have to rise in the near future.  


Financing $250,000 at 3.875% gives you a monthly paymnet of $1,176 P+I.   


Financing $250,000 at 5% gives you a monthly payment of $1,342 P+I.  


That's $166 per month savings.  $1992 per year.  $59,760 in savings over the term of the loan. 


Another way to look at these great rates is what your monthly payment gets you in home value.


A house payment of $1,176 per month, essentially gets you a $250,000 loan at 3.875%.  If rates go to 5%, that $1,200 payment only gets you a $225,000 loan.  So, taking advantage of these low rates buys you a lot more home.


 


Contact us today, to find out what you can afford and take advantage of this amazing opportunity.  


503-222-7623
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            <pubDate>Sun, 14 Aug 2011 15:22:13 -0700</pubDate>
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            <guid>http://www.portlandrealestatecafe.com/blog/cool-portland-houses-april-2011.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/cool-portland-houses-april-2011.html</link>
            <author>info@portlandrealestatecafe.com (Portland Real Estate Cafe)</author>
            <title>Cool Portland Houses - April 2011</title>
            <description> <![CDATA[ 
We thought we would create a regular series about properties that our team has seen&nbsp;that we think are NICE.&nbsp; By flagging these properties as &quot;cool&quot; we are not making any judgement about the list price or the value.&nbsp; We just think they're inspired.&nbsp;Most of these &quot;cool properties&quot; are not our listings. If you see one you like, we'd love to show it to you, and represent your interests if you decide you just gotta have it.

To see the details of any of these listings, simply click the picture of the home you like.

&nbsp;&nbsp;&nbsp;&nbsp; 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;

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            <pubDate>Fri, 08 Apr 2011 11:15:05 -0700</pubDate>
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            <guid>http://www.portlandrealestatecafe.com/blog/let-sp-and-pmi-help-inform-the-timing-of-your-selling-decision.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/let-sp-and-pmi-help-inform-the-timing-of-your-selling-decision.html</link>
            <author>info@portlandrealestatecafe.com (Portland Real Estate Cafe)</author>
            <title>When is the right time to bring your home to market?</title>
            <description> <![CDATA[ 
This month's reports from S&amp;P and PMI both suggest that sellers could increase their net proceeds by bringing their home to market now instead of waiting for conditions to improve. &nbsp;Earlier this month when looking at the Portland Market Report, we observed increasing sales velocity and balanced levels of inventory in many neighborhood. &nbsp;We are advising many of our sellers to get their homes ready for market now instead of waiting until later in the Spring or early summer.

Eleven MSAs in S&amp;P's 20 city composite are reporting new lows. &nbsp;Portland is one of these eleven markets. The 20 city composite is now withing 2% of the March '09 trough. &nbsp;If the current trend continues, the housing market will enter into a &quot;double-dip recession.&quot;



In this month's PMI report, there is a special report about housing affordability. &nbsp;PMI compares housing prices and household income, and argues that over time the two should grow at similar rates, or&nbsp;homes would become increasingly affordable or unaffordable. &nbsp;From a national perspective, homes are now in balance with this historical perspective of affordability. &nbsp;There are many states, mostly land-locked states in the midwest, where homes are cheap by this measure. &nbsp;Oregon is one of ten states where homes are still &quot;expensive&quot; by this historical measure.

&nbsp;

If you are contemplating the sale of your home or investment property, give us a call and we will schedule an appointment to talk about your pricing strategy and market timing.

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            <pubDate>Thu, 07 Apr 2011 11:13:42 -0700</pubDate>
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            <guid>http://www.portlandrealestatecafe.com/blog/buying-real-estate-with-self-directed-ira.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/buying-real-estate-with-self-directed-ira.html</link>
            <author>info@portlandrealestatecafe.com (Portland Real Estate Cafe)</author>
            <title>Buying Real Estate with Self-Directed IRA</title>
            <description> <![CDATA[ 
The volatility of the stock market recently has many of us watching our retirement savings dwindle.&nbsp; Until we see some positive news, the stock market will continue to see some majors ups and downs.&nbsp; Many of us feel like we have no real control of our money that is invested in IRAs, 401Ks and other retirement savings accounts.&nbsp; Take control of your investments.

An interesting, and mostly overlooked, vehicle is the use of a Self-Directed IRA to purchase real estate.&nbsp;&nbsp; Roll over your stagnate or declining accounts over to a custodian that allows you to invest in more than the institutional stocks and mutual funds.&nbsp; Control you own future, by making investments into real property that will produce income and appreciate over time.

The current Portland real estate market is providing buyers with an amazing opportunity to buy in a down market, while interest rates are still historically low.&nbsp; With the tightening of the credit markets, getting a mortgage has become difficult turning many would-be home buyers into renters.&nbsp; Rental rates in the Portland metro area are on the rise, creating opportunities for cash flow and long term wealth building.

There are various ways to use your self-directed IRA to invest in real estate.&nbsp; Here are a few of the options:


Purchase of rental property outright, creating monthly cash flow and long term growth

Use your IRA to make the down payment, then your IRA can get a mortgage allowing for monthly cash flow

Invest in an LLC with like minded investors to increase purchasing power

Make a loan, from your IRA, to a real estate investment entity that will pay you a return of 10-15%


We are aligning ourselves with several resources to help make investing in real estate easy and profitable.&nbsp; This is a new concept to many and Im sure there will be quite a few questions.&nbsp; See this&nbsp;FAQ - Using a Self-Directed IRA to Buy Real Estate&nbsp;for an overview.

Feel free to give us a call to discuss your options and see how real estate can help you achieve your short and long term goals.
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            <pubDate>Thu, 07 Apr 2011 10:27:35 -0700</pubDate>
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            <guid>http://www.portlandrealestatecafe.com/blog/using-a-self-directed-ira-to-buy-real-estate-faq.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/using-a-self-directed-ira-to-buy-real-estate-faq.html</link>
            <author>info@portlandrealestatecafe.com (Portland Real Estate Cafe)</author>
            <title>Using a Self-Directed IRA to buy real estate FAQ</title>
            <description> <![CDATA[ 
What is a Self-Directed IRA?

A self-directed IRA is really not that different from any other IRA. The term &ldquo;self-directed&rdquo; simply indicates that you choose your IRAs investments. Most investment brokerages and banks that offer &ldquo;self-directed&rdquo; IRAs limit clients to the scope of their own investment products. Custodians without proprietary products do not need to impose the same restrictions. This means you have more choices and greater flexibility for your retirement savings plan.

What can a Self-Directed IRA invest in?

Almost anything making for virtually unlimited array of possible investment choices that are allowed.

The IRS only defines the following assets as excluded:


Life insurance contracts (e.g., a life insurance policy on the life of the IRA owner)

Collectibles (e.g., antique rugs, cars, stamps, etc.)

Capital stock in an &ldquo;S&rdquo; corp.


Examples of investments allowed within self-directed IRAs

Self-directed IRAs offer investors tremendous flexibility in choosing investments for your retirement savings plan.

Investing in real estate through your self-directed IRA may be the key to turning your dreams into reality. While most self-directed custodians accommodate traditional investments such as mutual funds and stocks, some specialized custodians also allow clients to invest in all forms of real estate (e.g., raw land; rental properties; commercial properties; even real estate-related private entities, such as limited liability companies, that invest in real estate).





INVESTING IN REAL ESTATE USING YOUR IRA:

Can I buy real estate using my IRA?

Yes, you can buy real estate with your IRA, Roth IRA, Sep/IRA, Educational Savings Account, or 401-k, 403b, 457, ESOP, and other pension plan rollover accounts. Imagine not being confined to investing your hard-earned cash in the volatile stock market or limited return CDs. You can diversify your retirement money in many creative and beneficial ways.

How do I buy real estate with my IRA?

Its actually a simple process.&Acirc;&nbsp; You either transfer your existing IRA(s) or rollover your pension plan accounts to our preferred custodian that allows Self-Directed IRAs. Then you find a property and instruct the custodian to make the deposit and the purchase. Instead of mutual funds or stocks, youll have a rental property in Portland or 5 acres in Bend as part of your IRA portfolio.

Is this new? How long have I been able to invest in real estate with my IRA?

The fact is that you have been able to buy real estate within your IRA account since the first day IRAs were created (31 years ago.). While a small percentage of Americans have already benefited from this knowledge, its not too late for you to take advantage of the opportunity.

Why havent I heard about this before?

Until recently, the use of IRAs and other retirement plans to purchase real estate was an option that was not well known. Things are changing quickly do to the current financial times.&Acirc;&nbsp; People have become disillusioned over traditional investment choices and the results of their retirement investment activities. Recent economic and business events, such as the stock market decline, market and business scandals and corruption, along with historically low interest rates, have awakened passive investors whose retirement portfolios have suffered. They are suddenly ready to take action.

Why hasnt the self-directed IRA business been publicized?

Because of their efficiency and profitability, traditional IRA providers control about 96% of the IRA industry. Their huge marketing budgets allow them to maintain a strong public presence, although recent guerrilla marketing techniques through the national media are now giving much-needed exposure to the valuable self-directed service industry. The true self-directed industry has the remaining 4% share of the IRA market and is rapidly growing.

How do I know this is all legal?

This is a question self-directed custodians hear frequently from prospects who have never heard that buying real estate with an IRA is possible. The fact is that you have been able to buy real estate with an IRA since the first day IRAs were created.&Acirc;&nbsp; Many major banks have been buying real estate in IRAs and pension plans for their clients for years.

So, now that I am convinced that it is legal to buy real estate with my IRA, what exactly can I buy?

Chances are that if you want to invest in something other than the life insurance policies, collectibles, and S Corporations, you probably can. That includes buying any form of real estate or real property. As Pat Rice, author of&nbsp;IRA Wealth: Revolutionary Ways to Build Wealth through Real Estate Investing with your IRA,&nbsp;says: &ldquo;You buy your neighbors wheel barrow and rent it back to him.&rdquo; (UBTI tax may apply).

Your IRA can purchase raw land, rental properties, commercial property, condominiums, mobile homes, boat slips, locomotives, earth-moving machines, race horses, tax liens, airplanes, tax certificates, foreign real estate, billboards, fishing rights in the State of Alaska, and even a seat on the New York Stock Exchange. Of course, all of these have to be handled strictly as investments and cannot be used personally.

How can I take funds out of my IRA to buy real estate, without paying taxes and penalties?

Thats simple. You DONT take the funds out. Buying 100 acres of raw land in Oregon is just like buying 100 shares of Intel, a standard transaction for a self-directed IRA. Buying real estate is just a purchase of a different TYPE of investment. The mechanics of execution are also quite different. Whereas the purchase of 100 shares of Intel can be performed instantaneously through the Internet, the completion of a real estate transaction takes place in many steps, over 30-60 days. The careful handling of hundreds of real estate transactions simultaneously requires the effort of a specialist.

How do I transfer my IRA Account?

First, you arrange to move your existing IRA(s) or SEP IRA(s) to a custodian, or to &ldquo;roll over&rdquo; your existing pension plan (e.g., 401-k, 403b, ESOP, or 457 plan, etc.) to an IRA.&Acirc;&nbsp; We can put you in touch with our preferred custodian .

I dont personally have that much cash. Can I co-invest with my friends and relatives?

Yes. You can combine your IRA and personal funds with your wifes or husbands savings, her or his IRA, funds from your friends, children or other relatives (or any other combination) in order to enter into the transaction together as tenants-in-common. Each investor appears on the grant deed (the legal document giving title to the property) as a percentage owner, based on the amount of each investors contribution towards the full purchase price. For example, if your IRA contributed $10,000 towards the purchase of a $100,000 parcel of land, the grant deed would specify that your IRA was a 10% owner.

If I combine with some of my friends and still dont have enough to make an all cash offer, is there a way to get a loan for the balance?

Yes. You could also combine with other parties, where one who is unrelated to you or any other IRA owner (e.g., a friend) takes out a loan to finance a portion of the transaction.

Can I collect the rents for my IRA rental property?

Again, yes, and no. You can have the renters forward the rent checks to you, BUT made payable to your IRA. They cannot be made out to you, nor can you deposit them, even if you issue your IRA the equivalent amount in a new check. Rather, simply make a notation in your register that the renters made their payments, and forward the payment on to the custodian.

Can I buy a resort rental or vacation property and rent it myself for a few weeks a year?

No. Doing so would constitute a prohibited transaction. Remember IRAs are set aside for retirement and you cannot make personal use of an IRA asset, while it is in your IRA.

What if I want to invest in a large commercial property and I do need support from other parties? Are there ways to simplify the purchase and management of the property?

Yes. Yet another popular approach is for a group of investors to combine forces and invest in an entity such as a limited liability company (e.g., LLC). The LLC can purchase the property. This may be done for a variety of reasons (which will be discussed later), but this approach will allow the LLC to take out a loan. Banks are actually more comfortable loaning to companies than IRAs and, in some cases, people. One of the reasons for this is that the bank can get personal guarantees from some of the members to support the loan for the LLC. For example, it is not a prohibited transaction for an LLC member that is unrelated to any IRA owner to guarantee the loan for the LLC, possibly for a greater percentage of equity for the assumption of the extra risk.

What are the other advantages of using an LLC to invest in real estate?

First, an LLC by definition limits the liability to the assets of the LLC. If your LLC is sued as the owner of a building, recovery is, in most cases, limited to the assets in the LLC (exceptions to this limitation may vary from state to state, so check with your local real estate lawyer; in California, for example, exceptions include if an LLC member actively participates in a tort, signs contracts in his individual name or conducts the LLC in such a way such that a creditor may pierce the company veil). Plaintiffs cant reach through the LLC to the underlying members (shareholders), including your IRA or you as the owner of the IRA. Thus, LLCs are commonly used for asset protection.

Secondly, if you have a large group of investors, LLCs simplify the purchase and management of real estate property by reducing the number of parties in the execution process. For example, an LLC with ten members can appoint a managing member, and that member can sign on real estate contracts and all other legal documents, etc. according to the terms of the LLCs operating

Can my IRA make loans to others who want to buy real estate?

Yes. In fact, your IRA may make a loan to any person, other than a disqualified person, for any purpose. Such loans involving real estate act just like mortgages and are generally referred to as &ldquo;Trust deeds&rdquo; or mortgage deeds. They are secured by the deed to the property that serves as collateral for the loan if the borrower fails to meet the loan obligations. Just like the bank, the IRA lender can foreclose on the property by following the legal proceedings associated with foreclosure.

Usually, there is a loan broker for such loans. Generally these loans are called &ldquo;hard money&rdquo; loans because they occur when the borrower fails to secure a bank loan (e.g., due to poor credit or insufficient income), and because they demand higher rates of interest (usually 8% to 15%). Many clients have experienced consistent returns of 12% on Trust deeds year after year, without ever having to foreclose. One client rolled approximately $275,000 from his pension plan to a Self-Directd IRA when he retired in 1994. He has invested in nothing but Trust deeds and earned 12% on average ever since - no mutual funds, stocks, bonds or CDs. He accumulated over $800,000 from the effect of compound tax deferred growth, and was still able to withdraw $80,000 in his first year of mandatory distributions (at age 70.5) without touching his principal (12% of $800,000 is $96,000).

Can I make a personal loan (unsecured) to a friend from my IRA so he can buy a house?

Yes. In fact, you can lend your friend money from your IRA for any purpose (e.g., to buy a boat), and it doesnt have to be secured or collateralized. Of course, such loans are risky, because you have only your friends integrity to rely on for repayment. The boat loan could be secured by the title to the boat for more protection. The tax laws require that the IRA be for your benefit, so the terms of any loan need to make the loan a good and reasonable investment for the IRA.

Are the gains or income taxable from IRA real estate investments?

This is a frequently asked question. The answer is NO - in most cases.

If an IRA buys investment real estate and then sells it at a profit, all income generated while it was held in the IRA and all the gains resulting from sale WILL be either tax-deferred (regular IRA) or possibly tax-free (Roth IRA), IF the purchases were all cash with IRA funds.

If the IRA borrows to finance the purchases, any income and capital gain that is attributable to debt-financing will be subject to taxation. So, for example, if an IRA puts 50% down on a rental property and that property generates $10,000 net income after expenses per year, the IRA will be taxed on 50% of the net income (the amount financed) less the first $1,000 which is tax exempt, or $4,000 (e.g., 50% x $10,000 = $5,000, less the $1,000 exemption = $4,000). The tax is charged at the Trust tax rate schedule because an IRA is considered a Trust for the purpose of tax. The tax applied is called Unrelated Debt Financed Income tax or UDFI tax.

Similarly, when the property is sold, the IRA will have to pay capital gains tax on any gain that was debt-financed. For example, if the same property was sold two years after purchase for a $100,000 profit, 50% (assuming there had not been any reduction in the debt) of the gain, or $50,000, would be subject to tax at a rate of 15% (the current long term capital gain rate). This results in a tax of $7,500. The remaining $92,500 would go back to the IRA tax-deferred. The IRA would also have to pay UDFI tax on any income on the property in the year of sale. Finally, if the debt had been reduced through principal payments on the loan, then the amount of UDFI and capital gains tax would be calculated based on the average indebtedness over the twelve months prior to the sale. If all the debt had been paid off one year prior to the sale, there would be no capital gains or UDFI at the time of sale.

Are you saying that if I buy income-producing or other real estate using all cash and sell it for profit, that I never pay any tax?

No. If you buy real estate, stocks, mutual funds, etc. with a traditional IRA, without incurring debt to the IRA, all the profit and income flows through to the IRA tax-DEFERRED. You can buy and sell property for twenty years or more in an IRA without paying either capital gains or income tax, provided that the investments are not debt-financed. If some or all of the investments are debt-financed you will pay UDFI tax on the amount of income and capital gains that were generated using debt. But assuming, for simplicitys sake, that you buy 100 acres in Wyoming with cash and sell it 10 years later for a $400,000 gain after the debt has been retired for at least twelve months, all of the proceeds would go back into the IRA tax deferred for the next investment.

You can continue to do this until you either voluntarily decide to take withdrawals from your IRA (penalty-free after age 59 &Acirc;&frac12;), or until you are required to at age 70 &Acirc;&frac12;. Once you begin to withdraw funds or assets from your IRA, you are taxed at current ordinary income tax rates on the fair market value of what you withdraw. If you withdraw $25,000 in cash, you have to add $25,000 to your taxable income as reported on your 1040 in the year of the withdrawal. If you withdraw 100 acres in Wyoming in one distribution (as opposed to fractionalizing the distribution over a number of years to reduce the one-time tax hit), you will have to have the property appraised and the value will be reported by the custodian as a taxable distribution on your 1099.

With the tax on any leveraged income and the requirement to pay ordinary income tax when I take money out of my IRA at retirement, it doesnt seem that buying real estate with my IRA is a good idea. Why should I consider it?

Thats a good question and one I believe that confuses many, including CPAs. First, when you buy real estate outside your IRA, you pay tax on any income. Of course, you can offset the amount of income by deducting expenses and depreciation. However, you still pay tax on the entire amount of net income. In addition, unless you meet the requirements of a 1031 tax-deferred exchange on the sale of your property, you pay capital gains tax on the total profit.

With an IRA, you only have to pay tax on any income or capital gains associated with the amount that is debt-financed, thereby sheltering the balance which goes into the IRA tax-deferred. In addition, much as with a taxable real estate investment, the UDFI calculation allows you to deduct certain expenses, including depreciation, when determining the amount of tax to be paid. See IRS form 990T at&nbsp;www.IRS.govto see the details of the calculations.

More importantly, once the tax-deferred portion of any income or gain and any after-tax income or gains from debt financing are returned to the IRA, they will grow tax-deferred (or tax-free if a Roth IRA) until you take them out of the IRA, allowing you to grow your net earnings tax-deferred for years thereafter. This is much like what can be accomplished with much greater effort and expense with the procedures for a 1031 exchange of non-IRA property investments.

In addition, you still get the benefits of using leverage to increase your returns to your IRA. There is tax on the leveraged portion, but youll usually generate more absolute after tax returns by borrowing with your IRA than if you didnt. These will result in a rapid growth in your retirement account, so youll have a bigger nest egg when you retire.

But the most important issue is comparing investing in real estate within the IRA versus outside of an IRA. Taxable and disposable funds are treated differently from retirement or tax-exempt funds when real estate investing is involved (as discussed above). But the fact is, they are separate portfolios, with different rules, and need to be treated as such. If you have an IRA or a 401-k that can be rolled to an IRA, then your decision is limited to 1) continuing to grow it tax-deferred or 2) taking it out and paying taxes and possible penalties on the amount distributed to you.

If you decide to continue to grow your IRA tax-deferred, then the issue is NOT how your IRA real estate investment compares to a non-IRA real estate investment, but rather how it relates to other IRA investments such as stocks, mutual funds, and CDs, etc. If you feel you will be most successful in terms of producing more consistent or higher returns through real estate investing, then youll choose that path to your IRA investing, or simply include some percentage of real estate in your portfolio for diversification and risk protection. They say in real estate its &ldquo;location, location, location.&rdquo; In investing, its &ldquo;diversify, diversify, diversify.&rdquo; So even if you choose to invest solely in real estate with your IRA, you would be well advised not to put all your eggs in one basket.

Why should I use a Roth IRA for real estate investing?

If you invest with your Roth IRA (and by the way, your Roth, SEP and regular IRA can all invest together in a real estate investment as co-tenants), all the income and capital gains will go back to your Roth IRA tax-deferred. Because Roth IRAs are funded with after-tax funds, if you leave the earnings (e.g., income and capital gains) in the Roth for five years from the date the Roth was first established AND until you are 59 &Acirc;&frac12;, the entire Roth, INCLUDING THE EARNINGS, WILL BE TAX-FREE FOREVER.

Better yet, you are not required to take distributions from your Roth until you die, when your beneficiaries will be the ones taking distributions. So your Roth IRA investments can continue to grow tax free for life&hellip; There is still more. As long as you are working and have earned income, you may be able continue to contribute to your Roth IRA up to $4,500 per year (there are annual adjustments to the limits) in which your adjusted gross income is below applicable limits.

Lets say you buy a piece of property for $100,000 at age 40 with your Roth IRA. When you reach retirement age (e.g., at age 65, 25 years later), your property is worth $1,000,000. You can either sell it and keep the $1,000,000 in your Roth to grow tax free, or remove the cash OR THE PROPERTY tax free.

Can I buy a business using my IRA funds?

Yes. Few people know that you can buy and operate a business with an IRA. Some people, with full-time jobs, will establish a new business just for their IRA account. Such businesses, whether they buy real estate or operate a gas station, restaurant or dry cleaner, are called operating companies when they provide goods and/or services (e.g., a dry cleaner provides a service). When your IRA owns and operates a business, it is subject to taxation just like any other business. Otherwise, the IRS says, the IRA could provide unfair competition to the dry cleaner that has to pay tax. This tax has a special name called Unrelated Business Income Tax (UBIT) &acirc;&euro;&ldquo; &ldquo;unrelated&rdquo; because an IRA is a tax-exempt entity. The UBIT rules were originally aimed at non-profits which began to create traditional businesses as a means of raising funds while avoiding taxation. The IRS, therefore, created the UBIT rules to protect private businesses from unfair competition.

Can my IRA invest in my existing business?

Yes. Lets suppose you are an owner of a company that is willing to take on additional capital. If the company is an &ldquo;operating company&rdquo; as discussed above, AND you own less than 50% (including the sum of the ownership positions of your &ldquo;disqualified persons,&rdquo; then your IRA can invest funds in the company if it is a good investment for the IRA and not made to protect your non-IRA interests. If you own 50% or more, then your IRA could NOT invest in the entity, until your ownership is diluted to less than 50% prior to the transaction by your IRA.

Can I start my own company with my IRA or 401-k rollover?

Yes. An IRA can invest alone or with the IRA owner and others, including disqualified persons, in the private stock of a new startup company. The mechanics of the execution of such a plan should be reviewed by a qualified attorney, because if the plan is executed poorly prohibited transactions can be created. For example, the IRA owner should not incorporate personally (without the IRA) when first setting up the new company.

People who have been laid off with nothing more than their 401-k savings can roll those funds to their IRA to help invest in a new venture. By using these funds, a business owner may get his company off the ground and put in equipment, inventory or product prototypes, etc., before trying to raise capital from outside investors or the venture capital marketplace. By doing so, he or she can frequently raise capital at a lower cost and with less dilution, because the company is already up and running and possibly demonstrating its abilities to produce a profit.

Can I purchase stock in a private company?

A private company is any company whose stock has not been listed and offered for sale on a public stock market, and YES, you can invest in the stock of a private company with your IRA. Doing so is no different than investing in a company that you start. In fact, most businesses are started with private investment funds instead of traditional sources, such as bank financing. Banks are not willing to take on the risk associated with investments in new businesses. They reserve their investment and loan funds for more established firms with some form of collateral. Consequently, more than three-quarters of all new businesses are started by the private funds of friends and family, including their IRAs.

How long does it take to transfer the account?

Four to six weeks to transfer from your custodian to the new self-directed IRA custodian

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            <pubDate>Thu, 07 Apr 2011 10:22:03 -0700</pubDate>
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            <guid>http://www.portlandrealestatecafe.com/blog/notes-about-the-portland-real-estate-market-trends-feb-2011.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/notes-about-the-portland-real-estate-market-trends-feb-2011.html</link>
            <author>Bob@PortlandRealEstateCafe.com (Bob Broad)</author>
            <title>Notes about the Portland Real Estate Market Trends - Feb 2011</title>
            <description> <![CDATA[ 
We just finshed reviewing the final Portland real estate sales stats for February 2011 and want to share the following highlights:

&nbsp;

North Portland. &nbsp;Very little change from January. &nbsp;This area has stabalized in a fairly balanced market. &nbsp;Inventory is flat, properties priced to sell are moving in approximately 2 months. &nbsp;Price per sq. foot stats are down $17/sf, caused by no sales over the last 90 days above $500K.

&nbsp;

Northeast Portland. &nbsp;Positive trends in pending sales which increased by 34 units, cleariong some of the aged inventory from the market. &nbsp;This indicates that the time good for sellers to bring their NE Portland homes to market, and for investors to purchase into the positive momentum.

&nbsp;

Southeast Portland. &nbsp;New Sales increased 43 units, reducing overall area inventory by 22 units. &nbsp;Over one third of the inventory priced between $300-350K and $400-450K was newly sold in February. &nbsp;The most dramatic positive shift happened between $150-200K, where the percent of pending inventory increased by 50%. &nbsp;Again aged inventory was cleared from the market, and it appears to be good a time to bring that SE Portland home to market.

&nbsp;

Portland West. &nbsp;Pending sales increased by 31 units, and overall inventory is flat. &nbsp;Sales rate of homes priced between $450-500K almost doubled, and sellers have been quick to respond leaving inventory flat in this segment. &nbsp; If you want to sell a home in the $600,000's you'll be interested to know that the sales rate doubled, and invnetory has been reduced 14%.

&nbsp;

Northwest Portland. Do you have a home that you want to sell that will sell for $400-$550K? &nbsp;30 of the 107 listings in February were pending. &nbsp;Prices increased $28/sf at the bottom of this range.

&nbsp;

Lake Oswego/West Linn. &nbsp;Inventory in this region is roughly twice that of the urban core. &nbsp;The one month increase in available inventory is misleading as pending sales increased 1.5 times the increase of inventory. &nbsp;Pending sales doubled in the $400K's, pulling some of the aged inventory from the market, meaning it's a better time to bring that home in the $400's to market.

&nbsp;

Beaverton/Aloha. &nbsp;Half the market is priced below $200,000, and roughly 1/4 of this segment is currently pending. &nbsp;Although a small segment, 43% of the homes priced between $450-500K were sold in Feb. and the pricing in this segment is up $35/sf from January. &nbsp;Now's the time to sell your higher-priced conforming-mortgage home in Beaverton.

&nbsp;

Tigard/Tualatin/Sherwood/Wilsonville. &nbsp;The pending sales rate increased from 13% of the market to 17% of the market as pending sales increased from 153 homes to 215 homes. &nbsp;In the segment priced below $200K the sales rate almost doubled (33-62), increased almost 50% between $250-300k and $350-400K, and almost doubled between $450-500K. &nbsp;Pricing, however, is off $11/sf across the area.

&nbsp;

Hillsboro/Forest Grove. &nbsp;Pending sales in February increased to 20% of active listings from 17% in January. Pending homes sales increased by 26 and inventroy went down by 28 homes. &nbsp;Pricing is generally stable. &nbsp;The increased activity was almost exclusively below $200,000, where 113 properties were under contract, up from 81 at the beginning of the month, and inventory was reduced by 30 homes.

&nbsp;

If you're thinking about becoming active inthe market in the next few months, it's time to give us a call and talk about the economics of the market, especially if you're a seller, and want to gain a better understanding of pricing and timing strategy for your home.

&nbsp;

&nbsp;
 ]]> </description>
            <pubDate>Thu, 31 Mar 2011 11:21:25 -0700</pubDate>
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            <guid>http://www.portlandrealestatecafe.com/blog/homes-for-sale-bloopers.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/homes-for-sale-bloopers.html</link>
            <author>info@portlandrealestatecafe.com (Portland Real Estate Cafe)</author>
            <title>Homes for Sale Bloopers</title>
            <description> <![CDATA[ 
For a little real estate humor, check out these recent typos and bloopers.&nbsp; Either these Realtors are typing too fast or just don't have a clue!


Cozy worm bungalow&nbsp;

Toilet leaks  be sure clients dont slirp

Professionally designed screeming room

Include Short Sale Addendumb

Kitchen with drinks bar and custom pot

Library has exposed beans, books

Bust buy in the area

For more dretails, call me to get massage

Your buyers will lick the tenants

Security with motion detector spit lights

EZ access to fleeway

Dank room for fotos remolded and espanded

House has two car garbage

 ]]> </description>
            <pubDate>Fri, 04 Mar 2011 11:26:07 -0800</pubDate>
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        <item>
            <guid>http://www.portlandrealestatecafe.com/blog/spring-maintenance-tips-for-your-home.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/spring-maintenance-tips-for-your-home.html</link>
            <author>info@portlandrealestatecafe.com (Portland Real Estate Cafe)</author>
            <title>Spring Maintenance Tips For Your Home</title>
            <description> <![CDATA[ 
As we approach spring, take note of storm and water damage to your home.&nbsp; Most houses sustain at least a few problems during the winter months. Make the repairs now, before starting on any remodeling or other major warm-weather projects. 

Check for damage to your roof

Signs include missing, curling, broken or cracked shingles. Pooling or ponds of water that fail to drain from flat roofs may indicate low areas and inadequate drainage. Moss growth can also cause damage to shingles.
Fix leaking or damaged roof flashing. 
Serious roof leaks are not caused by missing or damaged shingles, but rather by broken or improperly installed roof flashing. Repair or replace it, as needed. 

Clear gutters &amp; downspouts. 

Water damage often comes from clogged gutters and downspouts; dry weather affords the opportunity to clean them out.&nbsp; 

Check for cracked, broken or uneven driveways and sidewalks. 

Cold weather can cause cracking.&nbsp; This will help prevent guests and family members from slipping, tripping or falling. 

Check all the fascia and trim for deterioration

These areas can become weathered and worn and may lead to potential water damage. 

Repair storm doors. 

Winds can take a toll on storm doors. Often, the door closer becomes bent, breaks, or pulls away from the doorjamb. 

Repair rotted woodwork. 

Where wood sills or sashes have taken serious abuse from the weather, resulting in rot, use epoxy wood filler to repair the area. 

Service your furnace and/or air conditioner. 

With forced-air systems, air returning to the air handlers blower first passes through an air filter designed to catch dust and debris and help clean the air before its recycled back into your home. Change the filters quarterly or more frequently if they look dirty.&nbsp; 

&nbsp;

&nbsp;

&nbsp;

&nbsp;
 ]]> </description>
            <pubDate>Fri, 04 Mar 2011 11:05:30 -0800</pubDate>
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        <item>
            <guid>http://www.portlandrealestatecafe.com/blog/sorrento-ridge-traditional-must-see-backyard.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/sorrento-ridge-traditional-must-see-backyard.html</link>
            <author>info@portlandrealestatecafe.com (Portland Real Estate Cafe)</author>
            <title>Sorrento Ridge Traditional - Must See Backyard</title>
            <description> <![CDATA[ 
Deceiving beauty and value. MUST SEE BACKYARD ... sanctuary with a separate 
sport court. Every room is generous with finishing detail. Special hardwoods, 
vaulted ceilings, slate in remodeled kitchen, game room, sauna, hot tub. Great 
for entertaining and enjoying life.&nbsp; 

&nbsp;

3 Bedroom 2.5 Bath 3059 Sqft&nbsp;

Taxes $5239 per year&nbsp; 

Address:&nbsp; 14308 SW STALLION DR , Beaverton, Oregon 97008

List price $319,500.&nbsp; 

For more details and photos see Sorrento Ridge Traditional 

Don't forget to check out the Virtual Tour 

Contact us to schedule a private showing.

&nbsp;



&nbsp;

&nbsp;
 ]]> </description>
            <pubDate>Wed, 02 Mar 2011 14:05:22 -0800</pubDate>
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            <guid>http://www.portlandrealestatecafe.com/blog/portlands-build-remodel-landscape-show-free-tickets.html</guid>
            <link>http://www.portlandrealestatecafe.com/blog/portlands-build-remodel-landscape-show-free-tickets.html</link>
            <author>info@portlandrealestatecafe.com (Portland Real Estate Cafe)</author>
            <title>Portland's Build, Remodel &amp; Landscape Show - Free Tickets!</title>
            <description> <![CDATA[ 
See the latest in the areas remodeling and design trends at the Build, Remodel &amp; Landscape Show.&nbsp; Professionals will be on site to talk with the public about the latest and greatest in cabinets, countertops, flooring, windows, additions, basement finishing, and outdoor landscaping.&nbsp;

Call us or send an email for your free tickets! 

&nbsp;


   ]]> </description>
            <pubDate>Mon, 03 Jan 2011 10:46:16 -0800</pubDate>
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