Questions?   Email me at: darcy@huttonradway.com

Intergenerational Wealth Transfer Part 2

Hello Everyone

Last time, in our discussions on inter-generational wealth transfers, I told 3 stories of how 3 different families had handled inheriting real estate. The first family came together and formed an investment club and continued to manage their father’s existing properties as well as buying more. This built a solid portfolio and legacy for their generation and future generations in their family. The second family simply drifted apart and now see each other only rarely. The third family was fractured irreparably by the inheritance after jealousy and infighting ripped them apart. Click here to see that video again:

 http://www.huttonradway.com/intergenerational-wealth-transfer-part-1/

Given a choice, if we are going to invest in real estate as a family, I think most of us would prefer to be the first family. In today’s video I give some tips on how to do that better.

If you are willed cash and want to start investing as a familial group. Decide which strategy (ie long term rentals, development etc) might work best for your family. I wrote a book that compares these different strategies to decide which is best for you. The eBook version is available for FREE for a limited time. I recommend you take a look at that.

Here is the link for that http://www.huttonradway.com/downloads/comparing-real-estate-strategies/

Typically, I would recommend long term rentals for most families. Talk to an expert. Get educated on how this works and then go for it. The benefits are quite real.

Alternatively, if you inherit actual Real Estate, such as land or a rental asset (a house or multi-family building). You have a number of options. With raw land, if it is a location that lends itself to future development, you might want to investigate that. With rentals you can a) leave it as is and continue to rent, b) fix it and then sell at a profit, c) fix it and then keep it long term or d) condominiumize it (ie strata it), fix it up and then sell the individual condos (if that is allowed by the municipality).

In all cases, don’t just sell the asset. Take some time. Get some expert advice on what your options are.

You might want to joint venture with a developer or contractor who would actually do the work. Your input into the JV would be the property. Get an appraisal on the property as it currently sits. Once the new work is done you would get the original value of the property back first and then get a share of the profits as well (assuming you did one of the above options where the property was eventually sold).

The long term benefits to your family can be huge by investing in real estate so I would urge you to put at least some of the inheritance into Real Estate and work together as a group to build a legacy for you and future generations.