In option B, would you be able pay $100,000 cash for a $400,000 house, then immediately sell the house $400,000?
If so, then consider this: Take the $400,000, pay off your $100,000 mortgage you used to get it, use the $300,000 to buy a $1.2 mill house. (remember, after this point, you are paying cash). Sell that house for $1.2 million, then buy a $4.8 million house. Sell that for $4.8, then buy a $19 mill house and quicly resell. Your only mortgage was the first one. Everything else was bought at %25 off using the cash you got in hand from th previous sale. After agency and lawyer fees, figure on having $17 million left over. This could take a year to do.
You then take that $17 million, divide by 80 which gives you $212,500. Find 20 people to work for you (I’m assuming that I can do this). Give them $212,000 for each house. (each of the 20 is doing this 4 times, so that’s 80 repitions of the exercise) Four times they each buy a $850,000 house, sell it right away for $850,000. Then they buy a $3.4 million house for $850,000 and sell it again for 3.4. Using the 3.4, they buy a $13.6 million house and sell it for the same. This could take a year. I’m a little drunk right now so maybe I’m missing something here but my calculations come to $1,088,000,000 in sales after two years.
Coming soon to an email near you “How to turn $212,000 into a billion dollars”
I have no idea what the rules are on capital gains from ahouse. I was told that as long as you apply the gain to a more expensive house you don’t have to pay taxes on it, but then for some reason the number $250,000 sticks out.
Anyway, it was fun…