Quote:
Originally Posted by Bugeater
How long do you typically finance them for?
|
Hogfarmer can answer this more but here's my thoughts.
Financing a house will obviously give you the tax advantage of the interest paid on the mortgage for the year. However, seeing as you'll rent this and have a new line of income, you'll have to pay taxes on this income. I'd have no idea of the tax advantage of the mortgage interest over how much income you'd generate though. Maybe Hogfarmer can answer that?
It is a different type of investment though and is fairly liquid, especially when comparing to a 401k. I would never do it because of what Hog Farmer mentioned, maintenance cost. Being unhandy like myself, I'd have to contract out all the work. If you're handy, like you are, and can do most of the maintenance, you can make way more money.
If your sole goal is to lower your taxes, having your wife max out her 401k for the year ($18,000), decreases your taxable income by that exact amount.