October 9, 2025 • 36 mins
The largest wealth transfer in U.S. history is underway, with trillions of dollars in property expected to shift from one generation to the next.
In this episode of The Jon Sanchez Show, Jon, Cory Edge (Edge Realty) and Dwight Millard (Highlands Mortgage) explore what really happens when you inherit a home—and the critical financial, tax, and emotional decisions that follow.
They outline the key factors to consider before deciding whether to sell, keep, or rent an inherited property, including how each choice may affect your overall financial plan.
The conversation also highlights estate considerations, potential market impacts, and how inheritance fits into long-term wealth management in Reno and beyond.
👉 Watch this episode on YouTube: www.youtube.com/@thejonsanchezshow
👉 To learn more about retirement planning and wealth management in Reno, visit: sanchezgaunt.com
Compliance Disclosure: This program is for informational purposes only and should not be considered investment, tax, or legal advice. The views expressed are those of the participants and may not reflect the views of Sanchez Gaunt Capital Management. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. Always consult with a qualified financial professional regarding your individual situation before making financial decisions.
In this episode of The Jon Sanchez Show, Jon, Cory Edge (Edge Realty) and Dwight Millard (Highlands Mortgage) explore what really happens when you inherit a home—and the critical financial, tax, and emotional decisions that follow.
They outline the key factors to consider before deciding whether to sell, keep, or rent an inherited property, including how each choice may affect your overall financial plan.
The conversation also highlights estate considerations, potential market impacts, and how inheritance fits into long-term wealth management in Reno and beyond.
👉 Watch this episode on YouTube: www.youtube.com/@thejonsanchezshow
👉 To learn more about retirement planning and wealth management in Reno, visit: sanchezgaunt.com
Compliance Disclosure: This program is for informational purposes only and should not be considered investment, tax, or legal advice. The views expressed are those of the participants and may not reflect the views of Sanchez Gaunt Capital Management. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future results. Always consult with a qualified financial professional regarding your individual situation before making financial decisions.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:08):
Good Thursday afternoon to you. Welcome to the John Sanchez
Show on News Talk seven eighty K Whitch. It's a
pleasure to be with you and a pleasure to be
with my co host around the horn.
Speaker 2 (00:15):
We shall go.
Speaker 1 (00:16):
I'm not seeing much of a smile on his face
this afternoon, but let's see.
Speaker 2 (00:20):
We can get there. It is there is Dwight Millard Heighlands. Okay, buddy, Okay.
Speaker 3 (00:24):
I'm doing fine.
Speaker 2 (00:25):
Okay. I just want to make sure.
Speaker 1 (00:26):
I mean, nothing's happening in bomb in mortgage rates due
to the bomb market. Nothing happening, so all right, I
just want to make sure. It's like, did you know something.
Speaker 2 (00:34):
I don't know?
Speaker 4 (00:35):
No, no, just a little quiet, little quiet. But I
mean they're blaming it now on just the government shutdown.
There's another yawn or no, no, no data, no anything.
So right exactly, I guess, but we all, I guess
we all should just take off right.
Speaker 2 (00:48):
Right right, Yeah, that's true, that's true. Corey individuality.
Speaker 3 (00:53):
How are you, my friend, I'm doing fantastic.
Speaker 2 (00:55):
Good good mister Louk. I love it. I love it.
Speaker 1 (00:58):
Always smile it all right, flks, Well, thanks so much
for joining us. We're going to recap today's stock market activity,
a bit of a rough one on the Dow side
of things, kind of okay on the Nasdaq in the
SMB after record setting day after day, but we didn't
get that today. Giving an update of course of everything
that happened, and then we're going to get into our
real estate topic. We're going to continue what we started
on Tuesday because we as always ran out of time,
(01:20):
and our topic on Tuesday was you just inherited a house?
Speaker 2 (01:24):
Now?
Speaker 5 (01:24):
What?
Speaker 2 (01:25):
Right?
Speaker 1 (01:26):
Again, this is all centered around what we've been discussing
quite frequently on this program, which is the biggest wealth
transfer in history by many economists, is going to occur
starting next year. Through they've been about whose numbers you
look at at least for the next ten fifteen years,
right the Dwight Night's generation, the baby boomers passing wealth
(01:49):
on to our kids and so on and so forth,
and again it's going to be one of the largest
ever in history, trillions of dollars. Of this trillions of
dollars is going to be in the real estate side.
What was the numbers, guys, like fourteen trillion, right, something
like that. If you touch on Tuesday, that is just
going to be the real estate. So the odds are
many of you are going to be inheriting real estate
(02:11):
from your parents most likely. But before you think you
just hit the lottery and get all excited, we want
you to step back a little bit and if it
hasn't happened, this is a great time to learn about
what this entire process is about. What should you really
do if you inherit the home? Should you keep it?
Should you sell it? Should you rent it?
Speaker 2 (02:28):
Right?
Speaker 1 (02:28):
Those are your three primary options. Well, today we're going
to continue our discussion. Like I said that, we started
on Tuesday on the financial, the tax, and the emotional decision,
because unlike any other form of real estate, this does
have an emotional piece to the puzzle. So we're going
to talk about that. Last Tuesday we got through you know,
you start with reality number one. Number two point we
(02:50):
touched on was the immediate steps after inheriting the home,
and then we left off on point three, which is
understanding the stepped up basis. So we're going to recap
real quickly what we touched on on point one too
and then getting into our fresh topics. But again, the
odds are based upon the Great wealth transfer that many
are predicting that again, at some point you're probably going
to be one of these people inheriting money, or if
(03:11):
you're on the parents side, you're going to be moving
this real estate over to your children, grandchildren, etc. So
it's gonna be a great learning listen for everybody. We're
excited to share it with you. But in the meantime,
let's get down to the stock market side of things.
So if you notice, we've been firing some shots across
the bow, as the saying goes, watch this market. Things
are a little frothy in many investors' minds and many
(03:31):
strategy many traders' minds. It just takes a little bit
of this, a little bit of that, and we can
start to succumb to some selling pressure pretty quickly. Well
today we did that at least on the Dow side
of things. We're recovered on the Nasdaq and the S ANDP.
But this market is becoming very fragile right now. President
came out today again. We're in what today is what
the ninth day of the government shut down. As I
(03:52):
shared this morning on my stock Updates, I feel this
is my personal opinion. I'm feeling that investors are starting
to get a little bit of a little bit of anxiety. Right,
nine days, they're not seeing any economic data, as you'll
find out when Deight gives us the mortgage side of things.
People are just kind of getting a little bit of Okay,
how long is this thing really going to go on?
Speaker 2 (04:12):
That I was just sharing with the boys before we started.
I got a news headline.
Speaker 1 (04:16):
It came out at two fifty five from the Bureau
of Labor Statistics. They have recalled their staff too ready
this September CPI report by months in. That's according to Bloomberg,
So you know that's okay, So they're going to get
the staff in there and get the CPI report ready
for the end of the month. So, I mean, here
we are, the ninth of October. Is this just a
(04:37):
preemptive move? Do they know something we don't know as
far as the government shut down coming to and who knows?
Speaker 2 (04:42):
Right?
Speaker 1 (04:42):
So, but I thought that was very interesting to see
that headline. But back to the nervousness of the market.
So we're again nine days. Remember our last one was
thirty three days that the government was shut down, So
we've got a ways to go. We're going to match
and beat that one. So we're nine days into it,
we're not getting any economic reports. Market is kind of
looking for some information right now, looking for some direction. Again,
(05:04):
the concerns keep coming up about AI and valuations and
circular accounting, all the things that I keep talking about
every single day. This is what we're talking about today.
Kind of felt that way that it's like, Okay, people
starting to get a bit nervous on things.
Speaker 2 (05:15):
But again that's just today.
Speaker 1 (05:17):
We'll see if there's no trend developing by any means,
Just again, be cautious, have a defensive strategy in place,
be ready to go if again, you know, we get
into these situations, you know where the market can move.
Speaker 2 (05:29):
South on you very quickly.
Speaker 1 (05:31):
You know.
Speaker 2 (05:31):
It's funny, guys.
Speaker 1 (05:31):
It was about nine o'clock last night and I was
getting ready to go to bed, and I was looking
at my phone set in my alarm, and I looked
at the just one look at me, you know, last
minute news stories, and I had deja vu. There was
a picture of a twenty three year old kid that
used to he got started. He graduated to Colombia at
nineteen years old, went to work for Elon Musk I
(05:52):
think at Tesla or at X and now he's launched
his own AI company and you can still see the
pipples on his face, but he's now a billion And
I took I took a screenshot of that. I sent
it to Jason and I said, if this isn't reminiscent
of the dot com era, when remember that, guys? I mean,
they can these kids that some of them weren't even twenty
(06:13):
one years I remember joking about that on the radio show.
There were something that weren't even twenty one years old,
not old enough to drink, and they're like instant millionaires overnight,
hundreds of millions of dollars. And now you start seeing
some of that going on with this new boom of
the AI side of things. And yeah, I just thought
it was kind of a kind of interesting to see
that happened.
Speaker 2 (06:29):
That a lot of a lot of similarities going on there.
Speaker 3 (06:33):
As I say, John, go back to that era.
Speaker 4 (06:37):
These kids did they get in before the IPOs?
Speaker 3 (06:40):
Did they? I mean were there? You know, hey, you
know give you that.
Speaker 2 (06:43):
That's a great question.
Speaker 4 (06:44):
And what what gave them? Remember all of a sudden.
Speaker 2 (06:46):
It just yeah and wealth.
Speaker 1 (06:48):
I just I reflected it what happened with Jason yesterday
on the show. Because I was, you know, obviously in
the thick of things at that point. So I was
living in Bakersfield. I started on the radio station. You know,
I still had the brokerage form. I just went independent
at ninety nine and started on the radio station there
in ninety seven, and then then they gave me my
own show at about I think nineteen ninety eight, and
(07:09):
then stock updates very similar to what I do now.
But in ninety nine they moved into primetime. I was
at five o'clock, and so I had a massive, huge audience, right,
and I remember telling the audience that, you know, watch
what's going on in this whole dot com era? Right,
because once again to relive that, Dwight, it was all
you had to do, all literally all you had to
(07:30):
do is put dot com at the end of your
corporate name. And people immediately thought, oh, this is Internet related,
let's buy their stock. I mean, as stupid as that
sounds in retrospect, that was it. So what did I do.
I formed a corporate California corporation called Stocktalkamerica dot Com
and I was the only shareholder of it, and I
issued myself. I can't remember the exact number, but it
(07:52):
was some crazy number like I don't know, one hundred
thousand shares, you.
Speaker 2 (07:55):
Know, worth point zero zero one cent, right, But I
had it. I had it, you know, in my office
and stuff, and I still have that. And what did
I do?
Speaker 1 (08:04):
I call it stock Talk America dot com right just
on the whatever hopes.
Speaker 2 (08:08):
That's how crazy things were that I had dot common
in my name.
Speaker 1 (08:11):
Maybe someone who want to come to buy the you know,
the rights to my radio show or something.
Speaker 2 (08:14):
You know.
Speaker 1 (08:15):
But that's what it was to Wight. It is you
put dot com, people would jump on it. And then
so these guys would start these companies with nothing, no earnings.
Matter of fact, they were you think, you know, some
of the burn cash rates are high right now with
AI companies. It ain't nothing, you know, compared to what
we saw back in the dot com era. So start
these companies with nothing, you know, start in the in
the basement, whatever they did, put dot com on it.
(08:36):
Next thing you know, they're losing hundreds of millions of dollars.
And next thing you know, they're going on the on
the stock market. And then investors, oh my god, it's
dot com. It's an IPO grab it, and then the
stock runs up. These kids overnight are becoming again, you know,
multi multi millionaires. And then what happens reality sets in,
you know, sometimes a month later, a couple months later,
(08:57):
they're like, hey, we're out of cash. Can we do
a second marry stock offering? And of course at that
point the dot com bubble began to burst when everyone
was like no, yeah, dot call in your name, We're
not touching you.
Speaker 2 (09:06):
And then booth they just disappear, go bankrupt.
Speaker 3 (09:09):
And how many of them cashed out?
Speaker 2 (09:11):
That's right, that's right, very few, yep o.
Speaker 3 (09:15):
Well, I mean a lot of them, a.
Speaker 1 (09:16):
Lot of them did they They made the money in
the I p O Corey and then and then the
shareholders got screwed as always yeah yeah yeah, but but
to your I think what you're referring to, you know,
shareholder wise, how many got out?
Speaker 2 (09:28):
Yeah, not many, not.
Speaker 6 (09:29):
Many, well, the shareholders and then depending on the lock
up periods and whatnot. But yeah, there were there were
a lot of people just like today that believe their
own hype, you know what I mean.
Speaker 3 (09:39):
And so it's very interesting.
Speaker 2 (09:42):
Yeah, yeah, yeah, exactly.
Speaker 1 (09:44):
It was a it was fun to reflect back, and
I hadn't thought about those days, you know, like I said,
until yesterday.
Speaker 2 (09:48):
So that's funny you bring that.
Speaker 4 (09:49):
Up and there's still a few out there, you know.
Speaker 1 (09:51):
Yeah, well you know I saw a stat today because
well i'll dig get up at the break.
Speaker 2 (09:56):
Yeah, well I'll bring it up.
Speaker 1 (09:59):
But base it's saying a massive percent of the market
is going up because of a very small percentage of
the AI dominated countries or companies, right, and and you
know you start looking at that and you go, once again,
we're starting to get top heavy.
Speaker 2 (10:15):
Right, We've heard the term magnificent seven.
Speaker 1 (10:16):
Right, Remember the last couple of years you've had the majority,
the majority of the market gains were attributed to essentially
seven companies, the Google, so on and so forth. But
to my point in this article, it talks about back
to that era, Cisco, right, very prominent, you know, market
leader right now, they were down to like two bucks
in that dot com bubble burst and you know they
they were one of the survivors. So once again the
old analogy comes back to it's he who has the
(10:40):
strong or the biggest ballot.
Speaker 2 (10:42):
They are the ones that survived.
Speaker 1 (10:43):
And it's going to be the same way I'm telling
you it's going to be the exact same way with
this AI situation because there's so much fraud right now
they're buying. There's so much money, much more money, much
more capital involved in the AI ecosystem, right, because what
was different than the dot com? Well, do I launch
the dot com in your bedroom and you know you
don't have any bricks and mortars or anything.
Speaker 2 (11:03):
It's not the case here, right.
Speaker 1 (11:04):
You're Jensen Wong, the CEO of in the video, was
on CMDC yesterday. He goes look at just to get
a one gigawat data center up and running, you're talking
eight to ten billion dollars. And now they're bringing on
these you know again, ten gigawatt data centers, right, massive
massive ones that are there. You've got serious capital involved,
(11:24):
and you know Corey List following the capital trail as
much as I do. You know, where's the capital coming from?
Venture capital funds? You know, basically private equity money, et cetera. Right,
So they lend it to x y Z company to
build it. There's another party, the actual construction company and
the builder of it. And then you go down the
food chain and guess what you take a let's say
(11:45):
an open AI or one of these other companies.
Speaker 2 (11:47):
Do you think that they Corey, You're you're the real
estate guru.
Speaker 1 (11:50):
Did open Ai if they're building one of these massive
data centers, just to pick on them, are they are
they buying that real estate those those data centers.
Speaker 3 (11:58):
Oh, probably least, and I would assume exactly, yeah.
Speaker 2 (12:01):
Of course, why they're not burning up capital doing that.
Speaker 1 (12:05):
But most importantly, if things fizzle, which they will, and
some of these data centers and these companies are gonna fail,
you're gonna see a lot of empty data centers in
my opinion, down the road, what do they do.
Speaker 2 (12:14):
They go bankrupt? Do they write it off? Right?
Speaker 1 (12:16):
It's not like they have to sit there and sell
the real estate and they didn't have to cross collateralize
every asset they have, which none of them have any assets.
Speaker 2 (12:22):
They can get out and qualify for a mortgage right way.
Speaker 1 (12:25):
So yeah, So it's it's that chain where it starts
with the private equity, the venture capital who you know
really funding the money. Are very high interest rates. I mean,
I'm shocked to see some of these interest rates. And
then they lend it, you know for the construction side,
and then you get somebody else that'll come in, some
of the real estate investment trusts, etc.
Speaker 2 (12:40):
That'll come in.
Speaker 1 (12:41):
They'll actually buy, you know, foot the bill for the
entire construction. They'll cash everybody out. Now they now it's
on their balance sheet, and then their hope is they
turn around and lease it to you know, the Open
Ayes of the world or some of these other companies.
And even even the chips to Wight. Even the chips
in these data centers, most of them are leased from videot.
They don't even own the chips. So what skin in
(13:03):
the game do they have. Did you look to see
the amount of money that open Ai is borrowing. I mean,
it's nothing for them to go out and go, oh yeah,
we're doing a dead offering for five hundred billion, half
a trillion dollars. Investors aren't blinking and eye It's like,
oh my god, this thing is just going to be
the most phenomenal.
Speaker 6 (13:17):
I hope it is, isn't it?
Speaker 1 (13:19):
And I kind of goes which I pause, you my god,
So behind pause one second here, let's turn it over
to the wonderful Christen Snow right now Trottic Center.
Speaker 2 (13:27):
Sorry Kristin, Welcome back.
Speaker 1 (13:39):
To the John Sanchez Show on News Talk seven eighty KO,
which the Corey edge of edge reality to White Mollard
of a centers you want, Lindy per centers you want?
Whoa where'd that come from? How about Highlands mortgage? Yeah,
my goodness, lashing to the bath question of the bath?
All right, two forty three loss on the days how
we finish up? There is a half a percent point
five to two to be exact, with the close of
forty six three sixty eight as I lost nineteen and
the SMP on nineteen.
Speaker 2 (14:00):
Also Oil Doug fifteen give up sixty one to forty two.
Speaker 1 (14:04):
A barrel that run on gold broke a by that
four thousand mark yesterday or the last couple days. It
came back to below the four thousand mark today three
thousand and nine seventy six to fifteen ounce down ninety
three dollars to ninety cents an ounce, and mister Mallard
to two basis point increase on the ten year four
to fifteen is our yield.
Speaker 2 (14:21):
Educatus on the mortgage side.
Speaker 4 (14:22):
Fight here we go, Yon Yon Yon, no report, so
you know, no bond trading. So the thirty year mortgage
is exactly what it was on Tuesday six point three eight.
You got a couple basis points improvement on the fifteen
year to five eight eight, and then the Fahava.
Speaker 3 (14:38):
Is at six point zero five and six point zero.
Speaker 4 (14:40):
Seven, so a little bit of improvement on those those fronts,
but the thirty year fix just hold steady.
Speaker 1 (14:47):
Nothing, yep, exactly nothing, all right. A little bit of
local real estate news, thank you to Wright. A little
bit of local real estate news reported this morning in
the Reno Gazette that City of Reno has approved ad us.
Speaker 2 (14:59):
Mister Edge, tell us about that good.
Speaker 6 (15:01):
Access you know, it depends on depends on who you're
talking to, but accessory dwelling units. This has been going
on for I don't know how long, So last night
was the final vote.
Speaker 3 (15:10):
I suppose, uh so.
Speaker 6 (15:12):
Accessory dwelling un it's I didn't read it John as
far as the in depth statutes, but basically, if you
have a house and you have enough size and you
have enough parking.
Speaker 2 (15:20):
Now you can build a square foot minimum.
Speaker 6 (15:23):
Is that what it was yet and they usually have
a parking component in there, so now you can build
a separate structure on your property for your mother in
law or they're going to allow rentals, and they're going
to allow short term rentals, and I think, if I
understood it correctly, kind of unfettered use of short term rentals.
So they are talking about going in and getting a
(15:45):
handle on that, because it always scares me when they
talk about, oh, we're going to allow these ADUs and
then they compare it to people that want to come
in town like they do for a hotel room. Like
people buy their house and neighborhoods, so they're not staying
in a hotel room. So now you're gonna let my
neighbor built something. But you know, don't get me started
on it. I'm not a huge fan of it. My
cynical side is if you build more houses, more people
(16:06):
will move here, and that's not what I'm looking for.
But anyway, we'll see.
Speaker 1 (16:11):
But isn't this just the opposite, though, Corey, because we've
we've done a lot of shows on adu's. Remember a
few years ago down in the Bay Area they allowed
these and it was.
Speaker 2 (16:18):
Like, oh my gosh, finally you know I got I
can do this.
Speaker 1 (16:22):
Isn't it more so validating that the reason they are
allowing this is because that it is too expensive to
to there's a how to start at the beginning.
Speaker 2 (16:34):
There's a housing shortage.
Speaker 1 (16:35):
So Dwight can build an ADU in his backyard for whatever,
one hundred thousand dollars, he can turn around and rent
it out to Corey Edge, who you know, is a
single guy, doesn't have any family, blah blah blah blah.
Speaker 2 (16:45):
And that's gonna.
Speaker 1 (16:46):
Ease some of the pressure on the housing, Isn't that
kind of the underlying gist of it.
Speaker 6 (16:51):
That's the underlying gist. My again, my cynical opinion is
we don't have a housing problem. We have a people problem. Okay,
there's too many people.
Speaker 3 (16:58):
That's just me thousand problem.
Speaker 6 (17:02):
Yeah, yeah, we don't have a housing issue. But there's
some of the things to remember. There's certain neighborhoods you
can't do it. And if you have CCNRS restrictions, I
don't care how old they are, I live in a
neighborhood with restrictions from nineteen forty eight.
Speaker 3 (17:15):
You're not going to be allowed to build them.
Speaker 2 (17:16):
There.
Speaker 6 (17:17):
The state and the legislature and even the local government
cannot override existing property restrictions, so they'll be lawsuits over it.
But it's not going to fit every single neighborhood.
Speaker 3 (17:29):
Let's put it that way.
Speaker 1 (17:31):
So your advice to someone that says, Okay, I fit
the criteria. I've got five thousand square feet plus i
don't have an hlay, but man, I'd love to build
something and get a thousand dollars a month rent.
Speaker 2 (17:41):
What's your advice to someone like that?
Speaker 3 (17:43):
Run the number.
Speaker 6 (17:44):
So the first thing is if you hit all the criteria,
meet with the contract of what's it going to cost
to build this? So if you think you can rent
it for let's call the hypothetical thousand dollars a month,
but it's going to cost you seven or fifty thousand
dollars to build, that doesn't make much sense. So you
still have to run the numbers that way. You can also,
I guess, kind of look at how it would potentially
(18:05):
increase your property value. But as Richard Lace would let
it and property taxes and all this stuff, Richard Lace
would let us know that if you think it's going
to increase your property values by x, he is an
appraiser would have to go out and find other similar properties.
Speaker 3 (18:19):
That have ADUs.
Speaker 6 (18:20):
You don't just get to, you know, spend five hundred
thousand dollars and then add five hundred thousand dollars to
your value.
Speaker 4 (18:26):
And I need to make a very important point, and
Corey jump in on this. Remember in the state of Nevada,
it's cost minus appreciations. How they come to your tax bill. Okay, John,
So the older the house, the lower the tax bill.
In theory, the moment you go get a permit to
add on to your house, Boom, you're back on there
in your tax right, Corey, Your tax base has just
(18:49):
changed from that point. So the moment you go pull
a permit, you just wiped out.
Speaker 2 (18:55):
Your son for the numbers real quick.
Speaker 1 (18:58):
So let's say I bought a house ten years ago
and it was five hundred thousand, So that's my cost basis. Okay,
you said cost minus appreciation, so property tax value. Let's
say it's three hundred thousand, right, that's the value and
paying my property tax on You're saying, if I go
high contractor and build an ADU and let's say it's
worth one hundred thousand, my cost basis now is the
five plus the one hundred something.
Speaker 3 (19:18):
The moment you pull up permit.
Speaker 4 (19:20):
The moment you pull up permit, Corey, correct me if
I'm wrong, but the moment, so let me give you.
Let me give you an example. In the old Southwest Reno,
you could buy a million and a half dollar house
and the property taxes, John, are are one hundred and
twenty five a month.
Speaker 2 (19:34):
I've done one one hundred and twenty five dollars a month.
Speaker 4 (19:37):
The moment you go pull up permit to do an
interior reconstruction or add on, you're no longer at the
one twenty five, they're.
Speaker 6 (19:45):
Gonna want what they do. Did not but what they do.
And in your example, John, it's not your cost basis.
So like what I mentioned, you can spend a million dollars,
but if the house was built nineteen twenty, it's depreciated
back to nineteen twenty. If your neighbor, if your neighbor
spends a million dollars on a brand new house, his taxes,
his or her taxes will be ten times higher than yours,
(20:07):
even though.
Speaker 3 (20:07):
You spent the same amount of money.
Speaker 1 (20:09):
So it's the age of original Yes cost when you
actually when it was actually built, could have been.
Speaker 6 (20:14):
Yes to appreciate it back, so they appreciate it back
to the time it was built. In Dwight's example, they
don't automatically take you to the brand new thing.
Speaker 3 (20:23):
They do a blended.
Speaker 6 (20:24):
So if you look at the assessor stuff, sometimes they'll
say like built in twenty nine, but I can't remember
the word they use, but like blended built in nineteen
seventy two because somebody did an upgrade halfway. So they
don't take you to the full boat. But you don't
you lose the benefit of.
Speaker 4 (20:39):
The long one, so you will get a bump in
your taxes. So you got to cure that in too,
A good point.
Speaker 3 (20:45):
And the other thing too well, ok ahead, before we
get off it.
Speaker 6 (20:48):
If you're going to build one of these things to
do short term rentals, they are actively talking about and
they will come in and put regulations on them. So
don't bet the family farm on making rental income because
of change in a year.
Speaker 2 (21:01):
Okay, yeah, oh no, that was crazy. Just work cool? Good?
Could you lend on that? Can I we're getting to
that point now.
Speaker 4 (21:09):
Yeah, but right now I think typically what you do
is probably go get an equity line because you're locked
into Go get a nice equity line to cover the
construction or whatever you can do there versus mess up.
Speaker 2 (21:18):
First all right.
Speaker 1 (21:19):
I saw it as a big breakthrough, but like anything,
there's pluses and minus thanks guys related laying out the
negative side of it, And I don't mean that in
a bad sense. It's like, man, glad to know that
now versus yeah, someone getting excited and going out, like
you said, betting the family farm on it, no pun intended.
Speaker 2 (21:34):
All right, we come back. You just inherited a house,
now what.
Speaker 1 (21:36):
We'll get to our topic, but first it's turn it
to Jack Saban, who has news trafficking weather. Hello Jack,
welcome back to the John Sanchez Show on Newstock seven
eighty k, which with Corey Aage of Edge related a
white and Larti Highlands mortgage two forty three loss on
(21:58):
the Dow down nineteen on the NASDAK and on the
S and P five hundred. All right, let's get to
our topic that we started on Tuesday but ran out
of time. All right, great wealth transfer. Let's give you
some stats to get this kicked off and refresh your memory.
According to Sorelli and Associates, eighty four trillion dollars in
assets are expected to be passed down through estates between
the year of twenty twenty four and the year of
(22:19):
twenty forty five.
Speaker 2 (22:20):
Of that sixteen trillion, there's that number, guys.
Speaker 1 (22:23):
Sixteen trillion dollars is going to transfer within the next decade,
and about half of the wealth is going to be
tied to real estate, particularly in California, Florida, Texas and
high other high appreciation states. Forty five percent of Americans
eight to fifty five plus own their home outright, almost
a half, meaning millions of properties.
Speaker 2 (22:40):
Are going to soon change hands.
Speaker 1 (22:42):
And then a Fidelity survey found that one in three
inheritors sell an inherited home within the first year, often
without understanding the tax implications. So to recap what we
touched on on Tuesday, you start with the reality right
the emotional side, you just lost a loved one. Then
you have to make major financial decisions quickly. The Boober
generation again holds over fifty percent of US household wealth,
(23:04):
much of it is tied up into the home point
two immediate steps after inheriting the home. Corey did a
phenomenal job on this along with Dwight.
Speaker 2 (23:12):
Corey. I'm gonna stop.
Speaker 1 (23:13):
I think I want them to hear it from you
because you're the expert in this talk about point number
two that you want to get into the title and
so on and so forth, because this is such an
absolutely critical step.
Speaker 6 (23:23):
So you need to make sure first and foremost how
the title, how it's titled, how the property is titled.
Does your parents have a trust, Do they not have
a trust? Do they just have a will? If they
do not have a trust, more than likely you're going
to go through probate. As we talked about on Tuesday,
I highly recommend you can do it yourself if you want,
but I highly recommend to get an experience to state
(23:44):
probate attorney to take you through the process. Because you
have to notify creditors. You got to notify Medicare and medicay,
like we say, you got to notify all these different
things and handle things the right way. You have to
be named administrator. There's a bunch of different things. But
probate in and of itself isn't a scary thing. It's
just it sounds scary. But if you get a good attorney,
then get you through there.
Speaker 3 (24:03):
Good.
Speaker 6 (24:04):
If it was held in a trust and you just
happen to be the success or trustee and you are
the person that is in charge, now you want to
see who else is in there. You'll know who your
other who the other beneficiaries are. You need to make
sure you give them a copy of the trust, and
then you need to abide by the trust. Again, I
recommend talking to an attorney a lot of times it's
(24:24):
the attorney's office that drafted the trust, if possible, because
they'll know the most about it. Probably talk to a
CPA at the same time to figure things out and
then notify the beneficiaries of how you're going to start
taking the steps that are in the trust. But in
both cases, just remember this is all on you. You
have fiduciary duties. If you make a decision that costs
(24:47):
a bunch of tax losses for everybody else, guess who
gets to foot the bill when they come back at you.
You do so you have the right to get opinions
from experts and make those decisions. Kind of go from there.
Speaker 4 (25:01):
John, Remember too, we covered a solutions not just to
add somebody to the title too, because that everything too.
Speaker 1 (25:08):
Yes, and then the final point of that one too, Guys,
you've got to get a hold of like the richer
lace leases of the world. You have to get that
appraisal to an asapp the sooner the better to establish
a new cost basis. So coy that takes it. So, yeah,
it takes us to our third point. Understanding the stepped
up basis. It could be a great thing, could have
(25:28):
some downsides too.
Speaker 6 (25:29):
Yeah, it's it's most of the time. If it's if
it's a house that's been held forever, that's going to
have a low basis, meaning your parents or the people
that passed away paid a little bit of money for it.
Speaker 3 (25:40):
Now it's worth a bunch of money.
Speaker 6 (25:42):
Well, the stepped up basis is going to allow you
to step their cost bass up to the date of
their death.
Speaker 3 (25:48):
Then when you sell it.
Speaker 6 (25:48):
Theoretically, if you sold it for the exact same amount,
there'd be no tax to If you sell it for
a little bit more, you low some tax. If you
saw it for a little bit less, you have a loss.
It doesn't matter. But Richard Lace and like Richard appraisers
can set that value. And you know, John I even
hesitate saying this. You don't necessarily need that to file
your tax return. But if you get audited, which a
(26:10):
lot of times you will, you want it in your
file so you can say no, no. A third party
told me what the value was. That's why I felt
these things out the way I did it. The other
thing to remember too, I had this conversation with a
client today. Unfortunately, that people forget. If you're a beneficiary
and you get an inheritance, that is your personal property,
doesn't matter if you're married, that belongs to you period,
(26:32):
outside of anything else. If you start commingling those funds
with your spouse, you're walking a fine line of maybe
that's not all yours, and it's also protected from creditors
as long as it's not commingled. So if you get
a chunk of money from an inheritance, talk to somebody
so you understand what you should and shouldn't do with it.
The other thing, and it just caught me off guard
a few years ago, and maybe it was common knowledge.
(26:54):
But inheritance follows the bloodline, so it goes down, and
it will if the bloodline was a son and that
son has now passed away, it will bypass the spouse
and go to the grandchildren. Absolutely, so inheritance will follow
the blood line down. It doesn't automatically go to a
surviving spouse if that person wasn't part of that bloodline.
Speaker 1 (27:15):
However, in many times in life it does go to
that one. And hence why we always will talk to
clients and say, make sure that you love your son
in law, your daughter in law, and that you understand
that if you don't have certain provisions in the trust
upon your passing and you want this money to go
to let's say you've got a single child, go to
your son, but all of a sudden you don't like
his daughter in law. If you don't have certain provisions
in that trust, guess what that money could very easily
(27:37):
go to.
Speaker 2 (27:38):
That exit counter law. Yeah. Yeah, so very important for you, Cory,
very important.
Speaker 1 (27:42):
All right, So we want that stepped up cost basis.
We have to get an appraisal to do that. Once again,
we want to minimize the taxes if and when you
decide to sell or you know at some point you
will probably sell again.
Speaker 2 (27:51):
Where the skid says, we're wrapped up on Tuesday.
Speaker 1 (27:53):
Where it gets really messy is if you have multiple siblings,
to say the siblings are the only beneficiaries. You have
multiple siblings, say you got three of them, Say Corey
and I and DWIGHTE are brothers, and I'm like, no,
I want to cash out.
Speaker 2 (28:04):
I want my whatever.
Speaker 1 (28:05):
You know, three hundred thousand dollars worth of Corey and
Dwa are like, no, I want to keep this for
a long term investment. Then they got to figure out
a way to pay me out, buy me out over time.
You know, they go get a loan. There's a million situations,
but that always seems to happen. I rarely do I find.
I don't bet you, guys. Rarely do I ever find
if there's multiple people involved as beneficiaries, does everybody agree
No matter what the trust says, They're like.
Speaker 2 (28:27):
Okay, yeah, all this money is going to John Corey
and Dway.
Speaker 1 (28:29):
And then I can come out of the woodwork and go,
you know, guys, I know mom and Dad are giving
me my third but I don't want it.
Speaker 2 (28:34):
I want the cash. I need the cash, right. I
don't bet you guys.
Speaker 1 (28:36):
But I find rarely does you know the people into this,
all the siblings end up keeping it.
Speaker 2 (28:41):
They one wants to get out, yeah, and not all.
Speaker 6 (28:44):
So when we get in, when we get into that point,
and I was having this conversation with our friend Richard
Less a.
Speaker 3 (28:49):
Couple of weeks ago.
Speaker 6 (28:51):
If the trust says not to sell properties and keep
on renting, then that's what you're doing unless everybody can agree.
But if there's multiple properties and one or two people
need out, you have options. And what Richard and I
were discussing in his particular instance was you may not
need to sell the properties in order to generate some
cash to pay these people. Maybe you sit down and
you agree upon values and you died one of the
(29:13):
properties to the person.
Speaker 3 (29:14):
Let them sell.
Speaker 6 (29:14):
Because there's tax implications all the way around. So if
you're part of multiple people inheriting stuff and one or
two want to sell, make sure you understand what your
tax ramifications are if it happens, and then the trustees
should be making sure what everybody's tax ramifications are on
Plan A and Plan B because it changes, there's different
(29:35):
ways to get assets to and from beneficiaries.
Speaker 1 (29:40):
And then he gets even more messy if you're talking
about a rental property. Sure, yeah, tennants and leases, yes,
it's the whole thing. All right, let's squeeze this one in,
Guys or Corey at least the kind of the theme
of this fourth point. Should you keep it, should you
sell it? Should you in it? So when we come back,
Corey like you to run through the points things don't
(30:01):
remember if you decide to keep it, if you sell it,
if you're in it, we're talking about again. You just
inherited a home. Now, what with Corey and Dwight. Let's
turn it over to Christmas snow right now, traffic center. Hello, Kristen,
welcome back to the John Sanchez Show on Newstock seven
(30:21):
eighty k as. We have lost mister Mallardi had to
step out for a meeting. If you'd like to reach him,
of course seven seven five two four zero twenty twenty two.
Speaker 2 (30:28):
Mister Edge your phone umber.
Speaker 3 (30:29):
Serve six seven three six seven zero zero.
Speaker 1 (30:32):
Beautiful, Thank you, sir. All right, let's go to point
number four. Corey, should you keep it? Should you sell it?
Should you rent it? When we're talking about it inheriting
a home? Take it away?
Speaker 2 (30:40):
What do we have to keep it?
Speaker 3 (30:41):
I think if it fits into your lifestyle. I've seen
states before.
Speaker 6 (30:45):
They have multiple properties and managers in place that runs
like a well oiled machine. If you don't need the
cash right away, then then a lot of people keep
them because mom and dad made smart decisions and you
can just continue collecting the cash.
Speaker 1 (30:57):
So once again, multiple beneficiaries, multiple people inheriting this, everyone
potentially can have the different.
Speaker 2 (31:08):
Different objective, right.
Speaker 6 (31:09):
Everybody, they could the ones I've seen in the past.
If you have multiple properties and you've created a really
nice business machine, your trust is going to kind of
dictate how that machine is going to be handled.
Speaker 1 (31:22):
Her on commercial property or multi family, right like an
apartment building or something.
Speaker 2 (31:27):
Okay.
Speaker 6 (31:28):
The other thing to remember too is if there's cash,
you can cast somebody out with the cash, the other
beneficiaries keep the property. There's different ways to take care of.
Speaker 2 (31:37):
It, exactly, all right. What about the other option? Sell it?
Speaker 6 (31:41):
If you need the cat most of the time, John,
this is the case if you need the money, if
you've got other high debts outside that you can take
care of, if you've never been a landlord, if you've
never wanted to deal with things, if you want to.
You know, I've had a lot of people over the years.
It's just like I just want to have closure. I
just want to be done with it, move on. There's
nothing wrong with selling the property, and you know that's
(32:02):
what it was intended for, right exactly.
Speaker 1 (32:05):
And once again, just not to harp on this. If
you have siblings or others that your partners. You know,
I'll use the term partnership on this property or properties.
Speaker 2 (32:15):
Remember, folks, life is short.
Speaker 1 (32:18):
If you can't get along, if you're fighting, maybe if
you maybe you didn't get along before mom and Dad's death,
and you're definitely probably not going to get along now
that you're quote business partners.
Speaker 2 (32:26):
Throw that into your consideration.
Speaker 1 (32:27):
Also, I've seen it where it starts off where you know,
again everybody hates each other, and then they come together
and go, hey, you know, thanks mom and Dad, this
is a great retirement source of income for us, or
just the opposite. Man, We were really close, but the
old adage, you know, bloodsticker than water, and I can't
stand my siblings now because of this whole estate mess.
Speaker 2 (32:44):
So therefore get rid of it all right.
Speaker 1 (32:46):
So there's a lot of scenarios, But again I think
Corey gaves some great advice. Look at your situation first.
Then you got to come to an agreement as a group.
And if you can't, especially if there's only three of you, right,
can I have a majority or you can't have a majority.
But if there's two of you, can't have them majority there,
or if there's one of you you can always, you know,
end up hiring an arbitrator or an attorney or somebody
to kind of play that mediator role and go go
(33:08):
through the pluses and the minuses of selling it, et cetera.
Speaker 2 (33:11):
What about running it out, Corey, Obviously an option.
Speaker 3 (33:14):
It's always an option.
Speaker 6 (33:15):
With that one, I would definitely talk to a CPA,
get the text issues, Understand what it would be if
you sold it today, Understand what it would be if
you decide to keep it long term, and what it
might look like down the road. But again, if you
don't need the money, if the other beneficiaries are an agreement,
or if you're the single beneficiary, Yeah, it's if it
created a nice base for mom and dad, So there's
(33:37):
no reason it can't create a nice space for you.
Speaker 1 (33:39):
Absolutely. Okay, we're going to wrap it up with a conclusion.
We're gonna call this a state planning lessons. Here's what
we're going to advise on.
Speaker 2 (33:48):
Number one.
Speaker 1 (33:48):
In most cases, always consult to a legal professional. Probably
put the home in a revocable living trust to avoid
the probate. Put the estate obviously in the living trust
to avoid probate. Right, that is your number one issue.
The probate side of things, etc. Plus no specific instructions.
So please please please parents, grandparents. If you're going to
be letting your kids inherit your estate, it all starts
(34:11):
with the living trust. Number two, make your intentions very
very clear. Don't crowd it, don't make it all fancy.
Let the kids fight over what you or don't let
the kids fight over what you could have settled, meaning
having a clearly defined trust, saying this is like Corey's
referred to, these are my intentions, this is where I
want the money to go.
Speaker 2 (34:28):
Here's kind of the rules, et cetera.
Speaker 1 (34:30):
And remember, folks, if your property goes to to probate,
you can have a situation where no one can have
access to mom and Dad's bank account. Therefore, how they're
going to pay property taxes, mortgage if they're still a mortgage, etc.
Living trust estate planning absolutely vital. And lastly, keep the
property taxes and the titling strategies up to date. As
Cory said, things are changing all the time. Just make
(34:52):
sure you understand how the property is titled and mom
and dad. Final advice after you have a family meeting,
communicate this to your kids while you are alive. Don't
let it be a big secret where everybody has to
figure out what your intentions were once you're gone.
Speaker 2 (35:03):
Great, wrap it up ten seconds, right.
Speaker 6 (35:05):
I totally agree with all of those things, especially the titling,
and we've warked on it a lot. If you're going
to have a trust, which we highly recommend, set out
what you how you envision this thing happening once you're gone,
and make sure whoever you pick to follow those rules
will follow those rules.
Speaker 1 (35:22):
There you go, There you go. Excellent advice, all right, folks,
So well, hope you enjoy that. Make your estate planning
life a little bit easier through proper estate planning, and
you know, again assemble a great team to do all
this for you, and you know, let the kids benefit
from your years of hard work with your rental properties
and home et cetera. Great job, Grey, We'll do it again,
Tomorro on The John Sanchez Show, Goubless, how about great afternoon.
Speaker 5 (35:42):
DWAIGHTE. Millard n MLS ID number two four one two
five nine a licensed mortgage loan Officer with Highlands Residential
Mortgage Limited and Equal Housing Lender and MLS ID number
one three four eight seven one. The Information shared on
this live broadcast is for general information purposes only and
does not constitute or mortgage advice. Listeners should consult directly
(36:03):
with a license mortgage professional for guidance tailored to their
specific situation. All loans are subject to credit approval and
program guidelines. Not all applicants will qualify. Loan terms in
availability may vary by state and are subject to change
without notice. Highlands Residential Mortgage Limited is licensed in multiple states.
For a full list of state licenses and disclosures, please
(36:23):
visit https slash slash www dot highlandsmortgage dot com backslash
licenses backslash. The views expressed during this program are their
own and do not necessarily reflect those of Highlands Residential
Mortgage Limited.
Good Thursday afternoon to you. Welcome to the John Sanchez
Show on News Talk seven eighty K Whitch. It's a
pleasure to be with you and a pleasure to be
with my co host around the horn.
Speaker 2 (00:15):
We shall go.
Speaker 1 (00:16):
I'm not seeing much of a smile on his face
this afternoon, but let's see.
Speaker 2 (00:20):
We can get there. It is there is Dwight Millard Heighlands. Okay, buddy, Okay.
Speaker 3 (00:24):
I'm doing fine.
Speaker 2 (00:25):
Okay. I just want to make sure.
Speaker 1 (00:26):
I mean, nothing's happening in bomb in mortgage rates due
to the bomb market. Nothing happening, so all right, I
just want to make sure. It's like, did you know something.
Speaker 2 (00:34):
I don't know?
Speaker 4 (00:35):
No, no, just a little quiet, little quiet. But I
mean they're blaming it now on just the government shutdown.
There's another yawn or no, no, no data, no anything.
So right exactly, I guess, but we all, I guess
we all should just take off right.
Speaker 2 (00:48):
Right right, Yeah, that's true, that's true. Corey individuality.
Speaker 3 (00:53):
How are you, my friend, I'm doing fantastic.
Speaker 2 (00:55):
Good good mister Louk. I love it. I love it.
Speaker 1 (00:58):
Always smile it all right, flks, Well, thanks so much
for joining us. We're going to recap today's stock market activity,
a bit of a rough one on the Dow side
of things, kind of okay on the Nasdaq in the
SMB after record setting day after day, but we didn't
get that today. Giving an update of course of everything
that happened, and then we're going to get into our
real estate topic. We're going to continue what we started
on Tuesday because we as always ran out of time,
(01:20):
and our topic on Tuesday was you just inherited a house?
Speaker 2 (01:24):
Now?
Speaker 5 (01:24):
What?
Speaker 2 (01:25):
Right?
Speaker 1 (01:26):
Again, this is all centered around what we've been discussing
quite frequently on this program, which is the biggest wealth
transfer in history by many economists, is going to occur
starting next year. Through they've been about whose numbers you
look at at least for the next ten fifteen years,
right the Dwight Night's generation, the baby boomers passing wealth
(01:49):
on to our kids and so on and so forth,
and again it's going to be one of the largest
ever in history, trillions of dollars. Of this trillions of
dollars is going to be in the real estate side.
What was the numbers, guys, like fourteen trillion, right, something
like that. If you touch on Tuesday, that is just
going to be the real estate. So the odds are
many of you are going to be inheriting real estate
(02:11):
from your parents most likely. But before you think you
just hit the lottery and get all excited, we want
you to step back a little bit and if it
hasn't happened, this is a great time to learn about
what this entire process is about. What should you really
do if you inherit the home? Should you keep it?
Should you sell it? Should you rent it?
Speaker 2 (02:28):
Right?
Speaker 1 (02:28):
Those are your three primary options. Well, today we're going
to continue our discussion. Like I said that, we started
on Tuesday on the financial, the tax, and the emotional decision,
because unlike any other form of real estate, this does
have an emotional piece to the puzzle. So we're going
to talk about that. Last Tuesday we got through you know,
you start with reality number one. Number two point we
(02:50):
touched on was the immediate steps after inheriting the home,
and then we left off on point three, which is
understanding the stepped up basis. So we're going to recap
real quickly what we touched on on point one too
and then getting into our fresh topics. But again, the
odds are based upon the Great wealth transfer that many
are predicting that again, at some point you're probably going
to be one of these people inheriting money, or if
(03:11):
you're on the parents side, you're going to be moving
this real estate over to your children, grandchildren, etc. So
it's gonna be a great learning listen for everybody. We're
excited to share it with you. But in the meantime,
let's get down to the stock market side of things.
So if you notice, we've been firing some shots across
the bow, as the saying goes, watch this market. Things
are a little frothy in many investors' minds and many
(03:31):
strategy many traders' minds. It just takes a little bit
of this, a little bit of that, and we can
start to succumb to some selling pressure pretty quickly. Well
today we did that at least on the Dow side
of things. We're recovered on the Nasdaq and the S ANDP.
But this market is becoming very fragile right now. President
came out today again. We're in what today is what
the ninth day of the government shut down. As I
(03:52):
shared this morning on my stock Updates, I feel this
is my personal opinion. I'm feeling that investors are starting
to get a little bit of a little bit of anxiety. Right,
nine days, they're not seeing any economic data, as you'll
find out when Deight gives us the mortgage side of things.
People are just kind of getting a little bit of Okay,
how long is this thing really going to go on?
Speaker 2 (04:12):
That I was just sharing with the boys before we started.
I got a news headline.
Speaker 1 (04:16):
It came out at two fifty five from the Bureau
of Labor Statistics. They have recalled their staff too ready
this September CPI report by months in. That's according to Bloomberg,
So you know that's okay, So they're going to get
the staff in there and get the CPI report ready
for the end of the month. So, I mean, here
we are, the ninth of October. Is this just a
(04:37):
preemptive move? Do they know something we don't know as
far as the government shut down coming to and who knows?
Speaker 2 (04:42):
Right?
Speaker 1 (04:42):
So, but I thought that was very interesting to see
that headline. But back to the nervousness of the market.
So we're again nine days. Remember our last one was
thirty three days that the government was shut down, So
we've got a ways to go. We're going to match
and beat that one. So we're nine days into it,
we're not getting any economic reports. Market is kind of
looking for some information right now, looking for some direction. Again,
(05:04):
the concerns keep coming up about AI and valuations and
circular accounting, all the things that I keep talking about
every single day. This is what we're talking about today.
Kind of felt that way that it's like, Okay, people
starting to get a bit nervous on things.
Speaker 2 (05:15):
But again that's just today.
Speaker 1 (05:17):
We'll see if there's no trend developing by any means,
Just again, be cautious, have a defensive strategy in place,
be ready to go if again, you know, we get
into these situations, you know where the market can move.
Speaker 2 (05:29):
South on you very quickly.
Speaker 1 (05:31):
You know.
Speaker 2 (05:31):
It's funny, guys.
Speaker 1 (05:31):
It was about nine o'clock last night and I was
getting ready to go to bed, and I was looking
at my phone set in my alarm, and I looked
at the just one look at me, you know, last
minute news stories, and I had deja vu. There was
a picture of a twenty three year old kid that
used to he got started. He graduated to Colombia at
nineteen years old, went to work for Elon Musk I
(05:52):
think at Tesla or at X and now he's launched
his own AI company and you can still see the
pipples on his face, but he's now a billion And
I took I took a screenshot of that. I sent
it to Jason and I said, if this isn't reminiscent
of the dot com era, when remember that, guys? I mean,
they can these kids that some of them weren't even twenty
(06:13):
one years I remember joking about that on the radio show.
There were something that weren't even twenty one years old,
not old enough to drink, and they're like instant millionaires overnight,
hundreds of millions of dollars. And now you start seeing
some of that going on with this new boom of
the AI side of things. And yeah, I just thought
it was kind of a kind of interesting to see
that happened.
Speaker 2 (06:29):
That a lot of a lot of similarities going on there.
Speaker 3 (06:33):
As I say, John, go back to that era.
Speaker 4 (06:37):
These kids did they get in before the IPOs?
Speaker 3 (06:40):
Did they? I mean were there? You know, hey, you
know give you that.
Speaker 2 (06:43):
That's a great question.
Speaker 4 (06:44):
And what what gave them? Remember all of a sudden.
Speaker 2 (06:46):
It just yeah and wealth.
Speaker 1 (06:48):
I just I reflected it what happened with Jason yesterday
on the show. Because I was, you know, obviously in
the thick of things at that point. So I was
living in Bakersfield. I started on the radio station. You know,
I still had the brokerage form. I just went independent
at ninety nine and started on the radio station there
in ninety seven, and then then they gave me my
own show at about I think nineteen ninety eight, and
(07:09):
then stock updates very similar to what I do now.
But in ninety nine they moved into primetime. I was
at five o'clock, and so I had a massive, huge audience, right,
and I remember telling the audience that, you know, watch
what's going on in this whole dot com era? Right,
because once again to relive that, Dwight, it was all
you had to do, all literally all you had to
(07:30):
do is put dot com at the end of your
corporate name. And people immediately thought, oh, this is Internet related,
let's buy their stock. I mean, as stupid as that
sounds in retrospect, that was it. So what did I do.
I formed a corporate California corporation called Stocktalkamerica dot Com
and I was the only shareholder of it, and I
issued myself. I can't remember the exact number, but it
(07:52):
was some crazy number like I don't know, one hundred
thousand shares, you.
Speaker 2 (07:55):
Know, worth point zero zero one cent, right, But I
had it. I had it, you know, in my office
and stuff, and I still have that. And what did
I do?
Speaker 1 (08:04):
I call it stock Talk America dot com right just
on the whatever hopes.
Speaker 2 (08:08):
That's how crazy things were that I had dot common
in my name.
Speaker 1 (08:11):
Maybe someone who want to come to buy the you know,
the rights to my radio show or something.
Speaker 2 (08:14):
You know.
Speaker 1 (08:15):
But that's what it was to Wight. It is you
put dot com, people would jump on it. And then
so these guys would start these companies with nothing, no earnings.
Matter of fact, they were you think, you know, some
of the burn cash rates are high right now with
AI companies. It ain't nothing, you know, compared to what
we saw back in the dot com era. So start
these companies with nothing, you know, start in the in
the basement, whatever they did, put dot com on it.
(08:36):
Next thing you know, they're losing hundreds of millions of dollars.
And next thing you know, they're going on the on
the stock market. And then investors, oh my god, it's
dot com. It's an IPO grab it, and then the
stock runs up. These kids overnight are becoming again, you know,
multi multi millionaires. And then what happens reality sets in,
you know, sometimes a month later, a couple months later,
(08:57):
they're like, hey, we're out of cash. Can we do
a second marry stock offering? And of course at that
point the dot com bubble began to burst when everyone
was like no, yeah, dot call in your name, We're
not touching you.
Speaker 2 (09:06):
And then booth they just disappear, go bankrupt.
Speaker 3 (09:09):
And how many of them cashed out?
Speaker 2 (09:11):
That's right, that's right, very few, yep o.
Speaker 3 (09:15):
Well, I mean a lot of them, a.
Speaker 1 (09:16):
Lot of them did they They made the money in
the I p O Corey and then and then the
shareholders got screwed as always yeah yeah yeah, but but
to your I think what you're referring to, you know,
shareholder wise, how many got out?
Speaker 2 (09:28):
Yeah, not many, not.
Speaker 6 (09:29):
Many, well, the shareholders and then depending on the lock
up periods and whatnot. But yeah, there were there were
a lot of people just like today that believe their
own hype, you know what I mean.
Speaker 3 (09:39):
And so it's very interesting.
Speaker 2 (09:42):
Yeah, yeah, yeah, exactly.
Speaker 1 (09:44):
It was a it was fun to reflect back, and
I hadn't thought about those days, you know, like I said,
until yesterday.
Speaker 2 (09:48):
So that's funny you bring that.
Speaker 4 (09:49):
Up and there's still a few out there, you know.
Speaker 1 (09:51):
Yeah, well you know I saw a stat today because
well i'll dig get up at the break.
Speaker 2 (09:56):
Yeah, well I'll bring it up.
Speaker 1 (09:59):
But base it's saying a massive percent of the market
is going up because of a very small percentage of
the AI dominated countries or companies, right, and and you
know you start looking at that and you go, once again,
we're starting to get top heavy.
Speaker 2 (10:15):
Right, We've heard the term magnificent seven.
Speaker 1 (10:16):
Right, Remember the last couple of years you've had the majority,
the majority of the market gains were attributed to essentially
seven companies, the Google, so on and so forth. But
to my point in this article, it talks about back
to that era, Cisco, right, very prominent, you know, market
leader right now, they were down to like two bucks
in that dot com bubble burst and you know they
they were one of the survivors. So once again the
old analogy comes back to it's he who has the
(10:40):
strong or the biggest ballot.
Speaker 2 (10:42):
They are the ones that survived.
Speaker 1 (10:43):
And it's going to be the same way I'm telling
you it's going to be the exact same way with
this AI situation because there's so much fraud right now
they're buying. There's so much money, much more money, much
more capital involved in the AI ecosystem, right, because what
was different than the dot com? Well, do I launch
the dot com in your bedroom and you know you
don't have any bricks and mortars or anything.
Speaker 2 (11:03):
It's not the case here, right.
Speaker 1 (11:04):
You're Jensen Wong, the CEO of in the video, was
on CMDC yesterday. He goes look at just to get
a one gigawat data center up and running, you're talking
eight to ten billion dollars. And now they're bringing on
these you know again, ten gigawatt data centers, right, massive
massive ones that are there. You've got serious capital involved,
(11:24):
and you know Corey List following the capital trail as
much as I do. You know, where's the capital coming from?
Venture capital funds? You know, basically private equity money, et cetera. Right,
So they lend it to x y Z company to
build it. There's another party, the actual construction company and
the builder of it. And then you go down the
food chain and guess what you take a let's say
(11:45):
an open AI or one of these other companies.
Speaker 2 (11:47):
Do you think that they Corey, You're you're the real
estate guru.
Speaker 1 (11:50):
Did open Ai if they're building one of these massive
data centers, just to pick on them, are they are
they buying that real estate those those data centers.
Speaker 3 (11:58):
Oh, probably least, and I would assume exactly, yeah.
Speaker 2 (12:01):
Of course, why they're not burning up capital doing that.
Speaker 1 (12:05):
But most importantly, if things fizzle, which they will, and
some of these data centers and these companies are gonna fail,
you're gonna see a lot of empty data centers in
my opinion, down the road, what do they do.
Speaker 2 (12:14):
They go bankrupt? Do they write it off? Right?
Speaker 1 (12:16):
It's not like they have to sit there and sell
the real estate and they didn't have to cross collateralize
every asset they have, which none of them have any assets.
Speaker 2 (12:22):
They can get out and qualify for a mortgage right way.
Speaker 1 (12:25):
So yeah, So it's it's that chain where it starts
with the private equity, the venture capital who you know
really funding the money. Are very high interest rates. I mean,
I'm shocked to see some of these interest rates. And
then they lend it, you know for the construction side,
and then you get somebody else that'll come in, some
of the real estate investment trusts, etc.
Speaker 2 (12:40):
That'll come in.
Speaker 1 (12:41):
They'll actually buy, you know, foot the bill for the
entire construction. They'll cash everybody out. Now they now it's
on their balance sheet, and then their hope is they
turn around and lease it to you know, the Open
Ayes of the world or some of these other companies.
And even even the chips to Wight. Even the chips
in these data centers, most of them are leased from videot.
They don't even own the chips. So what skin in
(13:03):
the game do they have. Did you look to see
the amount of money that open Ai is borrowing. I mean,
it's nothing for them to go out and go, oh yeah,
we're doing a dead offering for five hundred billion, half
a trillion dollars. Investors aren't blinking and eye It's like,
oh my god, this thing is just going to be
the most phenomenal.
Speaker 6 (13:17):
I hope it is, isn't it?
Speaker 1 (13:19):
And I kind of goes which I pause, you my god,
So behind pause one second here, let's turn it over
to the wonderful Christen Snow right now Trottic Center.
Speaker 2 (13:27):
Sorry Kristin, Welcome back.
Speaker 1 (13:39):
To the John Sanchez Show on News Talk seven eighty KO,
which the Corey edge of edge reality to White Mollard
of a centers you want, Lindy per centers you want?
Whoa where'd that come from? How about Highlands mortgage? Yeah,
my goodness, lashing to the bath question of the bath?
All right, two forty three loss on the days how
we finish up? There is a half a percent point
five to two to be exact, with the close of
forty six three sixty eight as I lost nineteen and
the SMP on nineteen.
Speaker 2 (14:00):
Also Oil Doug fifteen give up sixty one to forty two.
Speaker 1 (14:04):
A barrel that run on gold broke a by that
four thousand mark yesterday or the last couple days. It
came back to below the four thousand mark today three
thousand and nine seventy six to fifteen ounce down ninety
three dollars to ninety cents an ounce, and mister Mallard
to two basis point increase on the ten year four
to fifteen is our yield.
Speaker 2 (14:21):
Educatus on the mortgage side.
Speaker 4 (14:22):
Fight here we go, Yon Yon Yon, no report, so
you know, no bond trading. So the thirty year mortgage
is exactly what it was on Tuesday six point three eight.
You got a couple basis points improvement on the fifteen
year to five eight eight, and then the Fahava.
Speaker 3 (14:38):
Is at six point zero five and six point zero.
Speaker 4 (14:40):
Seven, so a little bit of improvement on those those fronts,
but the thirty year fix just hold steady.
Speaker 1 (14:47):
Nothing, yep, exactly nothing, all right. A little bit of
local real estate news, thank you to Wright. A little
bit of local real estate news reported this morning in
the Reno Gazette that City of Reno has approved ad us.
Speaker 2 (14:59):
Mister Edge, tell us about that good.
Speaker 6 (15:01):
Access you know, it depends on depends on who you're
talking to, but accessory dwelling units. This has been going
on for I don't know how long, So last night
was the final vote.
Speaker 3 (15:10):
I suppose, uh so.
Speaker 6 (15:12):
Accessory dwelling un it's I didn't read it John as
far as the in depth statutes, but basically, if you
have a house and you have enough size and you
have enough parking.
Speaker 2 (15:20):
Now you can build a square foot minimum.
Speaker 6 (15:23):
Is that what it was yet and they usually have
a parking component in there, so now you can build
a separate structure on your property for your mother in
law or they're going to allow rentals, and they're going
to allow short term rentals, and I think, if I
understood it correctly, kind of unfettered use of short term rentals.
So they are talking about going in and getting a
(15:45):
handle on that, because it always scares me when they
talk about, oh, we're going to allow these ADUs and
then they compare it to people that want to come
in town like they do for a hotel room. Like
people buy their house and neighborhoods, so they're not staying
in a hotel room. So now you're gonna let my
neighbor built something. But you know, don't get me started
on it. I'm not a huge fan of it. My
cynical side is if you build more houses, more people
(16:06):
will move here, and that's not what I'm looking for.
But anyway, we'll see.
Speaker 1 (16:11):
But isn't this just the opposite, though, Corey, because we've
we've done a lot of shows on adu's. Remember a
few years ago down in the Bay Area they allowed
these and it was.
Speaker 2 (16:18):
Like, oh my gosh, finally you know I got I
can do this.
Speaker 1 (16:22):
Isn't it more so validating that the reason they are
allowing this is because that it is too expensive to
to there's a how to start at the beginning.
Speaker 2 (16:34):
There's a housing shortage.
Speaker 1 (16:35):
So Dwight can build an ADU in his backyard for whatever,
one hundred thousand dollars, he can turn around and rent
it out to Corey Edge, who you know, is a
single guy, doesn't have any family, blah blah blah blah.
Speaker 2 (16:45):
And that's gonna.
Speaker 1 (16:46):
Ease some of the pressure on the housing, Isn't that
kind of the underlying gist of it.
Speaker 6 (16:51):
That's the underlying gist. My again, my cynical opinion is
we don't have a housing problem. We have a people problem. Okay,
there's too many people.
Speaker 3 (16:58):
That's just me thousand problem.
Speaker 6 (17:02):
Yeah, yeah, we don't have a housing issue. But there's
some of the things to remember. There's certain neighborhoods you
can't do it. And if you have CCNRS restrictions, I
don't care how old they are, I live in a
neighborhood with restrictions from nineteen forty eight.
Speaker 3 (17:15):
You're not going to be allowed to build them.
Speaker 2 (17:16):
There.
Speaker 6 (17:17):
The state and the legislature and even the local government
cannot override existing property restrictions, so they'll be lawsuits over it.
But it's not going to fit every single neighborhood.
Speaker 3 (17:29):
Let's put it that way.
Speaker 1 (17:31):
So your advice to someone that says, Okay, I fit
the criteria. I've got five thousand square feet plus i
don't have an hlay, but man, I'd love to build
something and get a thousand dollars a month rent.
Speaker 2 (17:41):
What's your advice to someone like that?
Speaker 3 (17:43):
Run the number.
Speaker 6 (17:44):
So the first thing is if you hit all the criteria,
meet with the contract of what's it going to cost
to build this? So if you think you can rent
it for let's call the hypothetical thousand dollars a month,
but it's going to cost you seven or fifty thousand
dollars to build, that doesn't make much sense. So you
still have to run the numbers that way. You can also,
I guess, kind of look at how it would potentially
(18:05):
increase your property value. But as Richard Lace would let
it and property taxes and all this stuff, Richard Lace
would let us know that if you think it's going
to increase your property values by x, he is an
appraiser would have to go out and find other similar properties.
Speaker 3 (18:19):
That have ADUs.
Speaker 6 (18:20):
You don't just get to, you know, spend five hundred
thousand dollars and then add five hundred thousand dollars to
your value.
Speaker 4 (18:26):
And I need to make a very important point, and
Corey jump in on this. Remember in the state of Nevada,
it's cost minus appreciations. How they come to your tax bill. Okay, John,
So the older the house, the lower the tax bill.
In theory, the moment you go get a permit to
add on to your house, Boom, you're back on there
in your tax right, Corey, Your tax base has just
(18:49):
changed from that point. So the moment you go pull
a permit, you just wiped out.
Speaker 2 (18:55):
Your son for the numbers real quick.
Speaker 1 (18:58):
So let's say I bought a house ten years ago
and it was five hundred thousand, So that's my cost basis. Okay,
you said cost minus appreciation, so property tax value. Let's
say it's three hundred thousand, right, that's the value and
paying my property tax on You're saying, if I go
high contractor and build an ADU and let's say it's
worth one hundred thousand, my cost basis now is the
five plus the one hundred something.
Speaker 3 (19:18):
The moment you pull up permit.
Speaker 4 (19:20):
The moment you pull up permit, Corey, correct me if
I'm wrong, but the moment, so let me give you.
Let me give you an example. In the old Southwest Reno,
you could buy a million and a half dollar house
and the property taxes, John, are are one hundred and
twenty five a month.
Speaker 2 (19:34):
I've done one one hundred and twenty five dollars a month.
Speaker 4 (19:37):
The moment you go pull up permit to do an
interior reconstruction or add on, you're no longer at the
one twenty five, they're.
Speaker 6 (19:45):
Gonna want what they do. Did not but what they do.
And in your example, John, it's not your cost basis.
So like what I mentioned, you can spend a million dollars,
but if the house was built nineteen twenty, it's depreciated
back to nineteen twenty. If your neighbor, if your neighbor
spends a million dollars on a brand new house, his taxes,
his or her taxes will be ten times higher than yours,
(20:07):
even though.
Speaker 3 (20:07):
You spent the same amount of money.
Speaker 1 (20:09):
So it's the age of original Yes cost when you
actually when it was actually built, could have been.
Speaker 6 (20:14):
Yes to appreciate it back, so they appreciate it back
to the time it was built. In Dwight's example, they
don't automatically take you to the brand new thing.
Speaker 3 (20:23):
They do a blended.
Speaker 6 (20:24):
So if you look at the assessor stuff, sometimes they'll
say like built in twenty nine, but I can't remember
the word they use, but like blended built in nineteen
seventy two because somebody did an upgrade halfway. So they
don't take you to the full boat. But you don't
you lose the benefit of.
Speaker 4 (20:39):
The long one, so you will get a bump in
your taxes. So you got to cure that in too,
A good point.
Speaker 3 (20:45):
And the other thing too well, ok ahead, before we
get off it.
Speaker 6 (20:48):
If you're going to build one of these things to
do short term rentals, they are actively talking about and
they will come in and put regulations on them. So
don't bet the family farm on making rental income because
of change in a year.
Speaker 2 (21:01):
Okay, yeah, oh no, that was crazy. Just work cool? Good?
Could you lend on that? Can I we're getting to
that point now.
Speaker 4 (21:09):
Yeah, but right now I think typically what you do
is probably go get an equity line because you're locked
into Go get a nice equity line to cover the
construction or whatever you can do there versus mess up.
Speaker 2 (21:18):
First all right.
Speaker 1 (21:19):
I saw it as a big breakthrough, but like anything,
there's pluses and minus thanks guys related laying out the
negative side of it, And I don't mean that in
a bad sense. It's like, man, glad to know that
now versus yeah, someone getting excited and going out, like
you said, betting the family farm on it, no pun intended.
Speaker 2 (21:34):
All right, we come back. You just inherited a house,
now what.
Speaker 1 (21:36):
We'll get to our topic, but first it's turn it
to Jack Saban, who has news trafficking weather. Hello Jack,
welcome back to the John Sanchez Show on Newstock seven
eighty k, which with Corey Aage of Edge related a
white and Larti Highlands mortgage two forty three loss on
(21:58):
the Dow down nineteen on the NASDAK and on the
S and P five hundred. All right, let's get to
our topic that we started on Tuesday but ran out
of time. All right, great wealth transfer. Let's give you
some stats to get this kicked off and refresh your memory.
According to Sorelli and Associates, eighty four trillion dollars in
assets are expected to be passed down through estates between
the year of twenty twenty four and the year of
(22:19):
twenty forty five.
Speaker 2 (22:20):
Of that sixteen trillion, there's that number, guys.
Speaker 1 (22:23):
Sixteen trillion dollars is going to transfer within the next decade,
and about half of the wealth is going to be
tied to real estate, particularly in California, Florida, Texas and
high other high appreciation states. Forty five percent of Americans
eight to fifty five plus own their home outright, almost
a half, meaning millions of properties.
Speaker 2 (22:40):
Are going to soon change hands.
Speaker 1 (22:42):
And then a Fidelity survey found that one in three
inheritors sell an inherited home within the first year, often
without understanding the tax implications. So to recap what we
touched on on Tuesday, you start with the reality right
the emotional side, you just lost a loved one. Then
you have to make major financial decisions quickly. The Boober
generation again holds over fifty percent of US household wealth,
(23:04):
much of it is tied up into the home point
two immediate steps after inheriting the home. Corey did a
phenomenal job on this along with Dwight.
Speaker 2 (23:12):
Corey. I'm gonna stop.
Speaker 1 (23:13):
I think I want them to hear it from you
because you're the expert in this talk about point number
two that you want to get into the title and
so on and so forth, because this is such an
absolutely critical step.
Speaker 6 (23:23):
So you need to make sure first and foremost how
the title, how it's titled, how the property is titled.
Does your parents have a trust, Do they not have
a trust? Do they just have a will? If they
do not have a trust, more than likely you're going
to go through probate. As we talked about on Tuesday,
I highly recommend you can do it yourself if you want,
but I highly recommend to get an experience to state
(23:44):
probate attorney to take you through the process. Because you
have to notify creditors. You got to notify Medicare and medicay,
like we say, you got to notify all these different
things and handle things the right way. You have to
be named administrator. There's a bunch of different things. But
probate in and of itself isn't a scary thing. It's
just it sounds scary. But if you get a good attorney,
then get you through there.
Speaker 3 (24:03):
Good.
Speaker 6 (24:04):
If it was held in a trust and you just
happen to be the success or trustee and you are
the person that is in charge, now you want to
see who else is in there. You'll know who your
other who the other beneficiaries are. You need to make
sure you give them a copy of the trust, and
then you need to abide by the trust. Again, I
recommend talking to an attorney a lot of times it's
(24:24):
the attorney's office that drafted the trust, if possible, because
they'll know the most about it. Probably talk to a
CPA at the same time to figure things out and
then notify the beneficiaries of how you're going to start
taking the steps that are in the trust. But in
both cases, just remember this is all on you. You
have fiduciary duties. If you make a decision that costs
(24:47):
a bunch of tax losses for everybody else, guess who
gets to foot the bill when they come back at you.
You do so you have the right to get opinions
from experts and make those decisions. Kind of go from there.
Speaker 4 (25:01):
John, Remember too, we covered a solutions not just to
add somebody to the title too, because that everything too.
Speaker 1 (25:08):
Yes, and then the final point of that one too, Guys,
you've got to get a hold of like the richer
lace leases of the world. You have to get that
appraisal to an asapp the sooner the better to establish
a new cost basis. So coy that takes it. So, yeah,
it takes us to our third point. Understanding the stepped
up basis. It could be a great thing, could have
(25:28):
some downsides too.
Speaker 6 (25:29):
Yeah, it's it's most of the time. If it's if
it's a house that's been held forever, that's going to
have a low basis, meaning your parents or the people
that passed away paid a little bit of money for it.
Speaker 3 (25:40):
Now it's worth a bunch of money.
Speaker 6 (25:42):
Well, the stepped up basis is going to allow you
to step their cost bass up to the date of
their death.
Speaker 3 (25:48):
Then when you sell it.
Speaker 6 (25:48):
Theoretically, if you sold it for the exact same amount,
there'd be no tax to If you sell it for
a little bit more, you low some tax. If you
saw it for a little bit less, you have a loss.
It doesn't matter. But Richard Lace and like Richard appraisers
can set that value. And you know, John I even
hesitate saying this. You don't necessarily need that to file
your tax return. But if you get audited, which a
(26:10):
lot of times you will, you want it in your
file so you can say no, no. A third party
told me what the value was. That's why I felt
these things out the way I did it. The other
thing to remember too, I had this conversation with a
client today. Unfortunately, that people forget. If you're a beneficiary
and you get an inheritance, that is your personal property,
doesn't matter if you're married, that belongs to you period,
(26:32):
outside of anything else. If you start commingling those funds
with your spouse, you're walking a fine line of maybe
that's not all yours, and it's also protected from creditors
as long as it's not commingled. So if you get
a chunk of money from an inheritance, talk to somebody
so you understand what you should and shouldn't do with it.
The other thing, and it just caught me off guard
a few years ago, and maybe it was common knowledge.
(26:54):
But inheritance follows the bloodline, so it goes down, and
it will if the bloodline was a son and that
son has now passed away, it will bypass the spouse
and go to the grandchildren. Absolutely, so inheritance will follow
the blood line down. It doesn't automatically go to a
surviving spouse if that person wasn't part of that bloodline.
Speaker 1 (27:15):
However, in many times in life it does go to
that one. And hence why we always will talk to
clients and say, make sure that you love your son
in law, your daughter in law, and that you understand
that if you don't have certain provisions in the trust
upon your passing and you want this money to go
to let's say you've got a single child, go to
your son, but all of a sudden you don't like
his daughter in law. If you don't have certain provisions
in that trust, guess what that money could very easily
(27:37):
go to.
Speaker 2 (27:38):
That exit counter law. Yeah. Yeah, so very important for you, Cory,
very important.
Speaker 1 (27:42):
All right, So we want that stepped up cost basis.
We have to get an appraisal to do that. Once again,
we want to minimize the taxes if and when you
decide to sell or you know at some point you
will probably sell again.
Speaker 2 (27:51):
Where the skid says, we're wrapped up on Tuesday.
Speaker 1 (27:53):
Where it gets really messy is if you have multiple siblings,
to say the siblings are the only beneficiaries. You have
multiple siblings, say you got three of them, Say Corey
and I and DWIGHTE are brothers, and I'm like, no,
I want to cash out.
Speaker 2 (28:04):
I want my whatever.
Speaker 1 (28:05):
You know, three hundred thousand dollars worth of Corey and
Dwa are like, no, I want to keep this for
a long term investment. Then they got to figure out
a way to pay me out, buy me out over time.
You know, they go get a loan. There's a million situations,
but that always seems to happen. I rarely do I find.
I don't bet you, guys. Rarely do I ever find
if there's multiple people involved as beneficiaries, does everybody agree
No matter what the trust says, They're like.
Speaker 2 (28:27):
Okay, yeah, all this money is going to John Corey
and Dway.
Speaker 1 (28:29):
And then I can come out of the woodwork and go,
you know, guys, I know mom and Dad are giving
me my third but I don't want it.
Speaker 2 (28:34):
I want the cash. I need the cash, right. I
don't bet you guys.
Speaker 1 (28:36):
But I find rarely does you know the people into this,
all the siblings end up keeping it.
Speaker 2 (28:41):
They one wants to get out, yeah, and not all.
Speaker 6 (28:44):
So when we get in, when we get into that point,
and I was having this conversation with our friend Richard
Less a.
Speaker 3 (28:49):
Couple of weeks ago.
Speaker 6 (28:51):
If the trust says not to sell properties and keep
on renting, then that's what you're doing unless everybody can agree.
But if there's multiple properties and one or two people
need out, you have options. And what Richard and I
were discussing in his particular instance was you may not
need to sell the properties in order to generate some
cash to pay these people. Maybe you sit down and
you agree upon values and you died one of the
(29:13):
properties to the person.
Speaker 3 (29:14):
Let them sell.
Speaker 6 (29:14):
Because there's tax implications all the way around. So if
you're part of multiple people inheriting stuff and one or
two want to sell, make sure you understand what your
tax ramifications are if it happens, and then the trustees
should be making sure what everybody's tax ramifications are on
Plan A and Plan B because it changes, there's different
(29:35):
ways to get assets to and from beneficiaries.
Speaker 1 (29:40):
And then he gets even more messy if you're talking
about a rental property. Sure, yeah, tennants and leases, yes,
it's the whole thing. All right, let's squeeze this one in,
Guys or Corey at least the kind of the theme
of this fourth point. Should you keep it, should you
sell it? Should you in it? So when we come back,
Corey like you to run through the points things don't
(30:01):
remember if you decide to keep it, if you sell it,
if you're in it, we're talking about again. You just
inherited a home. Now, what with Corey and Dwight. Let's
turn it over to Christmas snow right now, traffic center. Hello, Kristen,
welcome back to the John Sanchez Show on Newstock seven
(30:21):
eighty k as. We have lost mister Mallardi had to
step out for a meeting. If you'd like to reach him,
of course seven seven five two four zero twenty twenty two.
Speaker 2 (30:28):
Mister Edge your phone umber.
Speaker 3 (30:29):
Serve six seven three six seven zero zero.
Speaker 1 (30:32):
Beautiful, Thank you, sir. All right, let's go to point
number four. Corey, should you keep it? Should you sell it?
Should you rent it? When we're talking about it inheriting
a home? Take it away?
Speaker 2 (30:40):
What do we have to keep it?
Speaker 3 (30:41):
I think if it fits into your lifestyle. I've seen
states before.
Speaker 6 (30:45):
They have multiple properties and managers in place that runs
like a well oiled machine. If you don't need the
cash right away, then then a lot of people keep
them because mom and dad made smart decisions and you
can just continue collecting the cash.
Speaker 1 (30:57):
So once again, multiple beneficiaries, multiple people inheriting this, everyone
potentially can have the different.
Speaker 2 (31:08):
Different objective, right.
Speaker 6 (31:09):
Everybody, they could the ones I've seen in the past.
If you have multiple properties and you've created a really
nice business machine, your trust is going to kind of
dictate how that machine is going to be handled.
Speaker 1 (31:22):
Her on commercial property or multi family, right like an
apartment building or something.
Speaker 2 (31:27):
Okay.
Speaker 6 (31:28):
The other thing to remember too is if there's cash,
you can cast somebody out with the cash, the other
beneficiaries keep the property. There's different ways to take care of.
Speaker 2 (31:37):
It, exactly, all right. What about the other option? Sell it?
Speaker 6 (31:41):
If you need the cat most of the time, John,
this is the case if you need the money, if
you've got other high debts outside that you can take
care of, if you've never been a landlord, if you've
never wanted to deal with things, if you want to.
You know, I've had a lot of people over the years.
It's just like I just want to have closure. I
just want to be done with it, move on. There's
nothing wrong with selling the property, and you know that's
(32:02):
what it was intended for, right exactly.
Speaker 1 (32:05):
And once again, just not to harp on this. If
you have siblings or others that your partners. You know,
I'll use the term partnership on this property or properties.
Speaker 2 (32:15):
Remember, folks, life is short.
Speaker 1 (32:18):
If you can't get along, if you're fighting, maybe if
you maybe you didn't get along before mom and Dad's death,
and you're definitely probably not going to get along now
that you're quote business partners.
Speaker 2 (32:26):
Throw that into your consideration.
Speaker 1 (32:27):
Also, I've seen it where it starts off where you know,
again everybody hates each other, and then they come together
and go, hey, you know, thanks mom and Dad, this
is a great retirement source of income for us, or
just the opposite. Man, We were really close, but the
old adage, you know, bloodsticker than water, and I can't
stand my siblings now because of this whole estate mess.
Speaker 2 (32:44):
So therefore get rid of it all right.
Speaker 1 (32:46):
So there's a lot of scenarios, But again I think
Corey gaves some great advice. Look at your situation first.
Then you got to come to an agreement as a group.
And if you can't, especially if there's only three of you, right,
can I have a majority or you can't have a majority.
But if there's two of you, can't have them majority there,
or if there's one of you you can always, you know,
end up hiring an arbitrator or an attorney or somebody
to kind of play that mediator role and go go
(33:08):
through the pluses and the minuses of selling it, et cetera.
Speaker 2 (33:11):
What about running it out, Corey, Obviously an option.
Speaker 3 (33:14):
It's always an option.
Speaker 6 (33:15):
With that one, I would definitely talk to a CPA,
get the text issues, Understand what it would be if
you sold it today, Understand what it would be if
you decide to keep it long term, and what it
might look like down the road. But again, if you
don't need the money, if the other beneficiaries are an agreement,
or if you're the single beneficiary, Yeah, it's if it
created a nice base for mom and dad, So there's
(33:37):
no reason it can't create a nice space for you.
Speaker 1 (33:39):
Absolutely. Okay, we're going to wrap it up with a conclusion.
We're gonna call this a state planning lessons. Here's what
we're going to advise on.
Speaker 2 (33:48):
Number one.
Speaker 1 (33:48):
In most cases, always consult to a legal professional. Probably
put the home in a revocable living trust to avoid
the probate. Put the estate obviously in the living trust
to avoid probate. Right, that is your number one issue.
The probate side of things, etc. Plus no specific instructions.
So please please please parents, grandparents. If you're going to
be letting your kids inherit your estate, it all starts
(34:11):
with the living trust. Number two, make your intentions very
very clear. Don't crowd it, don't make it all fancy.
Let the kids fight over what you or don't let
the kids fight over what you could have settled, meaning
having a clearly defined trust, saying this is like Corey's
referred to, these are my intentions, this is where I
want the money to go.
Speaker 2 (34:28):
Here's kind of the rules, et cetera.
Speaker 1 (34:30):
And remember, folks, if your property goes to to probate,
you can have a situation where no one can have
access to mom and Dad's bank account. Therefore, how they're
going to pay property taxes, mortgage if they're still a mortgage, etc.
Living trust estate planning absolutely vital. And lastly, keep the
property taxes and the titling strategies up to date. As
Cory said, things are changing all the time. Just make
(34:52):
sure you understand how the property is titled and mom
and dad. Final advice after you have a family meeting,
communicate this to your kids while you are alive. Don't
let it be a big secret where everybody has to
figure out what your intentions were once you're gone.
Speaker 2 (35:03):
Great, wrap it up ten seconds, right.
Speaker 6 (35:05):
I totally agree with all of those things, especially the titling,
and we've warked on it a lot. If you're going
to have a trust, which we highly recommend, set out
what you how you envision this thing happening once you're gone,
and make sure whoever you pick to follow those rules
will follow those rules.
Speaker 1 (35:22):
There you go, There you go. Excellent advice, all right, folks,
So well, hope you enjoy that. Make your estate planning
life a little bit easier through proper estate planning, and
you know, again assemble a great team to do all
this for you, and you know, let the kids benefit
from your years of hard work with your rental properties
and home et cetera. Great job, Grey, We'll do it again,
Tomorro on The John Sanchez Show, Goubless, how about great afternoon.
Speaker 5 (35:42):
DWAIGHTE. Millard n MLS ID number two four one two
five nine a licensed mortgage loan Officer with Highlands Residential
Mortgage Limited and Equal Housing Lender and MLS ID number
one three four eight seven one. The Information shared on
this live broadcast is for general information purposes only and
does not constitute or mortgage advice. Listeners should consult directly
(36:03):
with a license mortgage professional for guidance tailored to their
specific situation. All loans are subject to credit approval and
program guidelines. Not all applicants will qualify. Loan terms in
availability may vary by state and are subject to change
without notice. Highlands Residential Mortgage Limited is licensed in multiple states.
For a full list of state licenses and disclosures, please
(36:23):
visit https slash slash www dot highlandsmortgage dot com backslash
licenses backslash. The views expressed during this program are their
own and do not necessarily reflect those of Highlands Residential
Mortgage Limited.
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