Quote:
Originally Posted by FlyingScot
Except that if the purchaser is rich enough to buy this, they do not need the cash from the renters. This is very different than the working man who has dreamed of a lake house and stayed up late in his kitchen devising the perfect formula to swing it. So I'm with the folks looking for an ulterior motive
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Lots of people rich enough to buy yachts, but they still put them in the rental fleet.
Lots of people rich enough to buy private jets, but they still put them in the rental fleet.
It has tax advantages and lowers the capital opportunity costs.
Example: The capital opportunity cost could be as much as $5.2 million per year.
So building and only living there part time... that is $5.2 million gone, property tax and upkeep gone, and due to income tax policy... they probably could not deduct the full amounts for that either... so more loss.
Leasing it: some recovery of the $5.2 million, and full deductibility of the property taxes and upkeep as a commercial operation.
The dollar amounts are different, but the concept not.
Does it really matter that someone not born here decides to move or build here and spend $100,000 or $100,000,000? Not to us born here.