Troy Hansford for Denver Real Estate | 303-617-0607 |

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What is a Self-Directed Account for Real Estate?


We’ve always heard that you can’t use an IRA or a 401K to invest in real estate, but are these claims really true? Today we have Josh here to answer a few questions for us.A self-directed retirement account is a different type of account that allows you to purchase real estate within the account. In traditional accounts you can purchase stocks and bonds, but within a self-directed account it’s still within your retirement account and you’re able to purchase other types of assets like real estate.

One of the reasons you might choose to use one of these accounts is to avoid the market volatility on Wall Street. Another reason to use an account like this would be to diversify your portfolio so when one market goes down, you’re not completely in the red.

Some restrictions the IRS might have on these accounts are that your real estate purchases must be for an investment, not for personal reasons like housing yourself or family members. You also can’t buy property to or from yourself, and you can’t lease the property to family. The IRS puts these rules in place to prevent any conflicts of interest.

Overall, a self-directed retirement account is a great way to diversify your portfolio if you’re concerned about upheaval in the stock market.

Please be sure to reach out to us if you have any questions or concerns about this issue, or if you have any questions about the Denver real estate market.