Self Directed IRA for Real Estate investment

[Mike999]

I'm 7 years into retirement, 57 years old and I have quite a bit of money in various IRA with my wife. We are thinking about buying a property next door to our lakehouse and renting it out. I understand that it needs to be very separate from personal benefit to qualify, we would have to keep an arms length from the day to day operation etc, but I'd rather see it as a long term rental than an air BNB or a new overbuilt mega mansion next door. I'm OK if the returns are less that way. It would require about 15% of our IRAs (10% of net worth) and would just be good for us to know our kids would have the option to have the property in another 10 or 20 years. I don't think we would ever need this money, we probably worked too long....

So, the questions:
Any recommendation on a company to manage the Self Dir IRA? Just wondering who are the vanguard and fidelities of this space? Anyone with good or bad experience with Self Directed in real estate? How would it work if we want to sell the property to a family member or ourselves in another 5 or 10 years?

 

[OldShooter]

Your first problem is to find a custodian who will hold the "unusual asset" at an acceptable cost. Then find a company to actually manage the asset. Not easy IMO.

 

[pb4uski]

Do you have enough taxable account money for the down payment and 2 1/2 years of operations if it doesn't cash flow (rent income exceed mortgage and expenses)? If so, then buy it outside the IRA and when you turn 59 1/3 use IRA withdrawals to cover the cost if it doesn't cash flow.