A Doctor's Journey to Financial Freedom Through Real Estate

Nicole Shirvani, a dedicated psychiatrist, has found a lucrative side avenue in real estate investing. In her early 20s, she began her investment journey by purchasing a condo in Toronto, where she lived. Initially renting it out to long-term tenants, she stepped back to concentrate on her medical studies.

"During my student years, my income was limited, so I shelved my real estate plans," she shared with Business Insider. "However, after completing my medical training, I started earning well, which prompted me to think about investing in assets that could grow in value and bolster my future savings."

Investing in Property for Growth and Savings

Real estate proved to be a dual-benefit venture, offering both consistent revenue and rising value over time. Shirvani shifted her focus to southern Oregon's property market post-graduation, where she secured a duplex near her workplace in 2018.

One half of this duplex was already leased out to a traveling nurse at the time, while the other half was vacant. She devoted about six weeks to refurbishing the empty unit and soon secured a new tenant. This resulted in a cash-on-cash return that ranged between 15% and 20%.

Leveraging a 1031 Exchange for Tax Efficiency and Portfolio Expansion

In 2022, Shirvani took a new opportunity in Florida and chose to sell her Oregon duplex. Selling an investment property typically incurs taxes on the profit, categorized as short-term (if held under a year) or long-term capital gains tax (if held over a year).

To sidestep these taxes, she utilized a 1031 exchange, a method allowing investors to defer taxes by reinvesting sales proceeds into a 'like-kind' property of equal or greater value.

This exchange is strictly for investment properties, requiring a third-party intermediary, and must adhere to a strict timeline. Investors must identify potential replacement properties within 45 days and finalize the exchange within 180 days of selling the original property.

Shirvani effectively swapped her Oregon duplex for two properties in Florida, scoring a beachside condo and a single-family residence. She remarked on the tight, but manageable timetable, noting the bustling market.

Proactively identifying potential new properties prior to selling her existing one helped alleviate some pressure. She advises future investors to have alternative properties lined up before selling to avoid a scenario where they can’t reinvest quickly.

Her real estate portfolio has since grown to include short-term rentals in Virginia's Shenandoah Valley and a multi-unit property in Florida's Lakeland, using the same strategic framework.

Building for the Future While Enjoying the Present

Although Shirvani is not planning an early retirement, the supplementary income from her properties is enhancing her savings nest and enabling her to reduce professional commitments progressively. It also allows her to allocate funds toward future expenditures.

"This investment approach has significantly increased my savings, afforded me travel opportunities, and contributed to my daughter's financial security," she stated. "Eventually, I aim to pass on these assets to her."