Investing in Real Estate through 1031 Exchange
Keeping Your Real Estate Equity In Tact During a Sale With 1031 Exchanges presents a wide variety of opportunities from taking advantage of the 1031 exchange technique provided by the real estate code.
In a 1031 tax free exchange a real estate investor can sell an appreciated property and invest the sale proceeds in a like kind property. By investing the real estate profits in a new property purchase, the taxes on the gain are deferred. A financial institution that is knowledgeable in 131 tax free exchanges should handle the transaction to make certain that all regulations are complied with. This is a valuable tool for the preservation of cash and equity in the appreciated real estate.
Real estate investors will find oceanfront condos, downtown lofts, apartment projects, apartment conversion candidates and office buildings, all worthy of considering for the reinvestment of 1031 proceeds.
Condos provide supply and demand upsides and a wide variety of potential future buyers including homeowners, vacation homeowners and investors.
Downtown lofts offer unique loft designs, proximity to downtown business districts and lively downtown neighborhoods.
Apartment buildings and offices, particularly in high demand areas like historic districts, present the opportunity for positive cash flow and future equity appreciation.
When zoned CRO, which allows a building to be used for residential, commercial or office purposes, apartment building have the additional value of being able to be converted to offices. Small apartment buildings zoned CRO in historic neighborhoods are prime candidates and highly sought after by real estate investors looking for 1031 exchanges.
A 1031 exchange can save a real estate investor a great deal of cash.