In addition to property management, Nesbitt Realty is a full-service real estate brokerage serving Riverwood
After a period of service as a property, landlords often choose to sell their rental unit. Nesbitt Realty is a full service brokerage and we have successfully and quickly sold many rental units at best market value for our former landlord clients in Riverwood.
If you decide you would like to sell your rental, Get in touch with us and we'll start by preparing a comparative market analysis to help figure out what your rental will likely fetch if sold. We'll also prepare estimated proceeds so you understand how much you'll really take away from the settlement.
What is a 1031 Tax Exchange and how can it benefit me?
A 1031 Tax Exchange is usually of greatest benefit to rental investors in Riverwood who have held rental unit for a longer period of time (more than ten years). Thanks to IRC Section 1031, a properly structured 1031 exchange allows a rental investor to sell a property, to reinvest the proceeds in a new rental unit and to defer all capital gain taxes. IRC Section 1031 (a)(1) states:
“No gain or loss shall be recognized on the exchange of property held for productive use in a trade or business or for investment, if such property is exchanged solely for property of like-kind which is to be held either for productive use in a trade or business or for investment.”
To understand the powerful protection a 1031 exchange offers, consider the following examples:
- A landlord has a $100,000 capital gain and incurs a tax liability of approximately $35,000 in combined taxes (depreciation recapture, federal and state capital gain taxes) when the property is sold. Only $65,000 remains to reinvest in another property.
Assuming a 25% down payment and a 75% loan-to-value ratio, the seller would only be able to purchase a $260,000 new property.
- If the same real estate investor chose to exchange, however, he or she would be able to reinvest the entire $100,000 of equity in the purchase of $400,000 in real estate, assuming the same down payment and loan-to-value ratios.
As the above example demonstrates, exchanges protect investors from capital gain taxes as well as facilitating significant portfolio growth and increased return on investment. In order to access the full potential of these benefits, it is important to have a comprehensive knowledge of the exchange process and the IRC. For instance, an accurate understanding of the key term “like-kind” can uncover opportunities that might have otherwise been dismissed.
What is a short-sale?
A short-sale happens when the seller sells a property for less than what is owed on the property. In the past, because of market contractions, some of our investor clients have found themselves in an untenable situation with regards to their rental property. In those cases the best way out was often a short sale. Quite frankly, due to market expansion and inflation, this has not been much of an issue lately.
Nevertheless, if you need it, members of our staff have CPDE (certified distressed property expert) training. We can clarify the ramifications of a short-sale help you decide if that option is best for you and your property.
Do you need understand more about the local real estate market?
Nesbitt Realty's Guide to Real Estate is a free tool for everyone who hopes to find out more about Riverwood and nearby communities. The Guide to Real Estate includes information regarding what has sold and what is on the market, and some compelling facts that you might not know. Also, our Guide highlights quite a few of the fundamentals of residing in Riverwood. Naturally, all of this is helpful for buyers and sellers, but owners and renters will also find these tools to be very eye-opening.
a useful archive for property owners in Riverwood
- Before you rent out your property in Riverwood
- Collections and evictions
- Communications with the renter
- During the lease term
- End of tenancy and what happens when a renter breaks the lease
- How does the property owner get paid?
- How your property management company handles the association and your community
- How your property manager handles utilities
- How Nesbitt Realty & Management finds tenants
- Insurance matters for property owners using our property management
- How Nesbitt Realty & Management manage keys
- Riverwood property owner responsibilities
- Maintenance, repairs & inspections for your rental investment in Riverwood
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental property
- When owners don't yet know their new address
- Vetting tenants in Riverwood