In addition to property management, Nesbitt Realty is a full-service real estate brokerage serving Arlington
After a period of service as a rental unit, landlords may 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 Arlington.
If you decide you would like to sell your rental property, Talk to us and we'll start by preparing a comparative market analysis to help figure out what your property can probably fetch if sold. We'll also prepare estimated proceeds so you know how much you'll really make after 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 Arlington who have owned rental for a longer period of time (more than ten years). Thanks to IRC Section 1031, a properly structured 1031 exchange allows a landlord 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 property owner 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 rental 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 shows, exchanges shelter real estate 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 reveal possibilities that might have otherwise been dismissed.
What is a short-sale?
A short-sale occurs 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 property owner clients have found themselves in an untenable situation with regards to their rental. 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.
But even so, if you need it, members of our staff have CPDE (certified distressed property expert) training. We can go over the ramifications of a short-sale help you decide if that option is right for you and your rental unit.
Should you understand more about this local real estate market?
Nesbitt Realty's Guide to Real Estate is a helpful resource for anyone who hopes to find out more about Arlington and surrounding communities. The Guide to Real Estate includes information about what has sold and what is for sale, as well as many compelling facts that you may not know. Also, our Guide spotlights many of the fundamentals of residing in Arlington. Yes, most of this is helpful for purchasers and sellers, but landlords and tenants will probably also find these tools to be somewhat edifying.
a good reference for landlords in Arlington
- Before you put a renter in your property in Arlington
- Collections and evictions
- Communications with the renter
- During the lease term
- End of lease term and what happens when a renter breaks the lease
- How does the owner get paid?
- How your property manager handles the association and your community
- How your property management company handles utilities
- How Nesbitt Realty & Management finds renters
- Insurance matters for rental investors using our rental management
- How Nesbitt Realty & Management manage keys
- Arlington landlord responsibilities
- Maintenance, repairs & inspections for your rental investment in Arlington
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental investment
- When landlords don't yet know their new address
- Vetting renters in Arlington