In addition to property management, Nesbitt Realty is a full-service real estate brokerage serving Green Valley
After a period of owning a rental, landlords often decide to sell their rental unit. Nesbitt Realty is a full service brokerage and we have successfully and quickly sold many properties at best market value for our former property management clients in Green Valley.
If you decide you would like to sell your property, Phone us and we'll begin by preparing a comparative market analysis to help determine what your rental property can likely 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 Green Valley that have held rental property for a longer period of time (more than ten years). Thanks to IRC Section 1031, a properly structured 1031 exchange allows a real estate investor to sell a property, to reinvest the proceeds in a new rental property 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 real estate investor 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 protect landlords 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 critical to have a good working knowledge of the exchange process and the IRC. For instance, an accurate understanding of the key term “like-kind” can uncover opportunities that could have otherwise been overlooked.
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 rental investor clients have found themselves in an untenable situation with regards to their rental unit. 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 a concern lately.
But, if you need it, members of our staff have CPDE (certified distressed property expert) training. We can clarify the consequences of a short-sale help you decide if that option is right for you and your rental property.
Should you know more about the area?
Nesbitt Realty's Guide to Real Estate is a free resource for everyone who wants to find out more about Green Valley and surrounding areas. The Guide to Real Estate provides facts about what has sold and what is on the market, as well as some shocking facts that you might not know. In addition, our Guide spotlights quite a few of the fundamentals of living in Green Valley. As a matter of course, all of this is helpful for purchasers and sellers, but owners and tenants will likely also find these tools to be very sobering.
Landlord Reference
a free source for landlords in Green Valley
- Before you rent out your rental in Green Valley
- 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 management company handles utilities
- How Nesbitt finds tenants
- Insurance matters for rental investors using our property management
- How Nesbitt Realty & Management manage keys
- Green Valley owner responsibilities
- Maintenance, repairs & inspections for your rental property in Green Valley
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental
- When property owners don't yet know their new address
- Vetting tenants in Green Valley