In addition to property management, Nesbitt Realty is a full-service real estate brokerage serving Highland_park
After a period of owning a rental, landlords often decide to sell their rental. Nesbitt Realty is a full service brokerage and we have successfully and quickly sold many rentals at best market value for our former property management clients in Highland_park.
If you decide you would like to sell your rental property, Talk to us and we'll begin by preparing a comparative market analysis to help determine what your rental can likely fetch if sold. We'll also prepare estimated proceeds so you understand 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 real estate investors in Highland_park who have owned rental unit 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 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 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 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 crucial 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 overlooked.
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 investor 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 a concern lately.
However, if you need it, members of our staff have CPDE (certified distressed property expert) training. We can explain to you the consequences of a short-sale help you decide if that option is right for you and your rental property.
Should you understand more about the community?
Nesbitt Realty's Guide to Real Estate is a helpful tool for anyone who needs to learn more about Highland_park and surrounding communities. The Guide to Real Estate compiles facts regarding what has sold and what is on the market, as well as some surprising facts that you might not be aware of. Not to mention, our Guide highlights quite a few of the assets of living in Highland_park. As a matter of course, all of this is interesting for buyers and sellers, but property owners and renters will likely also find these tools to be very eye-opening.
Landlord Reference
a handy reference for rental investors in Highland_park
- Before you put a renter in your rental in Highland_park
- Collections and evictions
- Communications with the renter
- During tenancy
- End of lease term and what happens when a renter breaks the lease
- How does the property owner get paid?
- How your property manager handles the association and your community
- How your property manager handles utilities
- How Nesbitt Realty & Management finds tenants
- Insurance matters for landlords using our property management
- How Nesbitt Realty & Management manage keys
- Highland_park owner responsibilities
- Maintenance, repairs & inspections for your property in Highland_park
- 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 Highland_park