In addition to property management, Nesbitt Realty is a full-service real estate brokerage serving Lorcom Grove
After a period of service as a rental unit, rental investors often choose to sell their rental unit. Nesbitt Realty is a full service brokerage and we have successfully and quickly sold many rentals at best market value for our former landlord clients in Lorcom Grove.
If you decide you would like to sell your rental property, Call us and we'll begin by preparing a comparative market analysis to help figure out what your property will probably fetch if sold. We'll also prepare estimated proceeds so you understand how much you'll actually 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 property owners in Lorcom Grove that have owned rental property 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 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 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 critical 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 possibilities that could 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 rental 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 a concern lately.
In contrast, 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 choice is right for you and your rental.
Should you know more about the local real estate market?
Nesbitt Realty's Guide to Real Estate is a handy tool for everyone who needs to find out more about Lorcom Grove and nearby areas. The Guide to Real Estate compiles facts about what has sold and what is currently listed, as well as many surprising facts that you might not be aware of. In addition, our Guide spotlights quite a few of the benefits of residing in Lorcom Grove. Of course, most of this is interesting for purchasers and sellers, but property owners and renters will likely also find this data to be quite useful.
a free reference for rental investors in Lorcom Grove
- Before you put a renter in your property in Lorcom Grove
- Collections and evictions
- Communications with the tenant
- During the lease term
- End of tenancy and what happens when a tenant breaks the lease
- How does the landlord 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 property owners using our rental management
- How Nesbitt Realty & Management manage keys
- Lorcom Grove landlord responsibilities
- Maintenance, repairs & inspections for your rental investment in Lorcom Grove
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your property
- When owners don't yet know their new address
- Vetting tenants in Lorcom Grove