In addition to property management, Nesbitt Realty is a full-service real estate brokerage serving Centreville
After a period of service as a property, real estate investors may choose to sell their rental. 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 Centreville.
If you decide you would like to sell your rental unit, Get in touch with us and we'll start by preparing a comparative market analysis to help determine what your rental can probably bring if sold. We'll also prepare estimated proceeds so you understand how much you'll really net at 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 Centreville who have held rental for a longer period of time (more than ten years). Thanks to IRC Section 1031, a properly structured 1031 exchange allows an investor 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 rental 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 shows, 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 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 uncover opportunities 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 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.
Still, 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 this local real estate market?
Nesbitt Realty's Guide to Real Estate is a helpful resource for everyone who wants to investigate real estate facts about Centreville and neighboring communities. The Guide to Real Estate provides data regarding what has sold and what is for sale, and a few interesting facts that you might not be aware of. In addition, our Guide highlights quite a few of the benefits of life in Centreville. Yes, all of this is interesting for buyers and sellers, but rental investors and renters might also find this information to be quite eye-opening.
Landlord Reference
a handy archive for property owners in Centreville
- Before you move a tenant into your investment in Centreville
- Collections and evictions
- Communications with the tenant
- 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 management company handles the association and your community
- How your property manager handles utilities
- How Nesbitt Realty finds renters
- Insurance matters for owners using our rental management
- How Nesbitt Realty & Management manage keys
- Centreville property owner responsibilities
- Maintenance, repairs & inspections for your rental property in Centreville
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental investment
- When property owners don't yet know their new address
- Vetting renters in Centreville