In addition to property management, Nesbitt Realty is a full-service real estate brokerage serving Page County
After a period of owning a rental, rental investors may decide 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 Page County.
If you decide you would like to sell your rental, Talk to us and we'll begin by preparing a comparative market analysis to help figure out what your rental will likely 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 rental investors in Page County 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 property owner to sell a property, to reinvest the proceeds in a new rental 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 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 comprehensive knowledge of the exchange process and the IRC. For instance, an accurate understanding of the key term “like-kind” can reveal opportunities that might have otherwise been dismissed.
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 property owner clients have found themselves in an untenable situation with regards to their 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.
However, 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.
Do you want know more about this area?
Nesbitt Realty's Guide to Real Estate is a helpful resource for anyone who wants to find out more about Page County and surrounding areas. The Guide to Real Estate includes facts regarding what has sold and what is currently listed, as well as some shocking facts that you may not be aware of. And, our Guide features many of the assets of residing in Page County. As a matter of course, all of this is helpful for purchasers and sellers, but landlords and tenants will probably also find this information to be very useful.
a free archive for rental investors in Page County
- Before you move a tenant into your rental in Page County
- Collections and evictions
- Communications with the tenant
- During the lease term
- 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 finds tenants
- Insurance matters for rental investors using our property management
- How Nesbitt Realty & Management manage keys
- Page County property owner responsibilities
- Maintenance, repairs & inspections for your rental investment in Page County
- 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 Page County