In addition to property management, Nesbitt Realty is a full-service real estate brokerage serving Stanley
After a period of owning a property, 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 Stanley.
If you decide you would like to sell your rental unit, Email us and we'll begin by preparing a comparative market analysis to help predict what your rental unit can probably fetch if sold. We'll also prepare estimated proceeds so you know 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 property owners in Stanley 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 property owner 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 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 crucial 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 reveal opportunities that might 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 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.
But, if you need it, members of our staff have CPDE (certified distressed property expert) training. We can clarify the ramifications of a short-sale help you decide if that option is right for you and your property.
Should you understand more about this area?
Our Guide to Real Estate is a handy resource for anyone who needs to investigate real estate facts about Stanley and neighboring communities. The Guide to Real Estate compiles data about what has sold and what is on the market, and a few compelling facts that you might not know. Furthermore, our Guide features quite a few of the assets of residing in Stanley. Of course, most of this is useful for purchasers and sellers, but rental investors and renters will likely also find this data to be somewhat informative.
a useful source for property owners in Stanley
- Before you rent out your property in Stanley
- Collections and evictions
- Communications with the tenant
- During the lease term
- End of lease term and what happens when a tenant breaks the lease
- How does the owner get paid?
- How your property manager handles the association and your community
- How your rental manager handles utilities
- How Nesbitt Realty finds tenants
- Insurance matters for owners using our property management
- How Nesbitt Realty & Management manage keys
- Stanley owner responsibilities
- Maintenance, repairs & inspections for your property in Stanley
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your property
- When property owners don't yet know their new address
- Vetting renters in Stanley