In addition to property management, Nesbitt Realty is a full-service real estate brokerage serving Rappahannock County
After a period of service as a rental property, landlords can decide to sell their property. Nesbitt Realty is a full service brokerage and we have successfully and quickly sold many rental properties at best market value for our former landlord clients in Rappahannock County.
If you decide you would like to sell your rental, Get in touch with us and we'll start by preparing a comparative market analysis to help determine what your rental unit will likely fetch if sold. We'll also prepare estimated proceeds so you know 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 landlords in Rappahannock County that have held rental property 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 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 property owner 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 shelter rental 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 important 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 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 landlord 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 go over the ramifications of a short-sale help you decide if that choice is best for you and your rental property.
Do you need understand more about the community?
Nesbitt Realty's Guide to Real Estate is a handy resource for everyone who wants to learn more about Rappahannock County and surrounding communities. The Guide to Real Estate provides information about what has sold and what is currently listed, as well as some shocking facts that you may not be aware of. Also, our Guide features some benefits of residing in Rappahannock County. Definitely, all of this is interesting for buyers and sellers, but real estate investors and tenants should also find this information to be quite useful.
a free archive for rental investors in Rappahannock County
- Before you move a tenant into your investment in Rappahannock County
- 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 landlord get paid?
- How your managment company handles the association and your community
- How your property manager handles utilities
- How Nesbitt Realty & Management finds tenants
- Insurance matters for owners using our property management
- How Nesbitt Realty & Management manage keys
- Rappahannock County landlord responsibilities
- Maintenance, repairs & inspections for your rental property in Rappahannock County
- The move-in inspection
- Property management information form
- Selling a 1031 tax exchange & more
- Starting our management of your rental investment
- When landlords don't yet know their new address
- Vetting renters in Rappahannock County