1031 Exchange: Everything You Need to Know

1031 exchange

Did you know that 90% of the world’s millionaires became wealthy due to real estate? Whether you’re currently using the 1031 exchange or not, participation has various benefits. 

You might wonder what those benefits are and how lucrative they are for those in real estate investing. While it might feel like a challenge to figure out if it’s right for you, it doesn’t have to be! Read this guide on everything you need to know about the 1031 exchange today. 

What Is the 1031 Exchange?

The 1031 exchange allows you to buy and sell real estate without paying capital gains taxes. Sell real estate and buy another similar investment without paying taxes on the profits from the sale. The 1031 exchange has allowed tax attorneys and investors to see if they’ll qualify for various properties. 

A 1031 Exchange Guide

To sell a property and use the exchange, you’ll need to have a qualified intermediary, such as an entity, company, or person. The intermediary will receive the proceeds of the sale from the first property. 

Hot markets can make timelines difficult. However, you can do another 1031 exchange once you sell the property. 

There’s no limit to the number of exchanges you can do when you sell and buy real estate. Your heirs can sell the real estate and keep the cash without large tax consequences. You need to designate the replacement property within 45 days and close escrow within 180 days of selling the first property. 

Is the 1031 Exchange Worth It?

Since there are many requirements, it’s not as flexible as the traditional buying and selling process. So first, think about the type of property that’ll work with the exchange. 

Next, choose the qualified intermediary. The only time it isn’t required is when the properties are bought and sold on the same day. Doing this can be risky and rare, especially if you don’t have experience with it. 

Contact the IRS

Once the process is complete, it’s time to contact the IRS. You can file Form 8824 with your taxes for when the exchange occurs. 

Speak with your tax advisor to ensure it’s filled out correctly. If the IRS doesn’t think you filled it out correctly, you could need to pay a large tax penalty. 

Ensure that each property is similar to avoid extra penalties. For example, if you buy a property of a lesser value, the reduced debt is taxable. 

Structured Transactions 

There are a few different ways to structure the transactions. First, there’s the delayed build-to-suit exchange, where the proceeds to finance the new property meet the needs of the investor. 

The delayed reverse exchange is when the replacement property is bought before you sell the original. A simultaneous exchange is when both transactions occur at the same time. A delayed exchange is when one property is being sold while the other is bought within 180 days. 

A Guide to the 1031 Exchange

This 1031 exchange guide provides an explanation of what it is. It also shows how beneficial it is. 

Are you ready to buy or sell property? We can help! Contact us today to get started with finding top-notch real estate agents. 

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4 Trends in Real Estate You Need to Know

trends in real estate

Statistics show a decline in home ownership, with 36% of Americans renting instead. It’s also shown that 65% of these renters are young adults. If you are new to property management, you may be interested in trends in real estate. Trends are important because it predicts what people will be looking for.

Part of being a successful property manager is staying ahead of trends. This helps you to predict what tenants will want and what will do well on the market.

Keep reading to find out more about the trends in real estate right now.

1. Digital House Hunting

The most obvious real estate market trend is digital househunting. In the last five years, many house hunters have started to rely completely on technology.

There are so many real estate resources online that this is inevitable. It took off even more in 2020 when people were unable to visit houses in person.

This is why property management needs to focus on online presence. How your rental properties are displayed online will have a huge impact on tenants.

You may want to invest in better photography and better property listings.

2. Single-Family Housing Demands

The market also shows that the demand for single-family housing is very high. Both single-family housing and multifamily units are creating shortages.

These options are being snapped up within a very short amount of time. This is making them much harder to find and even more in demand from the shortage.

3. Prices Are Rising

Trends in real estate are also predicting that prices will continue to rise as they have been doing. Home prices have continued to go up and are expected to continue throughout 2023.

Shortly after 2020, housing prices dropped for a short amount of time. That quickly changed, however, and prices have continued to escalate over the past few years.

Despite the rising prices, this has not dissuaded any tenants over the past few years. Houses are still in high demand, and people are willing to pay the necessary prices.

4. Better Tenant Focus

One trend in rental properties is more focus on the tenants. Property managers are starting to focus on advertising and better screening.

Some are also expanding their options to create a more enjoyable tenant experience. Focusing on your tenants is a great way to ensure that everyone stays happy.

Trends in Real Estate to Know About

If you are a new property manager, you may be curious about trends in real estate. It is important to follow trends since this can predict your success in this career path.

Like any industry, the real estate market is always changing year to year. You have to stay on top of these trends to better understand what tenants are looking for in properties.

Are you interested in finding the best real estate agent for your properties? Contact us today at eFind Agent for the best housing resources available.

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5 Benefits of Professional Real Estate Photography

Real Estate Photography

Can you believe that the global real estate industry is worth over $3.8 trillion?

Owning property is one of the wisest things you can do for your finances. Once you’re ready to sell your property, you can hope to pocket a massive profit. Even though real estate is a safe investment, there are some mistakes you could make that lower the value of your property.

Have you ever wondered if it’s worth investing in professional real estate photography? Continue reading this article to break down the top five benefits you can enjoy when you hire a professional photographer.

1. Your Online Listing Will Pop

If you visit any of the most popular real estate listing websites, you’ll notice that there are hundreds of available homes in your area. You’ll need to make sure that your home stands apart from the other online listings or else it’ll stay on the market for a long time.

As people scroll through all of the options out there, they’ll feel compelled to stop and take a closer look at your post.

2. A Real Estate Photographer Finds the Best Angles and Light

Even a gorgeous mansion won’t seem as impressive if it’s shot on a low-quality camera in bad lighting. Professional real estate photographers have access to the finest tools, and they have the experience to capture your property in the most flattering ways possible.

If you try to snap these photos yourself, then you’ll have a hard time showcasing your home’s nicest features.

3. Your Home Will Sell Much Faster

There’s nothing more frustrating than playing the waiting game when you’re ready to cash out and move on to a new chapter in life. Buyers who don’t have access to enticing property photos won’t invest more time and energy in house tours or making offers.

If you don’t want to wait for months to sell your home, then you can do yourself a huge favor by hiring a professional photographer.

4. Great Photography Skills Make Your Property Seem More Valuable

When people are in a good mood, they’re more open-minded about spending money. Presenting your home on a silver platter will allow you to ask for a higher price and negotiate the best deal possible.

Buyers will see the potential in your home.

5. Only Interested Buyers Will Tour Your Home

A talented real estate photographer will make viewers feel like they’re already inside the home. Since they’re able to form a reliable first impression, they can decide if they want to tour the home in person.

This can save you lots of effort since you’ll only need to accommodate people who are extremely interested in buying your home.

It’s Always Worth Investing in Professional Real Estate Photography

As you can see, professional real estate photography is a real game changer. You won’t regret investing once you reap these benefits.

Selling property doesn’t need to be tough. Contact us to learn more about our incredible services.

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7 Things Every New Property Manager Should Know

property manager

Did you know that the average sale price of a home in the United States was approximately $500,000 during the first quarter of 2022? This doesn’t have to be a negative thing, though. Many people have found rising home prices to be great investment opportunities. Looking to get into property management? If so, here are seven important things you should know before getting started as a property manager.

1. Understand Local Landlord-Tenant Laws

It’s essential for property managers to understand the laws in their state or municipality regarding tenant rights and responsibilities, fair housing regulations, security deposits, rent increases, and evictions.

Thoroughly understanding these laws can save you time, money, and legal headaches down the road. So, don’t overlook this.

2. Get to Know the Fair Housing Act

The Fair Housing Act prohibits discrimination against tenants based on race, color, national origin, religion, sex, familial status (including children under 18), and disability.

It’s critical for those who own a rental property to understand and abide by the regulations set forth in this important federal law. Failure to do so comes with a large number of consequences, such as legal complications.

3. Be Familiar With Tenant Screening Protocols

Property managers need to be aware of how to properly screen tenants, including running background checks, checking references, and verifying employment status.

The screening process should adhere to local laws regarding applicable fees, criteria, and guidelines. This will allow you to avoid renting to dangerous individuals. The same can be said about renting to those who are not likely to pay rent on time.

4. Know How to Handle Maintenance Requests

Property managers need to be able to respond promptly and effectively to tenant maintenance requests. They should also have a plan in place for handling emergency repairs after hours.

If you are negligent when it comes to this responsibility, your tenants may even take legal action.

5. Stay Organized With the Right Software

From tracking tenant payments to scheduling regular inspections and generating reports, property managers need to stay organized in order to ensure the smooth running of their business.

Utilizing the right software can help make this process much easier and more efficient. This efficiency can go a long way toward minimizing stress.

6. Work With a Professional

It’s always a good idea to work with a professional who has experience and expertise in property management.

A knowledgeable advisor can help you understand the legal nuances of being a landlord, as well as provide valuable guidance on setting up your business for success.

It’s also worth noting you should always work with a professional when looking to find the home right for you.

7. Have a Contingency Plan

No matter how well you plan, unexpected problems and issues can arise. Have a contingency plan in place to help manage potential risks, such as tenant default or damage to the property.

It’s also important to have an emergency fund set aside for any unexpected expenses. Otherwise, you may find yourself unable to handle problems that arise.

Becoming a Property Manager Doesn’t Have to Be Overwhelming

Initially, deciding to become a property manager may seem daunting. The good news is that the guide above has everything you need to know to make the process simple.

Looking for more information about what we can do? Reach out to us today to see how we can help.

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4 Things You Should Know About Investing in Real Estate

Investing in Real Estate

Rental property owners often manage their properties. In fact, 42.3% of rental property owners manage their properties themselves. The rest hire property management firms. The nice part is you have the option of doing it yourself or hiring it out. However, there are other ways to invest in real estate besides owning rental properties. Therefore, investing in real estate also has options.

You should learn about these options if you’re considering investing in real estate.

So keep reading to learn four vital things about real estate investing.

1. Rental Properties Offer Long-Term Revenues

Investing in rental properties is the most common form of real estate investing. It’s also a smart way to invest your money, and you can reap benefits from it.

You’ll be responsible for finding and managing tenants when investing in rental properties. Additionally, you’ll have to handle the maintenance and repairs.

The benefit is that your tenants pay rent, and the rent money should cover all your expenses. So you’ll earn a big profit when you pay off your property mortgages.

You’ll also have tangible assets to sell if you no longer want to be a landlord. 

2. Flipping Properties Offer Fast Profits

An alternative to purchasing rental properties is flipping real estate. Flipping is a process that involves the following steps:

  • Purchase a property that needs some work
  • Perform the work it needs
  • Sell for a profit

The goal is to complete the steps quickly and turn a profit. Then, you can use this money to invest in more real estate projects. 

Choosing the right properties is a vital step in successful home flips. 

3. Location Is Critical

A property’s location is critical regardless of how you plan to make money from it.

For example, if you want to flip a home, you must choose a house in a favorable location. If you don’t, no one will buy the house, causing you to lose money.

The same is true for a property investment you rent to tenants. You’ll find higher-quality tenants in safe communities. As a result, you’ll generate more rental income from properties in great locations. 

4. Property Management Services Are Vital

Every rental property owner should consider hiring a property management company for assistance. 

First, managing rental properties is time-consuming. If you don’t have enough time to manage the properties, you might skip duties. Skipping duties leads to problems with the properties.

Secondly, when you invest in real estate, you’ll need to know how to manage the properties. Property managers do this for a living. They know the ins and outs of the business, which can help you have a more successful company.

Keep These Facts in Mind When Investing in Real Estate 

Are you interested in investing in real estate? Real estate investments offer many perks and benefits, but managing properties is a tough job. As a result, you should consider hiring a property manager for help.

Contact us if you have questions or would like more information about our property management services. 

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