A 1031 Exchange is common knowledge for real estate investors and is an easily accessible tool available to anyone who may find themselves landlord by default, through inheritance, divorce or other life circumstance.
Mystery solved.
Does the idea of making changes with your property seem overwhelming? We all have busy lives and It may seem like it wouldn’t be worth the time or effort to rattle the cage.
Find out what's happening in Shoreline-Lake Forest Parkwith free, real-time updates from Patch.
Here is some good news.
1). You can net a significantly higher cash flow from a multi unit property than you can from a single family home.
Find out what's happening in Shoreline-Lake Forest Parkwith free, real-time updates from Patch.
2). It is easier than you think.
3). With today’s interest rates, it is a fantastic time to explore the benefit, particularly in the greater Seattle area.
4). With the right guidance, anyone can do this, not just investors.
When you sit down with your real estate broker, make sure that he or she is experienced in working with 1031 Exchange transactions. In the greater Seattle area, Jeff Snow is that broker. He can run the numbers for you so that all of it is easily undersood and also explain the plan of action.
If you have a single family rental property that has a positive cash flow (or not), you can utilize that property tax free to purchase a duplex, triplex or other multi family building. The idea here isn’t just to postpone taxes, but rather to invest UP and maximize your return. The general rule of thumb is Exchange even or up in value AND Exchange even or up in equity.
Here is our handy mortgage calculator tool link: http://www.jeffsnowgroup.com/#!blank/ctx6
A recent scenario
On February 28th 2014 (last week) in the Ballard area of Seattle, a 4-plex was sold for $519,500.
In a nutshell, if you purchase this property with a 20% down payment ($104k) from funds out of your rental property sale), your monthly payment including taxes and insurance would be $2611. The (monthly) rental income that was shown at the time of sale was $3215
(Please bear in mind that the above is a quick & basic MONTHLY overview without taking into consideration forumula necessary to assess the overall investment, including but not limited to other expenses such as maintenance, vacancy rates etc. that your broker will explain).
For finding information about purchasing or selling real estate in the greater Seattle Area please call jeff Snow at 206-290-8888 or contact us online at the Jeff Snow Group Real Estate Team – Keller Williams Downtown Seattle.