Finding a great replacement property is often the most difficult part of a 1031 exchange of real estate. In this article, we are going to offer up a few tips for finding your ideal 1031 exchange replacement property.
Look in Different Locales
Many taxpayers starting their first exchange begin their replacement property search in the same general geographic area as their relinquished property. While there’s certainly nothing wrong with that, it is quite limiting. When you are looking for replacement property, expand your search to different cities or even different states. 1031 exchanges can be conducted between US states and locales so there’s no reason to limit your search.
Look in Different Market Sectors
You should also investigate properties in different market sectors. Nearly all investment real estate is considered like-kind to all other investment real estate. That means you can 1031 exchange between property in different industries and market sectors. In fact, this is quite a common practice among taxpayers. If you’re selling a retail property, perhaps you should consider a rental property like a duplex or apartment complex.
Contact a 1031 Intermediary
If you are considering a like-kind exchange for your investment property, the first thing you should do is contact an experienced intermediary who can make sure you are fully prepared before you even begin the process. 1031 exchanges can get complicated quickly, but the qualified intermediaries at CPEC1031, LLC make things as easy as possible for you. We can answer all of your questions, prepare the required documents, and walk you through the 1031 exchange process from start to finish. Contact our team of professionals today to get your exchange off the ground. We are located in Minnesota, but provide 1031 exchange services across the country.
Start Your 1031 Exchange: If you have questions about 1031 exchanges, feel free to call me at 612-643-1031.
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