Can you buy a Hud property as the replacement property on a 1031 exchange?
Thank you everyone!
@Abad Marroquin , You may buy property from anyone to complete a 1031 exchange. As long as you are purchasing property that you intend to hold for productive use in business, trade or investment as replacement for other investment property the type of property and the seller do not matter.
If you are buying property that a govt. entity owns and is restricting purchase to owner/occupants then no you cannot because you are not buying it to hold for investment. You are affirming that you are buying it as your primary residence.
Thank you for your reply Dave. The agent said it is now open to investors. Has anyone done this in the past? Thank you!
As long as the timeline for your closing on the 1031 and the 30 day closing requirement for a cash Hud purchase coincide ,you should be fine
You will need a proof of funds letter from your facilitator showing sufficient cash available to close
I would also check with the facilitator and the title company you choose and ask if any additional closing documents will need to be signed by HUD and get them approved in advance if necessary .
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