1031 exchange from three unit to 14 unit property
Investment Info:
Large multi-family (5+ units) private money loan investment.
Purchase price: $1,200,000
Cash invested: $550,000
1031 exchange from three unit to 14 unit property
What made you interested in investing in this type of deal?
Deferred maintenance and poor management
How did you find this deal and how did you negotiate it?
Loopnet
How did you finance this deal?
cash from 1031 and owner carry back
How did you add value to the deal?
$250,000 of upgrades and remodeling
What was the outcome?
Increased the income in 18 months from $6500 to $16,000 per month
Lessons learned? Challenges?
make sure to get permits for everything
Most Popular Reply
- Qualified Intermediary for 1031 Exchanges
- St. Petersburg, FL
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@Rennie Gabriel - food for thought - We refer to the exit strategy of the 4 Ds - Defer, Defer, Defer, and Die!
As long as you hold that property you'll never pay the tax. As long as anytime you sell the property you do another 1031 exchange (into a passive opportunity if it's years down the road, or a vacation rental, or more or less units - whatever) you'll never pay the tax.
And when you die your heirs get it at what is called a "stepped up basis". The tax disappears for them. What a legacy to leave. The only unfortunate part is what has to happen to you first :)
- Dave Foster
