Albuquerque Real Estate Investment Properties
When starting in real estate only 4 years ago I had started out by investing in the Albuquerque
real estate market. Knowing that the area was not only one of the greatest cities in the world but
also knowing the New Mexico real estate market was ready to explode. I have since done very well with
my own investment properties and have helped many others with their own Albuquerque real estate
One thing that many of my clients have been doing in today's investment property transactions is
taking full advantage of the 1031 exchange programs available.
A 1031 exchange, known by many investors as a Starker exchange or a tax-deferred exchange, allows
for real estate investors to sell investment property and to defer capital gains and depreciation
recapture taxes. This assuming reinvestment of 100% of the equity into "like-kind" property is within
a set time frame. Any property held for investment purposes or commercial properties generally
qualifies as "like-kind" property for 1031 exchange purposes.
1031 exchange rules require an investor to identify up to three potential "replacement" investment
properties within 45 days of the close of escrow on their relinquished property. The acquisition of
the replacement investment property (or properties) must be successfully completed within 180 days of
close of the relinquished property.
Having been in the same time sensitive situation on my own investment properties I can help
facilitate the successful completion of your 1031 exchange. Contact me today to complete your 1031
exchange or to start investing in one of the fastest growing real estate markets in the country.
Multiple people on title during an exchange...
Very often real estate investors own income property with friends, family members or business partners. When the parties are ready to sell, problems can arise depending on how title is held. When doing a 1031 Exchange, remember this basic rule of thumb: the entity that sells, needs to be the entity that buys. If, for example, you own a
property with a partner and have created an LLC to take title of the property, the LLC is now the entity doing the exchange. When the new property is acquired in the exchange, the LLC needs to go on title as the owner. Not a problem—unless the individuals within the LLC need to go their seperate ways. If so, the best course of action may be to drop out of the LLC before the sale and for each individual to take title as a Tenant In Common. The sooner that this can be done before the sale the better—and be sure to consult with a tax or legal advisor.
Reverse Exchange? Is it an option?
A Reverse Exchange allows investors to acquire "replacement" property before selling the "relinquished" property. The Reverse Exchange can be a viable option. Please consider the following if contemplating a Reverse Exchange:
- The Reverse Exchange will be more expensive, there are duplicate transfer taxes to be paid and a
more expensive escrow policy will have to be purchased.
- The investor can not own both properties at the same time. To facilitate a Reverse Exchange the
Exchange Company serving as a "straw buyer" will have to go on title to one of the two properties
involved in the exchange. This may be a problem if there is a lender involved in the acquistion.
- The "relinquished property" needs to be sold within 180 days. The 180 day timeline begins when
escrow closes on the new "replacement property".