A few years ago, many people were seeing their real estate investments appreciate at incredible rates, and in turn, were doing 1031 tax-deferred exchanges to defer their capital gains liabilities into new investment properties. But in today’s market, many investors see limited or no appreciation in their investment property. In times like this, does it make sense for an investor to sell their property and do a 1031 exchange?
In many cases, the answer is “yes.”
With almost all real estate sales involving improved property, there is the recapture of depreciation to consider. Section 1250 of the Internal Revenue Code requires that depreciation be recaptured at the current rate of 25%, which is higher than the current long-term capital gains rate. For this reason, the ability to defer the recapture of depreciation may make a 1031 exchange very attractive.
There are even more reasons to consider doing a 1031 tax-deferred exchange in a down market:
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Portfolio diversification (i.e., selling one larger property to acquire numerous smaller properties at today’s prices) or relocating investment properties to another area of the country with faster appreciation,
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Exchange raw land which produces no income for an improved property which can be rented to create positive cash flow,
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Exchange into a property that can be used professionally. For example, selling a single-family rental property and purchasing a new property that can accommodate your business, or
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Exchange from fully depreciated property into to a higher valued property that can be depreciated further.
The value of a 1031 Exchange is considerable, even in today’s market. Leveraging the cash that would otherwise be forfeited in capital gains taxes and/or depreciation recapture makes sense in any market and a 1031 Exchange is the vehicle to get it done.
For specific information about the tax ramifications of a 1031 Exchange, please contact your tax professional. For more information about how a 1031 Exchange can benefit you in various ways contact the author of this article, Carmine DiFulvio, of First American Exchange Company at 800-337-1031.
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Tags: 1031 Exchanges, Carmine DiFulvio, Denver Colorado Real Estate, Investing, Perry & Co, Real Estate
The following quotes have been used in the Perry & Co. Real Estate Professionals Weekly Denver Realtor Sales Meeting Agendas. They are included in the weekly agenda in order to motivate company real estate agents and also illustrate the current economic situation in real estate. They are presented together here in chronological order beginning January 4, 2012.
Click here to see other year’s Motivational Quotes For Realtors.
“What’s gonna work? Team work. What’s gonna work? Team work!” – Wonder Pets
“Success in real estate starts with believing you’re worthy of it.” – Matthew Ferrara
“You cannot live a perfect day without doing something for someone who will never be able to repay you.” – John Wooden, Basketball Coach
“When I thought I couldn’t go on, I forced myself to keep going. My success is based on persistence, not luck.” – Estee Lauder
“Who on earth do you think you are? A superstar? Well, right you are!” – John Lennon, Instant Karma
“Caring, it turns out, is a competitive advantage, and one that takes effort, not money.” – Seth Godin
“To sow your future sales, you must work the harvest in multiple stages: fertilizing, seeding, nurturing and cultivating your future bounty.” – Matthew Ferrara
“If you make a commitment to do what is required to be successful, you will eventually become addicted to the success and then the pain of doing what is required will actually become something you thrive on.” – Tom Tognoli, Intero Real Estate
“If you make a sale, you can make a living. If you make an investment of time and good service in a customer, you can make a fortune.” – Jim Rohn
“Each of us defines for ourselves what it means to be more successful.” – Spencer Johnson, MD
“Relationships trump technology.” – J. Lennox Scott, CEO John L. Scott Real Estate
“Make time for play time.” – Jon Larrance, COO Perry & Co.
“It’s not good enough to have satisfied customers, you must have dazzled customers.” – Dean Lindsay
“Find a mentor and get mentored.” – Mickey Matteson, Worldwide ERC Member
“If we did all the things we are capable of we would astound ourselves.” – Thomas Edison
Click here to see other year’s Motivational Quotes For Realtors.
Filed under: Denver Colorado Real Estate, Information For Realtors, Leading Real Estate Companies | 2 Comments
Tags: Denver Colorado Real Estate, J. Lennox Scott, Jim Rohn, John Lennon, John Wooden, Jon Larrance, Leading Real Estate Companies of the World, Matthew Ferrara, Mickey Matteson, Motivational Quotes For Realtors, Perry & Co, Relocation, Seth Godin, Spencer Johnson, Thomas Edison, Tom Tognoli, Worldwide ERC
Karen Nichols, a 14-year Perry & Co. broker associate likes to prepare her clients in advance of listing their homes about the process they are about to undertake. “It’s an exciting time to be selling your home and considering moving, but it also can be trying – with showings, and feedback on price and often times, waiting for the right buyer.”
Denver’s Perry & Co. Realtors has earned the 2011 Website Quality Certification (WQC), presented February 2012, by Leading Real Estate Companies of the World® to member companies that have demonstrated excellence in website design, functionality and execution.
In 2011, Perry & Co. optimized their website for mobile technologies – smartphones and tablets. The new site, m.perryandco.com allows homebuyers to search for homes for sale near their current location, connect with company Realtors via social networking, and locate nearby businesses and services via Yelp integration. Currently the mobile site works on all iPad, iPhone, Android and Blackberry platforms.
David Browning, Broker Associate at Perry & Co. Real Estate Professionals recently joined the 2012 Mayor’s Housing Plan Task Force as a representative from the Denver Metro Association of Realtors in order to assist with the development of a new housing strategy for the City & County of Denver. The bi-weekly task force has already started to meet with the goal of presenting policy recommendations to Mayor Michael Hancock in June 2012. The 17-member board’s recommendations for housing policy must integrate with other related city strategies such as Blueprint Denver, Greenprint Denver and the Strategic Transportation Plan. In addition to Dave’s Task Force duties, he currently serves as a
It wasn’t that long ago that Dave was sitting in the New Member Orientation, as he’s only been a Realtor since 2005. However, in the past seven years as a Perry & Co. Broker Associate, Dave has continued to grow his business, exceeding his sales goals year over year. He earned the DMAR (formerly the Denver Board of Realtors) Rookie of the Year Award in 2006, and has earned Perry & Co.’s Award for Highest Number of Transactions for three years in a row. He’s revered by his fellow Realtors for his generosity of time, neighborhood expertise, sense of humor and is revered by his clients for his extraordinary customer service and attention to detail.
The following 
Denver, Colorado has more land area devoted to parks than any other major city – and Washington Park, Wash Park to us, is the jewel in our crown. Fields for team sports, courts for tennis teams, lakes for birds and miniature boats, top-of-the-line play equipment for the toddler-set, a walking/cycling loop, historic gardens – even a croquet lawn! And, surrounding this 165 acre green space are the homes and neighborhoods that make up one of Denver’s most vibrant urban centers.
Wash Park – Located between University and Virginia, Alameda and Louisiana, this area on the East side of Washington Park has beautiful older homes, many classic Denver squares and some Victorian beauties, too. The lots are large with well-maintained homes and landscaped yards. Within walking distance to the park, many of these homes have been remodeled, “popped” and given a second floor, and/or torn down and rebuilt. The lifestyle is “walking” – the dog, with the kids, to the ice-cream shop or for a cup of Joe. Everybody uses the park – and neighbors count on seeing each other rounding the loop, with the kids on the slide or throwing bread crumbs to the ducks.
known for its winding, curvy streets and charming, well-cared for homes in a variety of styles – Denver Squares and bungalows sit next to Georgian brick homes with shuttered windows nestled next to contemporary ranches with glass blocks. It’s a walking neighborhood with a quaint park in the center where neighbors gather on summer evenings. On the University side of the neighborhood is a Denver landmark, the Bonnie Brae Tavern – known city-wide for its fantastic pizza. And, the Eugene Field Library is a family favorite for all who live here.
Denver, Colorado Realtor Claire Averill of Perry & Co. was awarded the esteemed
The CIPS Designation is awarded by the National Association of REALTORS, the world’s largest trade association representing over 1,000,000 REALTORS in the United States.


