1031 exchange of greater value into multifamily

[Tammy Skeath]

Hello BP members,

We are in the middle of a 1031 exchange. We sold a property in FL for 440k. What we have in the exchange after escrow is 379k.

We are looking at a multifamily property in another state for 1.6 million. My question is will we run into any issues since the exchange is so much greater than the initial sale? We will use the exchange amount for the deposit and then add any additional funds to get the full down payment for the financing. I thought I had heard somewhere the exchange property couldn’t be more than 1.5x the value of the first property. If so, what happens if it is greater? I’m in the 45 day window for the exchange currently. Thanks for your help!!!

[Greg Dickerson]

@Tammy Skeath there is not cap on the value of the exchange property that I am aware of. Just greater than the one you are selling. There is a cap on exchanging into multiple properties but not on just one. Best to ask an accountant.