Biggest 1031 Misconception - "1031 Buyers Over Pay"

[Mike Auerbach]

Almost everyone within the commercial real estate investing realm shares a common misconception involving 1031 exchanges. Care to take a guess at what it might be?

"1031s cause you to overpay for your properties" or "I love 1031 buyers, they pay they most for properties"

Both are emphatically FALSE.

It is true that some 1031 buyers overpay for their properties because they are unorganized and undisciplined -

BUT 1031s aren't structured in a way that "Makes an Investor Overpay"

Here is our advice to clients so you don't "overpay"

Before the 45 day identification clock even starts you can do the following:

1. Have your broker shortlist 10 properties for you
2. Identify your replacement property or properties
3. Enter into an option contract to buy your replacement property
4. Put your target property or properties under contract (assuming you are not going “hard”)
5. Do a Reverse Exchange

Plan ahead - Plan to win!

#1031exchanges #taxes #capitalgains #planning #myths