All Forum Posts by: Scott McGadden

Quote from @Dave Foster:

@Scott McGadden. I think a 1031 exchange wouldn't be a bad idea if you're not making much on the property, and are worried about big repairs coming up in the near future. 

The 1031 exchange would allow you to indefinitely defer all of the capital gains taxes and use it to purchase multiple newer properties with lower capital expenditures, in a better market. Or even purchase something larger such as multi-family or commercial that provides better cash flow. 

If you're not exactly excited about jumping back into the market, there Are passive investments that are eligible for 1031 exchange as well. You would continue to defer all of the tax and receive potential cash flow until the market becomes more attractive for you. 

Hey Dave, since I have mortgages on these properties, would it make sense to bring cash to the exchange to cover the mortgage amount (or pay off the mortgage before doing the 1031) and improve the cash flow for the newly acquired property? But then again, is there a better use for my cash?  

Thank you.

Hi Chris, I would appreciate more information about the local lender you used for a HELOC in Texas. Thanks.

Quote from @Aaron Gordy:

The new property tax law should help significantly. Also one can protest their property taxes fairly easily. There are local firms that will do it for you with the cost of about 1/3 the tax savings. Cash out refi is a very good strategy. 1031 is also good. 

 Hi Aaron, I use a property tax protest service currently. What is the new property tax law that you mentioned?  Thanks. 

Thanks everyone for your comments and suggestions. I'm thinking more about doing a 1031. Does anyone have any suggestions for areas with newer SF homes offering decent cash flow to review?  

I'm looking for options for possible next moves for one or all three of our single-family rental properties in the Austin and San Antonio areas. They have low 20% ltvs and have market values in the ~350k. A local Property manager manages them. We've owned them for 20-plus years but the recent property tax increases have negatively impacted our cash flow as have major repairs such as roof replacements, AC units, etc. We're looking for possible next moves including doing a 1031 to a lower prop tax state into a couple of newer SF units or possibly a multi-family opportunity. Or cashing out and parking the money for a while. Unfortunately, we live in California so we would have to pay significant capital gains if we sell.