Invest in a Vacation Home with a 1031 Exchange

Investing in a Vacation Home – It’s Smarter Than You Think
When you hear that both vacation- and investment-homes sales set records in 2005, you know it’s got to be a smart financial decision. In fact, The Business Journal of Milwaukee’s Erik Brooks says “second home sales (are) a hot investment strategy.”

So how does owning a vacation home make it a wise financial move?
By paying for itself! During the off-season (anytime you aren’t using it yourself) you can rent it out. And, as we all know, real estate is generally a good investment. In fact, real estate experts from the National Association of REALTORS® predict that second homes will continue to appreciate in value. If you decide to sell later on, you will likely sell at a profit. This is a great way to diversity your investment portfolio.

Waterfront and beach homes are hot investments
Buying a home in such hot real estate markets and desirable locations as waterfront properties and beach homes is an especially smart decision because activities of interest often affect the decision of where to purchase a particular vacation home. One of the top locations includes waterfront properties.

When considering a wise investment such as a vacation home, you can’t go wrong with the properties at Lake Hartwell. To speak with the real estate expert in this area, call me. I will do whatever it takes to find you a vacation home in one of the beautiful, preeminent communities in this area. You’ll find out just what a smart investment your vacation home will be. Best of all, you get the best of both worlds – a vacation home that pays for itself!

Maximize Your Wealth with a 1031 Exchange
A Tax-Deferred Exchange (commonly called a 1031 Exchange for the IRS section it refers to) allows you to sell investment property and buy new property with the profit from the sale and not owe taxes on it right away. This can be an excellent way to diversify your financial portfolio and maximize your wealth. It is important to note that the intent for the property must not be for resale but to hold the replacement property as an investment or for productive use in trade or business. The exchange structures include simultaneous, delayed, build-to-suit, reverse and reverse build-to-suit.

A profitable strategy
A great strategy for optimizing your 1031 Exchange is to purchase a rental home below market value, rent it for a year, sell it then buy two rental properties with the gain. However, the property you are going to purchase must be “identified” and closed within a certain amount of time. To “identify” a property, you must deliver a signed document to the person assisting you – who cannot be related to you – on or before 45 days from the date you sold the original rental property (including weekends and holidays).

Tell me more about property identification
You can identify more than one property as a replacement property so long as the total value doesn’t exceed 200% of the original ...

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