Re-Evaluate Your Investment Property

What? Am I finally reversing course and throwing in the towel on investment real estate?

You know me better than that.

Actually, I'm a firm believer in the short- and long-term prospects of real property investments. True, we're going through a soft spot now, but really, I believe we're OK.

So why the dire headline? Should you pitch your properties out the window and head for cover? That's not what I'm saying at all.

If you really think like an investor, conscious of investment returns and fully realized tax deductions, take note. It might be time to sell.

I know it may seem counterintuitive in a soft market.

But soft markets are a good time to pick up other investments at attractive prices. And the 1031 exchange really makes it possible.

Here's how it works. Unlike most investments, where unlocking profits triggers capital gains taxes, real estate investments enjoy a special tax umbrella.

You can reposition your portfolio without taking a tax hit. You can sell appreciated property and reinvest into others without paying a dime in taxes. That's huge. Wouldn't you love it if this worked for other investments? But it doesn't.

Click here for the video version of this story from Jennifer Openshaw.

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