Don’t Sweat the Timing – Income is Key in 1031 Exchanges

Some real estate investors don’t realize that the timing of a 1031 Exchange is often far less important than the actual income benefits. In an exchange, you defer capital gains by acquiring a replacement property – leveraging your full equity into a new investment.

While some fixate on timing the market for appreciation, that’s difficult to predict accurately and reliably. A wiser approach is to increase your income stream as quickly as possible through an exchange.

By acquiring a replacement property with higher rents, you can substantially boost cash flow. That increased income flow, compounding over years of ownership, can far outweigh any theoretical missed appreciation.

For example, if a replacement property generates $40,000 more yearly income, that’s:
– $200,000 in added cumulative income over 5 years
– $400,000 over 10 years

And this doesn’t account for rent increases multiplying the effect over time.

Real estate is a long-term game. Don’t obsess over timing entry/exit for appreciation. Focus on maximizing income through a smart 1031 Exchange – that positive cash flow drives real wealth.

When pondering an exchange, line up replacements delivering optimal income flows. That’s what compounds into life-changing money over years of ownership.

Scott F
SIFF – Strategic Wealth Advisors Specializing in Real Estate Investments.

About SIFF

For over 20 years SIFF Investment Services has provided unbiased, fee-based real estate consulting to disrupt outdated real estate models. We are not realtors or agents. Our role is to educate and empower clients by objectively outlining all options. Our fee-only structure allows us to put client interests first. By taking an unbiased, consultative approach, SIFF aims to help clients prosper through wise real estate investments.

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