1031 Exchange Trends As We Enter 2025

Now that we made it through January and the groundhog saw his shadow, let's review some market trends we are seeing across the country in the 1031 Exchange world.

With higher interest rates over the past 18 months, we are having many more conversations about Seller Financing in a 1031 Exchange.
• Can you defer taxes in a 1031 Exchange and carry back a note for your buyer? YES.
• Can it be challenging? YES.
This will be one of the topics we will address on our February Webinar. To learn more, click the link included above.

The Delaware Statutory Trust (DST) has been another popular topic recently. The DST is an investment vehicle that allows investors to purchase a fractional interest in a larger commercial asset but provide you a passive role in the property. Which means, as the investor, you don’t have to worry about taxes, tenants, or any maintenance on the property - simply sit back and collect rent and appreciation on the property. This topic will also be covered on our February Webinar. The link provided above provides more information on DST.

We’ve also seen an uptick in investors beginning to move their investments out of areas that experience extreme weather and/or from states that are not landlord-friendly, from a regulatory perspective. Newsweek reported in November of 2024 that certain metro areas are seeing a significant drop offs; Florida has seen decreases in investor purchases throughout the state by over 10%, Newark, New Jersey saw investor purchases decrease by 19.4%, and Nashville, Tennessee also saw a drop of 14.2%.

While on the other hand, some areas are seeing an influx of investors. Investor purchases in Las Vegas rose 27.6% year over year in the third quarter, Seattle saw an increase of 21.8%, and San Jose rose 19.5%.

Lastly, small multi-family properties (like duplexes) and properties with multiple rentable units on it (a house with a detached casita) are very popular with investors as it gives them additional rental units. We are seeing this trend in our transactions across the country.

As the year continues to unfold and more trends appear, we will continue to share the details with you.

To register for our February Webinar where we will discuss these topic along with others, please click the following link – Click HERE