Grace’s Recent Posts

How to Calculate Cap Rate

If you’re involved with any kind of real estate investment or holdings, you’ve no doubt heard the term “capitalization rate,” or its shorter version of “cap rate.” Cap rates are used by real estate investors, owners, and others involved in the industry because it helps them understand the relationship between a property’s value, and the net operating income it generates. Let’s unpack these terms, and then learn about the cap rate formula. 

Jun 6, 2023

What is Cap Rate Compression?

Real estate investors seeking potential places to park their investment capital often examine cap rates to determine the viability of investment opportunities. 

May 31, 2023

Can You Sell Multiple Properties in a 1031 Exchange?

There is nothing special about selling multiple properties in a 1031 exchange (also called a forward exchange). However, it can be more difficult than a single property exchange. Compared to a single property exchange, there can be more properties and people involved. This means far more to juggle and maintain, all while trying to beat deadlines. Let’s walk through what this type of transaction might look like.

May 24, 2023

Does Depreciation Restart after a 1031 Exchange?

When investors do a 1031 exchange, their basis carries over into the replacement property. They are also able to continue taking the annual depreciation expense. But does the depreciation restart or change from the existing schedule once the replacement property is acquired? 

May 16, 2023

How Delaware Statutory Trusts (DSTs) Can Diversify Your Real Estate Investment Portfolio

In many cases, portfolio diversification can help support a successful investment strategy. The right moves can help potentially spread  risk and generate steady returns. The idea behind portfolio diversification is that investors shouldn’t put all of their investment eggs in a single basket (in other words, avoid investments in similar investment vehicles).

May 12, 2023

What is an Adjustable Rate Mortgage and How Does it Work?

Mortgage rates for both personal residential use and investment purchases are volatile and can significantly impact the cost of your purchase. When interest rates are low, buyers can afford to buy a more expensive house, and when rates rise, the housing market often experiences lower activity. For lenders, rising interest rates can affect their bottom line if customers have mortgages locked in for thirty years at a lower rate than the institution needs to pay to borrow money.

May 2, 2023

How to Evaluate a Delaware Statutory Trust Sponsor

Participating in a Delaware Statutory Trust (DST) is an attractive opportunity for some investors. For example, the investor might be interested in expanding their geographic reach, reducing their active management of property, or transitioning into a different commercial property sector. Each of these goals may be achievable by investing in one or more DSTs.

Apr 24, 2023

What Happens If You Sell a 1031 Exchange Property At a Loss?

If you’ve been reading our blogs on a regular basis, you know that we publish a great deal of information about 1031 exchanges and potential tax benefits. Specifically, a well-executed like-kind exchange can defer capital gain taxes and depreciation recapture to a future date.  

Apr 19, 2023

Can Net Operating Losses Offset Capital Gains?

Anytime your business’s losses and allowable deductions exceed its income for a given tax year, you’ll be left with a net operating loss (NOL).

Apr 15, 2023

Does a Tenancy in Common Need to Be Filed in Court?

Many legal structures exist when it comes to real estate ownership. There’s sole ownership, joint tenancy, partnerships, and corporations, just to name a few. Then there is tenancy-in-common, sometimes known as tenants-in-common. 

Apr 11, 2023

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