The 1031 bubble in real estate ready to pull the market down drastically
Peter Oberois
May 28, 2007

It lets investors who sell investment properties defer capital-gains taxes if they invest the proceeds in ‘like kind’ property within 180 days.

It is a bonanza of tax deferred mega capital gains if the markets keep rising. It is well known among the real estate brokers and investors. But the recent mini crash in real estate has caused a serious problem in the 1031 strategies.

Normally a real estate investor would sell a property with big capital gains and wait to find and buy another property within 180 days. The gains roll over into another property creating a bonanza in tax differed real estate investment. The compounded gains keep increasing making real estate investors’ rich.

But the whole concept is coming under scrutiny as the real estate market is clobbered with steep price falls and largest unsold inventory in the past fifty years.

The net result is a further collapse in real estate prices. The 1031 tax benefit if withdrawn even partially will create a nasty crash in residential and commercial real estate.

The 1031 bubble in real estate ready to pull the market down drastically
Peter Oberois
It lets investors who sell investment properties defer capital-gains taxes if they invest the proceeds in ‘like kind’ property within 180 days
READ MORE>>

Analytics point to overstated job growth in official employment data – was it deliberate?
Sam Adelton
Is possible that underemployment in the economy has created a massive flaw in the way job growth is calculated.
READ MORE>>

Tapping the Internet and relocation market in selling your home in difficult times – here are some tips
Maria Hernandez
It is a difficult time for the home sellers. The realtors are not letting the how owners get out of the selling contracts. They are forcing homeowners to reduce prices slowly but steadily. Here are some tips what you can do:
READ MORE>>

What happens to world stock market if Chinese market crash – where does Dow go?
Peter Oberois
However, Japan, US, and EU have their problems. That will affect the respective stock market. The US stock market will resume its bear trend that started in year 2000 and make new lows before the end of 2009.
READ MORE>>

Greenspan warns on China but in reality the emerging markets like China and India can crash 80% in the next three years
Karen Zuba
Both China and India face massive inflation with high growth. The stock market of both the countries are in bubble stage ready to collapse.
READ MORE>>

Increase in Initial Jobless Claims and slower increase in Durable Goods Orders point to soft landing than a recession – but the key is the gas price
Fred Day
The answer lies on something that is beyond Initial Jobless Claims and Durable Goods Orders numbers. It is the gasoline price. A $3.00 a gallon is hurting the economy.
READ MORE>>

New Home Sales data points to market stabilization and solid recovery in the next twelve months
Sam Adelton
The bearish sentiment among the realtors and the new homebuilders has reached a new high. Normally the opposite happens in these circumstances. Analytics and quantitative models are pointing to rally in new home market.
READ MORE>>

MORE ARTICLES >>