Posted 9/13/2021 20:09 (#9218724 - in reply to #9218632) Subject: RE: Housing market
We were very lucky and everything fell into place for us.
TLC Rentals (our rental house company) sold a few houses last fall with plans of dumping the rest of them and just paying taxes. In January one of our landlords decided to sell a farm and was willing to work with us on timing.
When we started to get close on selling the first rental in ‘21 we started a 1031. We listed all the houses that we felt would close out quickly. We understood we couldn’t negotiate on selling the houses, we had to grab a reasonable contract and push hard for a quick close. Meanwhile I had the 277 acres surveyed into 3 tracts. Our land holding company is Crossley Investments LLC. Because of the 1031 TLC had to be part owner in 1 tract. We timed it to where the we sold the last house and closed on the farm the next day.
We have done many 1031s over the years so we understand the mechanics of them. The reason for three tracts on the farm: 1 tract will be sold to my son( that happens this Wednesday). This will be his first property. We wanted TLC to own no more than necessary because we plan to dissolve that company after the time restraints that the 1031 has on us. Crossley Investments owns the majority of land holding.
Depreciation: I can’t answer how many years the schedule was for these houses. I was done with rentals and was planning to sell them regardless. I was hoping to find a farm somewhere but hadn’t gotten to that point yet. That’s when we made the deal with the landlord. For the record I paid a premium for this farm. It’s one of the most expensive farms that has sold in the last two years in our area. It was a hard pill for me to swallow to pay that premium.