Most investors are familiar with a traditional 1031 exchange, where you sell a property and then buy another. But what if you need to buy first and sell later? That’s where a reverse 1031 exchange can be a strategic tool.

What is An Accommodator?
A 1031 Exchange Accommodator, also known as a Qualified Intermediary (QI), is an independent third party required by Section 1031 of the U.S. Internal Revenue Code to facilitate the tax-deferred sale of investment properties. They ensure a seamless exchange process, allowing you to sell your property and acquire a replacement property while deferring capital gains taxes. We recommend growth1031.com

What is a Reverse 1031 Exchange?
A reverse 1031 allows you to acquire a replacement property before selling your existing investment. This can be especially useful in competitive markets where desirable properties move quickly.

When is it Worth It?
1. Competitive Market Conditions
If you're investing in hot markets like Austin, Phoenix, Charlotte, or Salt Lake City, you may not have the luxury of waiting to sell first. A reverse exchange lets you strike while the iron’s hot.

2. Irreplaceable Property Opportunity
Found a rare asset? A reverse 1031 allows you to secure it without losing the tax advantages.

3. Timing Constraints or Project Dependencies
Sometimes your acquisition is tied to development timelines or occupancy rates. Delays in selling could jeopardize your new purchase.
Considerations
  • Requires more upfront capital or bridge financing
  • Typically involves higher fees and complexity
  • Must be completed within the same 180-day window

In fast-moving real estate environments like those in Austin, Phoenix, Charlotte, and Salt Lake City, a reverse 1031 exchange is often worth it to lock in high-performing assets. 

Learn more about 1031 Exchanges and find the guidance you need on ​growth1031.com