1031 exchange qualifying
I am interested in doing a 1031 exchange but I do not know if the property I am interested in can qualify. I am interested in a small (25-space)mobile home park that also has a brick home on the property that the owner used as his principle residence. I feel that in order to qualify for a loan I will have to owner/occupy the brick home. Will a 1031 exchange be possible? Lynnie G.
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Sorry Lynnie G. The 1031 rules do not allow your personal residence to be used as the replacement property.
Your transaction will have to be divided into two parts -- the purchase of the MH park and the purchase of the house as your primary residence. The portion of the purchase that is the (25-space) MH park is eligible to participate in a 1031 exchange.