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why would an investor choose to exchange a property rather than just keep what they already...

why would an investor choose to exchange a property rather than just keep what they already have?

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Answer #1

The first reason for exchanging property is that it may be a better deal than the existing one. This can also be a powerful strategy for deffering tax and is used by successful investors. The exchange allows an investor today for the payment of capital gains taxes on a property when it is sold so long as another similar property is purchased with the profits. This is also valid when one property is literally exchanged for another of a similar nature and of similar value.

In this process the capital gains are avoided for the time being and so it is preferred by investors.

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