Like Kind Property Requirement
There is a lot of misinformation regarding what constitutes like-kind replacement property. It is not true that if you sell a condo you must acquire a condo, etc. As long as your relinquished and replacement properties meet the qualified use requirement discussed above any kind of real estate held for investment is like kind to any other kind of real estate that is also held for investment.
You can exchange out of or into any of the following asset types: single family, multi-family, commercial office, retail shopping, industrial, vacant land, oil and gas interests, mineral rights, riparian water rights, and tenant-in-common investments.
Multiple Assets and Fractional Interests
The 1031 exchange allows you to easily reposition, diversify or consolidate your investment real estate portfolios. You can sell one relinquished property and diversify your portfolio by acquiring multiple like-kind replacement properties, or you can sell multiple relinquished properties and consolidate your portfolio by acquiring fewer but larger like-kind replacement properties. You can also sell or purchase fractional (partial) interests in property.
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