For different types of properties, there are a number of set acquisition requirements that have to be met by the investors. For instance, an investor has to have experience dealing with certain property investments. If they want to invest in commercial real estate, they may have to show that they have experience or adequate knowledge about such investments. The acquisition and exchange requirements differ in different areas. For instance, some states have an age limit for investors. You can own property is you are under the age of 18 or 21 in some areas. These requirements can pose a challenge to investors especially the ones who are just starting out. Taxes One of the main challenges that investors have to face is payment of taxes. For instance, if your property has appreciated in value, you will have to pay a higher tax when trying to dispose it. These taxes can hinder an investor from re-investing their returns in an equally priced property. However, there is an Internal Revenue code for deferred exchange that normally helps investors in this predicament. With this law, an investor can use all the proceeds that they get from a capital; gain and re-invest in another property. Apart from the taxes, investors should also try and avoid the depreciation recapture which normally leads to loss of investments. Loans
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