1031 Leverage Calculator
Enter your Equity, Debt and the Replacement loan-to-value (LTV) you are considering.
| From this offering’s forecast. |
Effect of Leverage
Change in Real Estate Acquired
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Enter your numbers above
Debt Replacement LTV
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Calculated from your numbers.
Property Sold
| Real Estate Sold | — |
| Value After Change | — |
| Debt on Property Sold | — |
| Equity | — |
| Return on Equity | — |
Replacement LTV
| Real Estate Acquired | — |
| Value After Change | — |
| Debt | — |
| Equity | — |
| Return on Equity | — |
What Your Numbers Show
Enter your numbers above to see how your leverage choice changes the real estate you acquire, the debt behind it, and your return on equity.
IMPORTANT: The projections or other information generated by this calculator regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results and are not guarantees of future results. Results may vary with each use and over time. The calculator uses only the figures you enter, considers no other investments and favors none. Forecast cash on cash is the sponsor’s estimate and may change. Higher leverage may increase potential gains or losses.
How to read this calculator
What do I enter first?
Start with Equity — the cash coming out of your sale after costs and any debt payoff. Then Debt, the mortgage that was on the property you sold. Leave it at 0 if you owned it free of debt. Those two are enough to see results.
What is Debt Replacement LTV?
It is the leverage on the property you sold — your old mortgage as a percentage of what the property was worth. Sell a $2,500,000 property carrying $1,500,000 of debt and it is 60%. That figure is the benchmark your replacement gets measured against. It is rounded to two decimals on screen but calculated to eight, and Match this LTV uses the full figure — on a large exchange that difference can matter.
What does “Match this LTV” do?
It sets Replacement LTV to that exact figure in one click. A 1031 exchange generally expects you to replace your debt as well as your equity, and coming in below your old LTV can leave a shortfall that may be treated as taxable boot. This button matches your previous debt level without the arithmetic, using the precise figure rather than the rounded one shown on screen.
What is Value Change for?
It shows what happens to your equity if the property’s value moves. Debt stays the same, so the entire change in value affects your equity — which is why the swing is larger than the percentage you type. At 70% leverage, a 1% move in value changes your equity by roughly 3.33%. That is leverage working in both directions.
What does Cash on Cash % show me?
Enter the forecast cash on cash from the offering you are considering to see the estimated income on your equity, annually and monthly. It is optional — leave it blank and nothing appears. The rate is the sponsor’s forecast and is not guaranteed.
Why are some rows blank under Property Sold?
Value After Change and Return on Equity are left blank under Property Sold because you no longer own that property. Those calculations apply only to the replacement property.
Other 1031 calculators
All six are on the 1031 exchange calculators page.
Property Sale Calculator
What you have to reinvest, and the tax if you don’t.
Tax Deferral Calculator
Estimate the tax you may be able to defer.
Deadline Calculator
See your 45-day and 180-day dates.
Replacement Calculator
Check whether your DSTs replace equity, debt and value.
Boot Calculator
See what may be taxable when your DST is sold.
1031 exchanges and DSTs
What is a 1031 exchange?
The rules, the timing and what may be deferred.
What is a DST?
How Delaware Statutory Trusts work as replacement property.
Common questions
Answers to the questions we are asked most often.
We can help you make the most of your 1031 exchange.