Last updated on July 6th, 2021 at 10:24 am
Texas’ 1031 exchange rules and regulations | Best 1031 exchange companies in Texas | Do I need to use a 1031 exchange company near me?
Texas’s real estate market is one of the hottest in the U.S. Median home values nearly doubled in less than a decade, from $132,000 in 2011 to just under $236,000 in 2021, according to Zillow.
The state’s business-friendly regulatory environment has kept investment money flowing in so fast that the market can hardly keep up. In Houston, the pace of development was so heated that a developer who built small townhouses on a vacant lot sold them directly to a larger developer, who immediately tore down the brand-new townhouses and replaced them with a 730-unit apartment complex.
In this red-hot environment, Texas investors interested in protecting their profits from federal capital gains taxes can turn to the 1031 exchange, mirroring national trends.
Texas’s 1031 exchange rules and regulations
Texas doesn’t have any state laws governing or restricting 1031 exchanges. So whether you’re doing a Dallas 1031 exchange, an Austin 1031 exchange, or a San Antonio 1031 exchange, you’ll be playing by the same rules as investors anywhere else in the U.S.
| 🏠 A 1031 exchange primer If you’re considering a 1031 exchange in Texas, you probably know the basics. But if you need to brush up, check out our guides: |
The 4 best 1031 exchange companies in Texas
Our team surveyed 1031 exchange companies in Texas from Beaumont to El Paso, and picked the best four in the state.
The chart below offers a quick reference guide, while below you’ll find detailed profiles of each of the companies.
| Texas 1031 Exchange | IPX 1031 | Texas Escrow Company | Asset Preservation Inc. (API) | |
|---|---|---|---|---|
| Year established | 1993 | 1988 | 1991 | 1990 |
| Member of the Federation of Exchange Accommodators?* | ✅ | ✅ | ❌ | ✅ |
| Local offices | ✅ | ✅ | ✅ | ✅ |
| Company size | 2 employees | 100+ employees | 500+ employees | 58+ employees |
| Cost of deferred 1031 exchange | n/a | Starts at $1,000 | n/a | $1,000-$2,000 |
| Cost of a reverse 1031 exchange | n/a | $6,000+ | n/a | Varies |
*The Federation of Exchange Accommodators is the national trade association for 1031 exchange practitioners, and sets industry guidelines and standards
Texas 1031 Exchange
The local, independently-owned company has offices in Texas and Oklahoma. Founded in 1993 by two real estate professionals who still run the company, Texas 1031 exchange offers standard 1031 exchanges, as well as variants of interest to Texas and Oklahoma investors, like farm, ranch, and livestock exchanges, or exchanges involving mineral, oil, or gas rights.
Year established: 1993
Locations: Austin and Oklahoma
Website: https://texas1031exchange.com/
Leadership: Wayne H. Roitsch, President (15 years)
Member of the Federation of Exchange Accommodators (FEA)? Yes
Rating: A+ on Better Business Bureau
Company size: Two
Staff strengths: Founders Roitsch and Sydney A. Miller are licensed real estate salespeople in the state of Texas. They’re also certified exchange specialists, which means they’ve passed the FEA exam.
Costs: n/a
Is the client’s money separated or commingled with others? n/a
Bonded and insured? Yes. Fidelity bond of $1 million (per occurrence), and $500,000 in errors and omissions coverage
Expertise: Texas 1031 Exchange offers more common 1031 exchanges (deferred, reverse, improvement, and combination) as well as regional specialties like farm, ranch, and livestock exchanges.
IPX 1031
IPX 1031 is a large and respected national player in 1031 exchanges, with offices in Austin, Dallas, Houston, and San Antonio. Investors are well served by a company this size, with little cause to worry about the company going bankrupt.
IPX’s 1031’s expertise in reverse 1031 exchanges and improvement 1031 exchanges is of special note.
Year established: 1988
Locations: Austin, Dallas, Houston, and San Antonio, and nationwide
Website: https://www.ipx1031.com/
Leadership: John Wunderlich, President (10 years)
Member of the Federation of Exchange Accommodators? Yes
Rating: A+ on Better Business Bureau
Company size: 100+
Staff strengths: Commercial real estate and legal experience
Costs: Deferred exchange: $1,000+; reverse exchange: $6,000+
Is the client’s money separated or commingled with others? Separated
Bonded and insured? Yes. $100 million fidelity bond, and $30 million in errors and omissions coverage
Expertise: IPX 1031 has a division dedicated to reverse and improvement exchanges.
Texas Escrow Company
Texas Escrow Company is primarily a title company, but it also offers 1031 exchange services. Its size and experience as a major title company in Texas gives them a lot of institutional knowledge about the Texas real estate market.
Year established: 1991
Locations: Texas
Website: https://www.republictitle.com/
Leadership: Carla Janousek, Senior Vice President
Member of the Federation of Exchange Accommodators? No
Rating: n/a
Company size: 500+
Staff strengths: As a title company, it has substantial real estate experience across the entire team
Costs: n/a
Is the client’s money separated or commingled with others? n/a
Bonded and insured? Yes
Expertise: Texas Escrow Company is financially stable, and has substantial and diverse experience in the real estate industry. It can conduct delayed 1031 exchanges, reverse 1031 exchanges, improvement 1031 exchanges, and simultaneous 1031 exchanges.
Asset Preservation Inc. (API)
Summary: The high-volume exchange company has handled more than 180,000 1031 exchanges since the company’s founding in 1990. With stable leadership — APIs president and CEO has served for more than twenty years — offices in Austin and Houston, and solid reviews, the company’s a safe choice for most Texas investors.
Year established: 1990
Locations: Austin, Houston, and nationwide
Website: https://apiexchange.com/
Leadership: Javier G. Vande Steeg, President and CEO (20+ years)
Member of the Federation of Exchange Accommodators? Yes
Ratings: A+ on Better Business Bureau, 3/5 stars on Google (2 reviews)
Company size: 58
Staff strengths: Many API employees are certified exchange specialists, which means they’ve passed the Federation of Exchange Accommodators exam.
Costs: Deferred exchange: $1,000-2,000; Reverse exchange: varies
Is the client’s money separated or commingled with others? Separated
Bonded and insured? Yes
Expertise: API has experience with all types of exchanges, including the most common delayed 1031, improvement 1031, and reverse 1031 exchanges.
| 1031 exchange trends According to a July 2020 report from the National Association of Realtors:
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Do I need to use a 1031 exchange company near me?
If you live in Southlake, using a Dallas-based 1031 exchange company is convenient — but not required. A 1031 qualified intermediary in Austin, Houston, or San Antonio could do a great job, as could a company based outside Texas.
The truth is, you don’t need to use a local qualified intermediary (QI). But, in some cases, you may want to.
Let’s look at the pros and cons of using a local Texas or national 1031 exchange company.
Using a qualified intermediary near you for a Texas 1031 exchange
| ✅ Pros | ❌ Cons |
|---|---|
| Familiar and comfortable with local market dynamics | If you’re also interested in exchanging properties outside Texas, your QI may not be familiar with that state’s regulations |
| Able to engineer a quick sale if you’re up against the 180-day deadline | Smaller companies may do fewer transactions, so their fees may be higher than high-volume national companies. |
| Likely has a proven network of local providers to help execute your exchange smoothly | Less institutional experience to handle unusual obstacles |
Using an out-of-state qualified intermediary for a 1031 exchange in Texas
| ✅ Pros | ❌ Cons |
|---|---|
| Investors who own property in multiple states will often get more varied experience with a national company | May not understand local market dynamics |
| Extensive institutional experience and built-out professional network can handle almost any problem | Lack of local experience can result in low sale prices or delays that endanger the 1031 exchange’s 180-day deadline |
| Higher volume of transactions can translate to lower fees | May not be able to recommend reputable local service providers |
Choosing the right qualified intermediary for your Texas 1031 exchange can make the difference between a smooth, profitable exchange, and one that’s delayed or even invalidated.
Contact us today and we’ll put you in touch with one of our seasoned 1031 exchange experts, who’ll listen to your needs and recommend the best course of action.
