We’ve long seen firsthand the role like-kind exchanges play in building generational wealth, empowering entrepreneurs, and revitalizing neighborhoods. But the story goes even deeper. Section 1031 of the Internal Revenue Code is not just a tax deferral tool—it’s a catalyst for economic opportunity, especially for groups historically excluded from traditional financing pathways.
A Powerful Wealth-Building Tool for Women, Minorities, and Veterans
In a housing market where the median age of a first-time homebuyer is now 38 and only 24% of home purchases from July 2023 to June 2024 were made by first-time buyers (National Association of REALTORS®), building wealth through real estate is more challenging than ever. For women, minorities, and veterans, these challenges are amplified, but 1031 exchanges provide a powerful solution.
A 1031 exchange allows real estate investors to defer capital gains taxes by reinvesting the proceeds from the sale of an investment property into another like-kind property. Rather than losing a significant portion of their profits to taxes, investors can keep their equity working for them—scaling up, diversifying their holdings, or shifting into more profitable markets.
But a 1031 exchange is more than just a tax strategy. It’s a ladder to opportunity, especially for individuals who have historically faced barriers to financial growth. For women, minorities, and veterans, 1031 exchanges open the door to financial freedom, entrepreneurship, and community leadership.
A Pathway for Women-, Minority-, and Veteran-Owned Businesses
One of the most meaningful aspects of our work is witnessing how Section 1031 helps level the playing field. We've assisted numerous veterans who bought a primary residence while on active duty, only to be deployed and convert that home into a rental property. They soon discovered the value of passive income. These veterans often share their experiences with fellow service members, creating a grassroots movement of investor-owners within the military community.
This same momentum extends to women- and minority-owned businesses, where access to capital has historically been limited. Through like-kind exchanges, entrepreneurs can preserve and reinvest equity from existing properties into new ventures, helping them scale, diversify, and thrive—all without the burden of taking on new debt.
Wealth Building Through Real Estate
- Women can use 1031 exchanges to grow their real estate portfolios—from a single rental property to a portfolio of commercial buildings—without being burdened by immediate capital gains taxes.
- Minority investors benefit by deferring taxes and reinvesting in appreciating assets, helping to close the wealth gap and create long-term financial security.
- Veterans can leverage service-related benefits to enter the real estate market and use 1031 exchanges to trade up to more lucrative investments, creating stability and legacy.
Entrepreneurial Opportunities
- Women entrepreneurs use 1031 exchanges to reinvest savings into growing businesses, funding development projects, or diversifying their holdings.
- Minority entrepreneurs often exchange one property for another that supports their business operations, creating real ownership in their communities.
- Veterans transitioning to civilian life have used exchanges to launch service-based businesses, lease properties for income, or develop veteran-focused housing.
Revitalizing Communities Where Capital Falls Short
Many like-kind exchange transactions result in redeployment of capital into underserved or distressed neighborhoods—places where traditional financing is scarce. Section 1031 fills this gap by allowing investors to bring new housing, development, and economic life to the areas that need it most.
Fueling Affordable Housing and Local Investment
Did you know that approximately 40% of 1031 exchanges involve rental housing? These exchanges directly support the supply of affordable rental units in many markets.
Unlike Low-Income Housing Tax Credits, Section 1031 can help developers cover the land acquisition costs—one of the biggest hurdles in getting affordable housing projects off the ground. And most of these deals aren’t made by large institutional investors, but by “mom-and-pop” landlords who roll 100% of their equity into replacement properties, reducing their reliance on financing—especially critical in a high interest rate environment.
Economic Mobility & Equity Preservation
By deferring taxes, 1031 exchanges reduce financial obstacles and create mobility for underrepresented investors. They also preserve equity—something that’s especially valuable for those facing systemic wealth inequities. Every dollar saved through deferral is a dollar that can be reinvested to scale faster, provide housing, or support local businesses.
Knowledge Sharing & Mentorship
1031 exchanges also foster a culture of collaboration. Women, minorities, and veterans are participating in mentorship programs and investor networks where they learn how to leverage tax strategies like 1031 to build their portfolios and strengthen their communities.
Equity Preservation and Financial Literacy
Systemic wealth inequities often create steeper uphill climbs for underserved groups. The 1031 exchange helps level the playing field by preserving hard-earned equity that might otherwise be lost to taxation. When paired with strong financial literacy education, 1031 exchanges foster a new generation of informed, empowered decision-makers in real estate—those who build wealth, invest in their communities, and create lasting impact.
Why This Matters More Than Ever
Today’s real estate landscape is tough—rising prices, tighter credit, and fewer opportunities for first-time buyers. But 1031 exchanges fill critical gaps:
- They keep housing and commercial property in the hands of local investors.
- They help small business owners scale without taking on debt.
- They allow investors to reinvest fully—strengthening financial security and community stability.
Our Mission: Fueling the Restless Pursuit of Opportunity
This is why we do what we do. Every like-kind exchange we facilitate is more than a transaction—it’s a building block for economic mobility, financial independence, and stronger communities. At 1031 CORP., we believe in helping our clients seize every opportunity to grow, reinvest, and thrive. That belief is deeply rooted in our core value: supporting the restless pursuit of opportunity for our clients, our referral partners, and our communities.
We’ve seen firsthand how Section 1031 helps create momentum, turning a single investment into a pathway for long-term success. Whether it’s a veteran-turned-landlord discovering the power of passive income, a mom-and-pop investor exchanging into retirement security, or a minority-owned business expanding its footprint, these are more than success stories. They’re examples of what happens when access meets opportunity.
We take great pride in the relationships we build and the futures we help shape. Every exchange tells a story of progress. And we’re honored to play a part in that journey—helping our clients take the next step, and the one after that, in their climb toward lasting prosperity.
