Many people buy various types of real property as investment. The advantages are obvious: a small down payment plus a mortgage, rental income that covers the expenses, mortgage payments, and taxes, depreciation that can be written off against other income for tax purposes, appreciation of the property's value, capital gains tax treatment on sale profits. But, it can be a lot of work. Finding and keeping good tenants, property maintenance, unruly tenants, property damage, and other problems deter many from engaging in ownership of income property. Many who do buy income property grow weary of the responsibility, problems and complaints and would like to find a way out without experiencing a huge tax cost. Sec. 1031 property exchanges offer one way to solve the real estate investor's dilemma, often affording the investor relief from the management responsibilities while at the same time avoiding the capital gains tax cost, maintaining a good cash flow, and even restoring some of the tax benefit.