The time period over which real estate is financed is almost always the same period over which depreciation is taken.

Question

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The mid-1980s started out as a bad time for real estate with the passage of the Tax Reform Act of 1986. As part of this legislation, the life over which a real estate investor could write off depreciation for tax purposes was extended from 19 years to 27.5 years for residential rental property and to 39 years for commercial property. This meant that an investor had to wait longer to take full advantage of tax deductions related to real estate. These terms are longer than financing terms.

The Time Period Over Which Real Estate Is Financed Is