I bought rental property number 26 this week using a 1031 exchange. I sold rental number 24 for $270,000 and put $155,000 of the proceeds from that sale into the purchase of 3 houses and a commercial building for $410,000. This property is not very nice, but it was an amazing deal. I feel like I say that about a lot of the properties I buy! The houses are all small but they are rented for $600 to $700 each. The actual market rent on the houses would be closer to $1,000 if we were to fix them up a little and re-rent them. There is also a 2,600 square foot commercial building that is rented for $1,600 a month.
The property cash flows as it is but has a ton of upside and that is why I was willing to buy something that is so unique and needs some work. We could raise rents on everyone and make it worth twice as much as it is now. There is also major development potential with the property being right on a major 4-lane highway and the city wanted the entire area to be redeveloped.
We shall see what happens in the future and if my tenants actually pay rent!
I sold rental number 14 for $270,000 to exchange into this property. I had bought that property for $134,000 in 2015.
You can see the video of the property when I first got it under contract here:
Here is rental number 14 after we finished fixing it up:
Here is my article on Cap rates with the cap rate calculator:
Here is a page with all of my rentals:
Here is more info on 1031 exchanges:
Thank you for all the likes and comments!
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