1031 Conundrum in Seattle
Hey guys,
Have a 1031 question for you experts out there.
A bit of background is first in order;
I began buying duplexes in Seattle in 2011. Between 2011-2013, I bought one duplex per year. Once I had the system figured out a bit better, I have started buying larger buildings (all based in Seattle).
I got lucky with my first 3 duplex purchases, and cash flow has increased significantly, which in turn has bumped up valuations.
I am now considering selling my first 3 duplexes, and using the proceeds for a 1031 exchange to buy a larger (12-15) unit apartment building, hopefully also in the Seattle area.
So, here is my question;
How hard is it to line up a 1031 exchange deal BEFORE I sell my 3 duplexes? I am very reluctant to sell the 3 properties and then hit the road running to find a property to buy, as I have been informed by many very experienced RE investors that this is Russian roulette, and that I should avoid it at all costs.
However, I can see it being quite difficult to go to a prospective seller, and try to convince him/her that I need a deal preconditioned on me selling not one, but 3 separate properties before I can go forward with the purchase. This difficulty is only compounded by the fact that Seattle is a very competitive sellers market, and getting any kind of deal on a multi-unit is hard enough to do, let alone one that would first allow me to sell 3 different properties before closing on the purchase.
Would be very interested in hearing thoughts from those that have been in a similar position before.
Thanks everyone!
Micah