Is this a good idea?
Hello BP Mates,
I have a SF rental in Mesa, AZ currently occupied until next October and will have around $120k in equity by that time. CAP rate and R:V is not great, but appreciation is fantastic.
I was thinking of selling and using the capital to buy 4 or 5 rental properties in a market where updated $80K houses at 1% R:V in good neighborhoods exist, like (but not limited to) Memphis, Kansas City, or Huntsville. I would buy all properties in the same market to maximize efficiency. I understand appreciation doesnt compare to Phoenix market. I was thinking of doing a 1031 exchange.
Right now I'm collecting around $3600 in cash flow from my Mesa property. My analysis suggests I could potentially triple that with my proposed strategy.
Am I thinking straight here?