Atlanta, GA · Member since 2015 · 11 posts · 3 votes
Hi Everyone,
I'm getting ready to do another 1031 Exchange. Would you buy one rental property for X amount or two that would equal that X amount? I know this is VERY broad and specific numbers would need to be analyzed, but I'm merely interested in ppl's initial thoughts on the issue. Are there any generally-shared beliefs out there? I would appreciate your thoughts.
Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
5y
You usually will collect a higher total rent with the two properties that cost the same as one that costs twice as much and your risk of vacancy will be lower. Your capex and repairs MiGHT be higher, although they could also be lower if it’s a quality rather than size difference in prices. Plus it’s easier to sell/exchange just 1 property in the future while holding on to the better one. If you have enough equity another favorite option is to buy one with cash and one with maximum leverage so you have the best of both worlds.