Upgrading from Duplex to Multi-unit via 1031 Exchange - Thoughts?

[Harrison Lopes]

Hi BP Community,

I'm interested in folks' input on whether the below is a good idea and if they have had experience doing what I'm thinking about.

First some background...I purchased a condo shell for $25K (cash) a few years back. We did a full renovation and legally converted it to a duplex and it has been cash flowing nicely since. While the money coming in is good, I feel a little stuck...as if I have plateaued with my RE portfolio and now might be the time sell it and use the proceeds to invest in a bigger property with more than two units (potentially bigger cashflow).

This idea hit me when I was browsing Trulia and realized that my property value was around $105k. Other comparables also were valued around that price. Therefore, since I paid all cash for my property, selling it could potentially net me proceeds of, let's say, $75K. Which I could then use with a 1031 exchange to invest in a property with many more units. Basically using the sale of my duplex to upgrade my unit total.

Therefore my questions are a) Those this sound like a good idea, b) if so, where do I even begin when it comes to looking for multi-unit properties for sale, c) are there forums on BP that have already gone in depth regarding this strategy and what it takes to manage a multi-unit (more than two) building?

Any thoughts would be greatly appreciated. Take care!