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Michael Cai
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1031 exchange ideas?

Michael Cai
Posted Apr 3 2024, 05:26

Hi we are selling a rental property in Charlotte which currently brings in 2000/mo , the house has a market value of 450k. What’s some good areas to buy in terms of long term or short term rental in atlanta area ? Looking to do a 1031 exchange into something that maximizes income. Also considering Airbnb type property and outside of local area if the numbers are right..

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Dave Foster
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#1 1031 Exchanges Contributor
  • Qualified Intermediary for 1031 Exchanges
  • St. Petersburg, FL
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Dave Foster
Pro Member
#1 1031 Exchanges Contributor
  • Qualified Intermediary for 1031 Exchanges
  • St. Petersburg, FL
Replied Apr 3 2024, 09:20

@Michael Cai, Great questions to ask now!!!  So many options depending on what the market is telling you and what your investor strengths are.  Since the 1031 will let you go anywhere in the US into any type of investment real estate.  I'd just strongly encourage you to get a good handle on those two things:

1. What your strengths and desires are.

2. What the market is telling you.


These will help you to refine and control the scope of your search.  And if you aren't really focused on type and location before your sale, the 45 day identification period will race past.  And you'll have a tough time getting enough due diligence done to complete your 1031 successfully.

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Josh Bowser
  • Real Estate Agent
  • Atlanta, Ga
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Josh Bowser
  • Real Estate Agent
  • Atlanta, Ga
Replied Apr 3 2024, 12:38

Hey Michael - we do a lot of business with rent by the room on a MTR basis that are providing some good returns for investors the Fulton, Dekalb, Clayton, and Cobb counties.

Feel free to reach out - happy to help however I can!

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Sean Ross
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  • Denver, CO
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Sean Ross
Tax & Financial Services
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  • Denver, CO
Replied Apr 4 2024, 08:08

@Michael Cai,

Is your $450K owned free and clear? 

With borrowing rates as high as they are, it could be difficult to maximize income by 1031 exchanging into a rental that is both (a) financed, and (b) in an urban area where prices may still be close to 2023 peaks. 

Have you considered 1031 exchanging into any other types of cash-flowing assets if your goal is to a max out cash flow?

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Jake Andronico#4 House Hacking Contributor
  • Realtor
  • Reno, NV
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Jake Andronico#4 House Hacking Contributor
  • Realtor
  • Reno, NV
Replied Apr 4 2024, 12:29

@Michael Cai

Great problem to have! Sounds like you're looking to "un-trap" your equity. Do you have any debt on the property? 

With out of the area Airbnb's, you're probably going to want to hire someone to manage which typically costs 25-30%. You may end up at a similar cash flow rather than just going into a newer, easier to manage property for a LTR. 

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Mark Faulkner
  • Real Estate Consultant
  • Roswell, GA
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Mark Faulkner
  • Real Estate Consultant
  • Roswell, GA
Replied Apr 10 2024, 21:18
Quote from @Michael Cai:

Hi we are selling a rental property in Charlotte which currently brings in 2000/mo , the house has a market value of 450k. What’s some good areas to buy in terms of long term or short term rental in atlanta area ? Looking to do a 1031 exchange into something that maximizes income. Also considering Airbnb type property and outside of local area if the numbers are right..

@Michael Cai

There are a few good markets in Georgia, but there is one that is blowing them all out of the water right now! I've got a good pulse on which markets are thriving and it is not STR either. Let me know if you would be interested in a quick chat to see if this market is right for you.