I need to spend $1 million

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I need to spend $1 million

Steven Escobedo
Lake Forest, CA · Member since 2017 · 29 posts · 11 votes

I just sold the property in California and I need to do a 1031. I have experience with short-term rentals, but I need to get out of California. Where can I find a property worth 1 million bucks that gives 15% cash on cash? Or should I buy two at 500? Or heck should I buy one of at 500 and buy a duplex triplex somewhere in the Midwest as well?

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Mike GrudzienPro Member
Lender · Eugene, OR · Member since 2019 · 2k+ posts · 1k+ votes
7mo

You are doing a 1031 and you didn't identify a property in advance?

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  • Collin HaysBusiness Member
    Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
    7mo

    Lots of great advice here, but the OP has gone radio silent.  

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    • Ken M.
      Investor · Get yourself trained before doing something inadvisable. · Member since 2024 · 3k+ posts · 1k+ votes
      7mo
      Quote from @Collin Hays:

      Lots of great advice here, but the OP has gone radio silent.  

      Yeah, another "ask and run". Lol
      1Reply
  • Stacy RaskinBusiness Member
    Lender · Member since 2022 · 1k+ posts · 508 votes
    7mo

    Diversifying would make the most sense if looking to cash flow. 

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  • Collin HaysBusiness Member
    Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
    7mo

    Did the OP spend his $ million yet?

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    1Reply
  • Michael S.
    Huntsville, AL · Member since 2018 · 577 posts · 864 votes
    7mo

    Don't know if the OP is legit or not.  

    Don't care.

    What's sad is this thread is a snapshot of what BP has become, and why I continue to frequent it less than ever before.  

    2Reply
    • Collin HaysBusiness Member
      Property Manager · Gatlinburg, TN · Member since 2020 · 3k+ posts · 4k+ votes
      7mo
      Quote from @Michael S.:

      Don't know if the OP is legit or not.  

      Don't care.

      What's sad is this thread is a snapshot of what BP has become, and why I continue to frequent it less than ever before.  


      Post-and-run?

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      0Reply
  • Melissa HaworthBusiness Member
    Real Estate Agent · The Panhandle | The Emerald Coast | Panama City Beach | Destin · Member since 2017 · 257 posts · 101 votes
    7mo

    Steven, congrats on the sale. That’s a strong position to be in, even if the 1031 timeline adds some pressure.

    I’ll be candid with you. A true 15% cash on cash return in today’s environment is tough in most established vacation markets, especially if you’re using leverage. Not impossible, but it usually requires buying well below market or materially improving performance.

    In strong STR markets like Destin or Panama City Beach, a $1M property can absolutely generate strong gross revenue. The real question is what your debt structure looks like and how conservatively you're underwriting occupancy. Insurance, property taxes, and HOA dues if it's a condo can shift returns more than most out of state investors expect.

    As for one $1M property versus two at $500K, that really comes down to risk tolerance. One larger beachfront or luxury property can outperform, but it concentrates risk. Two at $500K spreads vacancy risk and often provides more flexibility on exit. I see a lot of investors leaning toward diversification right now because STR performance can vary seasonally and operationally.

    Blending one STR with a duplex or triplex in the Midwest is not a bad hedge either. STRs can produce strong seasonal cash flow, but long term rentals provide steadier income. It depends on whether you are optimizing for higher upside or smoother consistency.

    If 15% cash on cash is a hard target, I would stress test your assumptions carefully and avoid relying on peak 2021 and 2022 revenue comps. In many coastal markets today, disciplined underwriting tends to land closer to 8 to 12% unless there is a clear value add opportunity.

    With $1M to deploy in a 1031, structure and market selection will matter more than simply choosing one versus two properties. The strongest returns usually come from buying right, not just buying bigger.

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  • Mayo GilfurtPro Member
    Real Estate Consultant · Connecticut Ct · Member since 2026 · 130 posts · 30 votes
    7mo
    Quote from @Bryan Housley:

    Interested in a monster beach house in Gulf Shores?? I have one for sale. Im ready to retire so Im selling my properties.  It's listed at $2.1m

    Hey Bryan — saw your comment about the Gulf Shores property. Is it currently being used as a short-term rental, or strictly personal use? If it’s producing income, there may be DSCR buyer financing options that could expand your buyer pool beyond all-cash purchasers.
    0Reply
  • Bryan Housley
    Investor · Saint Louis, MO · Member since 2016 · 4 posts · 2 votes
    7mo

    its currently an active STR. Im just tired and ready to retire

    0Reply
    • Mayo GilfurtPro Member
      Real Estate Consultant · Connecticut Ct · Member since 2026 · 130 posts · 30 votes
      7mo
      Quote from @Bryan Housley:

      its currently an active STR. Im just tired and ready to retire


       Thanks for the reply Bryan.

      Since it's an active STR, are you looking to sell it outright or would you consider refinancing and pulling equity before stepping away?

      Curious what exit makes the most sense for you at this stage.

      0Reply
  • Bryan Housley
    Investor · Saint Louis, MO · Member since 2016 · 4 posts · 2 votes
    7mo

    prefer to sell outright 

    0Reply
  • Jimmy LieuBusiness Member
    Real Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
    7mo
    Quote from @Steven Escobedo:

    I just sold the property in California and I need to do a 1031. I have experience with short-term rentals, but I need to get out of California. Where can I find a property worth 1 million bucks that gives 15% cash on cash? Or should I buy two at 500? Or heck should I buy one of at 500 and buy a duplex triplex somewhere in the Midwest as well?

    Hey Steven, congrats on closing your California property and getting ready for a 1031! Hitting 15% cash on cash at a $1 million price point is tough in most markets, but splitting your capital can open up more opportunities. One strategy a lot of investors are using is pairing a smaller higher-cash-flow property with a few smaller units in a strong Midwest market like Columbus, Ohio. The market still allows deals in the $120–180K range that hit the 1% rule and cash flow nicely, with strong long-term appreciation thanks to massive job growth and companies moving in like Intel, Amazon, Google, Honda, Facebook, Microsoft, and LG. Buying a duplex or triplex here could give you great cash flow and diversify your portfolio while keeping one higher-end property elsewhere if you want exposure to a different market. Structuring it this way can balance cash flow, risk, and appreciation potential. Happy to connect and answer any questions you have!



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  • Elise Bickel TauberBusiness Member
    Real Estate Agent · Cranberry Twp · Member since 2017 · 385 posts · 198 votes
    7mo

    I would say Pittsburgh because I invest here and manage for a hundred+ other owners here but honestly, where else can you find a small to mid-sized multi-unit for $1million cash flowing at 15% with good increase in equity year after year? 

    0Reply
  • Nick Robinson
    Rental Property Investor · Murrieta, CA · Member since 2020 · 338 posts · 344 votes
    7mo
    Biggest issue is before you even put your property on the market you should have at bare minimum looked into where you want to invest. I know when I have done 1031's I already have the property identified before escrow or during escrow. Trying to find a 15% CoCr is unrealistic and if you do find anything like that it's probably something that is going to be more headaches than it is worth. My biggest piece of advice is, which might mean eating the tax bill, is to not rush into a bad deal and make your problems worse. 

    On a positive note, I am originally from Lake Forest and graduated from El Toro High School. 
    0Reply
  • Josh C.Pro Member
    Property Manager · Indianapolis, IN · Member since 2010 · 1k+ posts · 1k+ votes
    7mo

    Using that million for a Time Machine is the only way to get 15% coc that not in the absolute hood.

    Then don’t buy real estate at all and buy bitcoin and Tesla stock since you are from the future.

    Had a client tell me the other day he wanted to go with me because of how much we grown and our portfolio. Said he had up to 5 million to place in the next 34 days and only needed 30% returns and we could keep the rest. He said he didn’t care how much we “extra” we made. Skys the limit. He said this with a straight face and was dead serious. 😂 the delusion is real.

    1Reply
  • Ricardo Hidalgo
    Real Estate Agent · Member since 2019 · 569 posts · 257 votes
    7mo
    Quote from @Steven Escobedo:

    I just sold the property in California and I need to do a 1031. I have experience with short-term rentals, but I need to get out of California. Where can I find a property worth 1 million bucks that gives 15% cash on cash? Or should I buy two at 500? Or heck should I buy one of at 500 and buy a duplex triplex somewhere in the Midwest as well?

    The emerald coast as a whole on Cash purchases for a true NOI is around 6-8% return on cashflow with 4-5% appreciation in the current market. I personally own myself and help Many purchase short term rentals in the area. Gross numbers are impressive but NET returns tell another story. Even with high LTV on financing its hard to cashflow and or generate a true net return of 3-5% in current market conditions. New construction if done right is the way to go


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  • Andrew GlissonBusiness Member
    Property Manager · Memphis · Member since 2026 · 135 posts · 95 votes
    7mo

    DST is the closest thing to a legitimate parking strategy. Just never do a 721 conversion if you want to stay in the 1031 cycle.

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  • Denver McClurePro Member
    Financial Advisor · Flower Mound, TX · Member since 2018 · 661 posts · 479 votes
    7mo

    Couldn't agree more with @Andrew Glisson.

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  • Ashish AcharyaBusiness Member
    CPA, CFP®, PFS · FL · Member since 2017 · 5k+ posts · 3k+ votes
    7mo

    Congrats on the sale and sorry I am a bit late to this discussion. With a $1M 1031, you have flexibility, the key is structuring it correctly. As long as you reinvest equal or greater value and replace any debt that was paid off, you can fully defer the gain whether you buy one $1M property or two at $500K assuming you have met the 45 days and 180 days thresholds.

    The bigger decision is risk and cash flow. One $1M STR may generate strong income but concentrates risk in one property and one market. Two $500K properties or a duplex/triplex can diversify income streams and reduce regulatory exposure, especially in markets with stable long-term rental demand.

    From a tax standpoint, multiple properties can give you more flexibility with depreciation strategies. If you materially participate in STRs, accelerated depreciation may help offset other income. If not, passive loss rules will apply.

    I’d model the decision around realistic cash flow, market regulations, debt replacement rules, and your long-term exit plan. The tax structure matters, but the investment fundamentals should drive the choice.

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  • Jeremy MelloulPro Member
    Real Estate Agent · Columbus, OH · Member since 2022 · 84 posts · 83 votes
    7mo
    Quote from @Steven Escobedo:

    I just sold the property in California and I need to do a 1031. I have experience with short-term rentals, but I need to get out of California. Where can I find a property worth 1 million bucks that gives 15% cash on cash? Or should I buy two at 500? Or heck should I buy one of at 500 and buy a duplex triplex somewhere in the Midwest as well?

    Solid option in a better political climate for making $$.  https://www.zillow.com/homedetails/60753-Curry-Rd-Mc-Arthur-...


    380-222-6485
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