All Forum Posts by: Alex Olson

@James Li I would look at your current return on equity. You have $100,000+ tied up in the one property you purchased 5 years ago. By leveraging that $100,000 (plus the other amount you put on that property when you bought) you can buy a nice fourplex here in the Midwest that will cash flow (I would guess) greater than what you have now. And, not sure how much you love this property you currently own but you get more of what you want with your next purchase. I look to maximum leverage. A good calculation to tell you if this is a good idea or not is to use the Return on Equity calculation. I am happy to show you how this works in more detail. 

Have you spoken to @Luther Wilson III? They manage several properties around town and are great local people. 

Kansas City is a great 1031 Exchange market because it allows you to go from your initial investment in a high appreciating area like the Bay Area and in just a few years take your extraordinary gains that you made from the sale and put it in a market like KC and reap appreciation, cash flow, and land lord friendliness (together with low taxes). Of course I am partial to KC but I think a lot of midwest markets are good for this. I have just heard that KC is hard to miss on an investment from a location standpoint but that some growing cities do have many places that need to be steered away from. Hope that helps!

I would invest in a market like KC where you can get good cash on cash returns for your money and appreciation. There are many places in the metro that are in great locations that are affordable. 

@Kyle Keller Yes @Dave Foster is a great QI and knows the system well. What part of the US are you exchanging in to?

@Vlad B. If it were me, I would get them leased up asap and then sell them, perform a 1031 exchange to defer taxes on any gains and buy newer townhouse style apartments that cash flow. I can show you some examples of others that have done this. Tough decision but sometimes it it best to cut bait, get something new, and see if that works for you better. 

 Now would be a good time to 1031 exchange. Read David Greene's book on out of state investing. It will help a lot. If you look to Midwest markets, let me know. 

@Quentin Jivery Kansas City is a great market for almost every kind of real estate investing. A lot of people with 1031 exchange a house, duplex, fourplex or you name it and defer taxes by completing an exchange into Kansas City. I can show you how I have seen it done in the past and why.

@Gina Huerta House hacking and then 1031 exchanging is the ultimate wealth building combo! I have had many clients buy a fourplex, live in one side, rent the other three, and then 1031 exchange at some point in the future into another property. By putting as little down on your first investment and then using the gains tax deferred to buy your next one gives you a nearly infinite cash on cash return. Great work and idea!