All Forum Posts by: Jerry Chen

Oh man, I just saw this thread today, and the conversations here are just too funny!  Investors from outside of California probably don't realize how crazy the RE market here, especially in the Bay Area.  Why not have a more balanced portfolio, bought couple of cash flow properties and get somewhere around $1500ish cash flows from those properties per month, and put them into an appreciation property that is not cash flowing (or negative cash flowing), if you can have an overall break-even, then it's a win!!! Winning on the appreciation, winning on the tax benefits, and winning at the increasing net worth year over year (if you have a fixed interest rate 30 year mortgage loan) as your debt goes down and rental income goes up!   

Hi, I have some questions on 1031 exchanges that I need to know before I make my next investment decision and I'm hoping somebody can help me with.  Here's my situation:

I have two investment properties: A condo which I bought for $95K free and clear in 2009 and used it as a rental property.  I later on did a cash-out refinance for $125K in 2016.  Now I have a mortgage of $125K and the condo is worth around $325K.  Is it allowed for me to use 1031 exchange to purchase a duplex for around $200K?  Assuming after all the fees and costs associated with the exchange, I still have to pay $25K out of pocket.  Will I have to pay an additional capital gain tax?