All Forum Posts by: Account Closed

@Dave Foster confirming PITI and the $100k "equity" is $50k my down payment and $50k appreciation. Rental 2 is next door to a major new town center that just broke ground so I am expecting appreciation there soonish.

All around it sounds like confirmation I just need to do the 1031 on rental 1.

Happy to take any advice on reading or finding qualified intermediary, etc.

@James Galla no argument from me that it's not the best situation and trust me, plenty of lessons learned! They were both purchased as a primary residence and I decided to rent them instead of selling focusing on the equity build since my job's income was more than enough back before I had a wife and child!

I was talking about Federal so sounds like you're saying I understand the tax situation wrong. Will do some more digging today.

I've got 2 rentals and a primary residence and what feels like no way forward. Rental 1 is worth roughly $350k with $100k in equity and $30k depreciation recapture. Rental 1 rent is $1800 and mortgage $1600. Rental 2 is worth $400k with $20k in equity, no depreciation yet. Rental 2 rent is $2000 and mortgage is $1800. New tax law limiting write off on interest ($10k a year which we hit with primary residence alone) means my rentals are costing us close to $900 a month in taxes making our properties cashflow negative. I've considered refinancing Rental 1 but my ROI is only 6% so I'd like to move all that equity if possible. Rental 2 was purchased as a primary residence with a VA loan so I'm mostly just stuck with it to avoid losing money on selling costs. I just learned a 1031 has to be upwards. Doing a 1031 upwards on Rental 1 makes me nervous because it would be a huge deal and I've never done a 1031 before. Is a 1031 my only option to fix my cashflow issue? Should I incur the costs of refinancing? Should we just try to stick it out?