There are still a few more properties in the city we are going to sell and exchange for homes in the suburbs (better tenants, higher rents).

Securities and Exchange Commission (SEC): - https://www.sec.gov/complaint/select.shtml3.

As your portfolio grows, explore 1031 exchanges to defer capital gains, HRAs for tax-free reimbursements, and Real Estate Professional Status if you become more active in real estate.You’re thinking strategically, and that will serve you well.

You cannot sell first and then start a 1031 exchange.

All-in basis: ~$65,000Estimated retail value: ~$110,000Rented for ~$1,000/month for two yearsTenant eventually purchased at a price we were happy withProceeds were rolled into a better property via 1031 exchange Lessons learned?

If you buy a deal from a motivated seller for a really low price, understand that you are trading places with the seller in exchange for money.

Then again, purchasing a true "turnkey" property means you are typically paying a higher premium in exchange for someone else delivering you a cash flowing, low maintenance asset.I would gander to guess that 99% of people do it the latter way you described. 

If you do a traditional cash out, the money is tax free and your tenants are paying it down.If you sell, you can do a 1031 exchange into a new property, but then that doesn't necessarily free up the cash, unless...You take the net proceeds and buy a new property cash.

After I started to realize this about 10 years ago we did a portfolio-purge and exchanged all properties that were at elevated risk of higher turnover, unpaid rent and damages.I often get questioned about our approach to finish basements and add a bathroom, because we don't get much higher rents for adding these features.

. - Over the long term, buy-and-hold investing opens the door to advanced strategies like 1031 exchanges (defer capital gains when trading up), pairing rentals with your retirement accounts, and even structuring entities for tax savings once your portfolio scales.Starting with cash-flow rentals is smart, because while they build equity, they also create consistent deductions that ease the burden of your current 1099 income.