1031exchange into 1 high end rental.

[Jeremy Mulvey]

Well the time has come to sell my flip/lease option(my strategy now would have me keeping it as a rental but its a been on a lease option so its not gonna happen). It qualifies for 1031. I found a great rentable house in a desirable neighborhood that I will be paying pretty much full value for and the timing will work out perfectly to take advantage of this 1031. I will be transitioning about 70k in proceeds into the new home worth 270k and of course this includes my rehab costs that I won't be able to take out. Now this leaves me with some decent cash flow in the new house and what will hopefully be a high end renter thats gonna take care of the place. Now some may call this a bad play in regards to building a rental business. But I'm big on location and equity growth plus buying rentals that I would live in. My plan would be to take out a HELOC to use for future buys. Am I focusing too much on making this 1031 work? One option if i didn't 1031 would be to move into the new home and rent my current home to get a better rate on the loan. Any advice on this situation for someone who would like to build a large rental business?

Thanks!