Selling my ca rental to invest out of state

[Tanner Marsey]

Good evening. Wanted to run a scenario by you guys. I have a condo in Huntington Beach, ca that I currently rent out for 2500 a month. (Slightly under market but it’s a coworker that rents it and it’s hassle free so willing to take the monetary hit). 400/mo hoa. Roughly 450/mo property tax. It’s worth about 450k. I owe 317k on it. Recently been toying with the idea of selling it and trying to obtain multi unit properties out of state. 

Pros: monthly cash flow, a vacancy won’t hurt as bad, increase in rent across all units results in a notable increase in cash flow. 

Cons: out of state. Property management. Higher/more frequent repairs etc.... 

thoughts....? Suggestions? 

Thanks! 

[Dave Foster]

@Tanner Marsey, whether you go into a fully owned asset or a fractional like @Mel Hayes is suggesting you can 1031 into either deferring the tax either direction.  However if you want to defer all tax you'll need to purchase at least as much as the net sale and use all of the proceeds in the next purchase or purchases.  So while you don't have to take out as much debt as you paid off in the sale you do need to reinvest that much whether it's new debt or you fill in the amount with cash of your own.