1031 exchanging 150k down into Indianapolis. SFH's or Apartments?

[James R. Copeland]

So I'm strongly considering selling a rental property in Vancouver, WA where the equity is now over 150k and doing a 1031 exchange to buy property/properties in Indianapolis with no plan to occupy it. I already partnered with some folks down there to buy one place that we rehabbed and rented, but now I'm wondering about whether or not it would be better to 1031 this equity towards multiple single family homes or if I should try to go the commercial route and look at one 5+ unit property in that area.

Already know a good manager, just wanted to get a general consensus from other investors who maybe have dabbled in that market at various scales.

[Grant Anderson]

We have done a couple 1031 exchanges over the past couple years replacing properties that we sold from about $250,000 into 3-4 properties in Indianapolis. The only issue we find is being able to locate that many deals in the allotted 45 days. In a 1031 exchange you have to use all the cash you receive and replace the loan to avoid all taxes, so it really depends on how much you would be selling the current property for. If you are selling it for more than $250,000, it may be difficult to find the number of single family properties needed within the 45 day timeframe. A multi family property may be easier to find.