1031 ---> BRRRR Can I do that??

[Tait Duryea]

Hello Bigger Pockets family!!

Hoping to bounce an idea off some people here... I have a condo in escrow as of yesterday in the Seattle area. I bought it a few years ago for 54k an it's in escrow at 142k. Nice gain!

I'm planning to 1031 it into a duplex/triplex/quad in Reno... I'll have about 85k from the sale plus roughly another 20k of my own capital to invest. I'm working with a recommended broker, and with a lender on getting pre-approved. I'll also be flying up next week to put together the rest of my core four: property manager and contractor. (I live in Honolulu).

So, that was the plan until taking a closer look at the BRRRR method.. and I don't know. Would it be smarter in the long run to just pay the capital gains tax, and start BRRRRing properties there?

Can I 1031, AND use hard money to buy for cash, renovate then refinance my initial capital out to sort of hybrid both methods? Or would that be against the rules?

Thanks for any ideas or input. I really appreciate it!