Keep, sell or 1031???

[Rob McDonald]

I have 2 properties I'm thinking about either selling, keeping or doing a 1031 into a better performing property. One is worth about 300k, with 100k owed. The next is worth about 200k with about 35k owed. After selling costs I will have roughly 330-350k in equity. Property A (300k) rents for $1550. Property B (200k) rents for $1125. I know these are very rough numbers but from a back of the napkin approach I would do better to move this equity somewhere else, right? I think I'm emotionally tied to them because I've had them for so long. 

I've been reading that it's very hard or impossible to reach the 2% rule these days and even getting 1% is difficult. I'm only at 0.535% which seems very low. What are you guys getting these days in regard to the 2% rule? 

[Jacob Sampson]

Whether you can get 1% or 2% just depends on the area you are investing.  For example, I would be overpaying if I went as high as the 1% rule.  Recent example, I purchased 2 fourplexes that generate a total of 5k a month in rent for $290k.  We had to put about 10k into the buildings.  For my area this is considered a standard to good deal.

As far as 2% rule I have never seen any that are in areas I wanted to invest in, but in other states that may be different.

So, IMO I would be interested in getting into assets that cash flow better (or that cash flow at all).  I would lean toward a 1031 exchange as you likely have a ton of capital gains tied up in them.