Question: how to 1031 exchange duplexes in a competitive market.

[Bart J. Olson]

I have 2 duplexes in Everett, WA.  One duplex cash flows $1000 and the other about $700.  I bought both as owner occupied.  Im thinking I could probably sell both duplexes around $1 mi and net about $250-$300k to reinvest.

I got married had a child and moved South to Tacoma, WA to be closer to family where I purchased a home with a mortgage of $3250. 

I have total debt of about $85K-$100k and am wondering if selling one duplex to satisfy that debt and rolling the other duplex into a similar property is the best thing to do?  If I dont sell anything, my monthly expenses leave me a little too tight at the end of the month.

My main goal is to increase my cash flow with the money that I have to reinvest.  Reinvesting in MF (4 plex or more) would be ideal, but I run the risk of losing out to the competition that seems to be able to buy at the drop of a hat.  Then that leaves me with the risk of getting hit with the 1031 tax.

Are there other ideas on how to reinvest the money from a 1031 tax exchange to achieve that goal?  Investing out of state/other ventures?

Thank You!