Need some advice!!

[Michael Rinde]

Hello everyone! This is my first post, and I'm in a little situation and trying to determine the best course of action. My wife and I own a condo in an awesome area, but no where close to where we live (we live in the Lehigh Valley of PA and the condo is in Atlanta, GA). We have great tenants, but with the massive increase in taxes in that area as well as the HOA climbing at $50-$80/year, a once incredible rental property has begun to lose us money (I will NEVER buy in an HOA again). The condo has appreciated immensely since we purchased it so we are thinking of doing a 1031 exchange. The issue, as you all know, is that with housing prices and interest rates where they are, I am being extremely particular about potential investments and as much as I would love to find something in my area that's a tri-plex, quad plex, or even a 5+ property, those are extremely slim pickings in my area, and the 1031 doesn't really give you a large window of time so I can't exactly wait for the "no brainer" property to come along. The thought I had was using my current primary residence (3.25 interest rate, $600+ differential between the mortgage payment and what we could rent it for) as an income property and purchasing a new primary residence. The key in that though, is purchasing a fixer upper so that we can take all of the gains from selling the condo and sink it into that new property. I'm going to want to refinance that new property in a a few years when rates come down anyways, so after all of the updates and upgrades to the new property our equity could sit their safely for a few years until things improve (hopefully!) Then we can cash out refi or HELOC and have a similar chunk of money to get back into investing in other properties in a few years. Thoughts, suggestions, even tough love/constructive feedback is welcomed! Thank you in advance!

[Jaycee Greene]

Quote from @Michael Rinde:

Hello everyone! This is my first post, and I'm in a little situation and trying to determine the best course of action. My wife and I own a condo in an awesome area, but no where close to where we live (we live in the Lehigh Valley of PA and the condo is in Atlanta, GA). We have great tenants, but with the massive increase in taxes in that area as well as the HOA climbing at $50-$80/year, a once incredible rental property has begun to lose us money (I will NEVER buy in an HOA again). The condo has appreciated immensely since we purchased it so we are thinking of doing a 1031 exchange. The issue, as you all know, is that with housing prices and interest rates where they are, I am being extremely particular about potential investments and as much as I would love to find something in my area that's a tri-plex, quad plex, or even a 5+ property, those are extremely slim pickings in my area, and the 1031 doesn't really give you a large window of time so I can't exactly wait for the "no brainer" property to come along. The thought I had was using my current primary residence (3.25 interest rate, $600+ differential between the mortgage payment and what we could rent it for) as an income property and purchasing a new primary residence. The key in that though, is purchasing a fixer upper so that we can take all of the gains from selling the condo and sink it into that new property. I'm going to want to refinance that new property in a a few years when rates come down anyways, so after all of the updates and upgrades to the new property our equity could sit their safely for a few years until things improve (hopefully!) Then we can cash out refi or HELOC and have a similar chunk of money to get back into investing in other properties in a few years. Thoughts, suggestions, even tough love/constructive feedback is welcomed! Thank you in advance!

Hey @Michael Rinde, welcome to the BP Forum! What do you think you can sell the condo for now? The trick with 1031s is the "newly purchased" property needs to also be an investment property rather than a new primary residence.