New build twinhomes using money from 1031 exchange

[Deidra Swenson]

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $379,800

New build twin homes, one level living. Built both sides but are owned as separate units. We sold our first house which we purchased in 2007 and kept as a rental and exchanged the money into this property.

What made you interested in investing in this type of deal?

One level living in this area has become more desirable. We needed to find a deal to do a 1031 exchange. New construction was enticing because it would be a low maintenance property to manage. The house that we sold for this exchange we bought in our early 20's as our first home. We kept as a rental for 11 years. Over that time it cashflowed great and appreciated significantly. This was a great time for us to sell and put this money into a new property.

How did you find this deal and how did you negotiate it?

Our realtor at the time knew about this new neighborhood being built and suggested it.

How did you finance this deal?

1031 exchange

What was the outcome?

These two units have worked out great as rentals and have been very easy to manage. Everyone loves the newness of them and the finishes.

Lessons learned? Challenges?

New construction can be a good option if the numbers work out.