Newbie and question about potential 1031

[Dan Stevens]

Hi.   We have a condo that's worth probably $1.3m in LA about 20 minutes from our primary residence.   Have about $1m in equity in it.    We have an opportunity to potentially do a 1031 for a single family house near where we live (with an apartment in back) for $1.5m   Currently we get $4k for apartment with little fuss.   Realtor thinks we'd get $6k conservatively for house and apartment in back.  

I would never consider buying the house for $1.5 (think everything is overinflated) if we weren't going to buy it using an inflated asset (condo).   The advantages would be getting the land from owning the house and the flexibility that comes with it compared to a condo.

Thx for the help!   

[Robert Reynolds]

Hi @Dan Stevens,

I see no issue to 1031 into a house with an ADU in the back if the numbers make sense. I live in Westchester and an ADU can easily rent for $2-$3k a month and a house could get $5-$8k a month. You would have an asset in a better location, with possibly better tenants and making more cashflow.