You must hold the property for 12 months for it to be "qualified" for a 1031 exchange. However be careful with that and consult with you professionals such as a CPA and QI. There is no finite holding period for property to automatically qualify as being “held for investment.” A lot of advisors and CPA's will say two years is sufficient, but it's dependent case by case.
You can't put the proceeds of a sale of property that has been held for under 12 months into a 1031 exchange. The IRS will not see that property as held for investment purposes. But once again, consult with a CPA.
Under the 3-property rule, the investor taxpayer can identify up to 3 properties, regardless of the fair market value of the properties. You do not have to acquire all 3 of the properties that you identify if you utilize this rule, but you will need to close on at least 1 of the properties. If you are intending to diversify your real estate investment dollars, for example by investing in DSTs and want to identify more than 3 possible investments, then you will choose to not rely upon the 3-property rule.
