Using a 1031 to upgrade to a two-family could help you reduce or eliminate the $1,000 out-of-pocket expense you’re paying now.Also, condos often come with HOA fees that limit cash flow, so be mindful of their impact.

At the beginning, it may be difficult to get a more expensive property that will appreciate well and so your choice is go with the cheaper property and get cash flow until you can sell and upgrade, or wait for a really good deal which you may be waiting for quite a while and its possible that you will have spent so much time waiting that you could have purchased multiple cash flowing properties by the time you get a good appreciation deal that you can qualify for / refinance after the rehab. i know anyone can go out and get seller financing deals, HML, flip to build capital or whatever the case may be I am just saying sometimes those will be harder and could result in less deals overall. 

Purchase price: $165,000 Cash invested: $20,000 I bought a duplex in Racine that needed a lot of cosmetic upgrades.

Plus you can upgrade inside if needed to get higher rents.

There are a lot of other design upgrades you could make too.2.

Upgrading countertops to granite or quartz, installing high-end appliances, modern cabinetry, and stylish fixtures can significantly raise ARV.

Thoughtful upgrades and efficient project management made this a successful venture, highlighting the strength of our partnership and commitment to delivering high-quality results.

I upgraded the “bones” of the property and the cosmetics.

Northeast near Morgan they are upgrading but is in the city. 

Keep in mind, adding "cute", and upgrading things won't increase your rent or ARV past what the market in that area will tell you is the max.