Some will want to be on your team, and some will want to split profits with you in exchange for funding your deals. 

Start building close to home and you'll have such great appreciation by the time you're ready for the cash flow to be $20k a month you can exchange out of the low cash flow, high appreciation California market to wherever you decide to retire. 

You are fortunate to be able to do a reverse exchange.

I remember working with a client a couple of years ago who wanted to do a 1031 exchange into Phoenix multifamily.. they had some numbers in mind, but no framework beyond “I want more doors.”

Just note that you guys may end up in what I call the "1031 exchange until you both die" cycle.

They have several other LLC's such as Home Partners that purchased properties at low prices and then quit claimed them to Guardian and then Guardian sold them to people who needed to 1031 exchange money into another property.

If you are going to be doing the rehab work in exchange for equity then that value needs to be determined up front with a specific timeline that you have to adhere to in order to earn your equity.

I took no money from the cash flow (when there was any) and I never made a late payment to the bank.This fall, nearly 12 years after the bank gave me that house, and over 15 years after I knocked on that door - after evictions, vacancies, insurance claims, and never taking a dime out of it - I sold that house and placed all of the proceeds in a 1031 exchange.

Is it possible to do a 1031 exchange and use the proceeds to buy a house using hard money, then refinance into a long term loan?

@William Bohan, Yeah, being a CA resident you'll have to do a 1031 exchange or your tax will approach 40%.