A friend of mine invested in one last year—apartments upstairs, a small coffee shop downstairs - and the combination of income streams made it a steady performer.Scaling with a 1031 Exchange:While not applicable unless you sell a property, planning for a 1031 exchange could help you scale quickly while avoiding capital gains taxes.

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.

It's hard to harvest equity on these plays, unless you commit, long-term, towards very light leverage, as the only practical ways to benefit from the equity in your portfolio, if you plan to never sell it, only exchange it, for a lifetime, are to spend the cash flow, or cash out refi.

We sold a 2 bedroom condo in San Diego that would rent for about $2K (my daughter lived in one room, exchange students paid $1K/mo) and were able to buy 3 homes in Coos County via 1031.   

., deductions, 1031 exchanges), could potentially outweigh your current W-2 salary over time.Suggest a trial period for the first deal, involving him in decisions to build trust and confidence in the process.

The owner wants to sell for a 1031 exchange, and the property hasn’t been officially listed yet.

I have to agree that a 1031 exchange may not be the best strategy. 

A nice home that may some day make a bad rental but a good primary home An exchange in to a state without state income tax to save that 10% in state income taxes.  

(5 tenants are original tenants, having been in the homes since I purchased them 9-12 years ago when I was doing more buying.)My last purchase was a 1031 exchange in September of 23 for a new build. 

Keep in mind that accelerated depreciation increases recapture tax (taxed at up to 25%) upon sale, though this can be deferred with a 1031 exchange.