If substantial renovations or capital improvements are made in later years, those improvements may qualify for new bonus depreciation.3.

Please consult with an attorney that is familiar with 1031 exchanges.If you move into the farm after two years and later sell it, capital gains will be prorated based on investment vs. primary residence use, limiting your Section 121 exclusion ($250K single / $500K married).

As a due diligence footnote - a few submarkets are prone to severe flooding.Nearby Frankfort (state capital) is seeing growth.  

Just be mindful that you can't 1031 a personal residence but it might be eligible for capital gain exclusion from section 121.

I'd work on a strategy that returns my capital guaranteed. build to rent direct with ground up developer does this.

So after speaking with our cpa we have decided now will be the time to sell and avoid capital gains tax ! 

In addition, you would need enough working capital to pay for insurance (which will be going up a LOT in Los Angeles) and to pay for property taxes.Don't buy this unless you have substantial resources and a cash cushion to keep yourself safe.

@Natalie Tran How do you know you will lose 50% of your capital? 

I work with a credit union that does HELOCs nationally.

If you like impacting the nation by providing affordable housing you can really put people in houses here.