It can take a year or more to complete an ADU.

Once you have completed the consolidation portion of your 1031 exchange you now own a more expensive (and probably really nice) property that it must be your intent to hold for investment use. 

@Kerry Hermann - the posts by @Michael Ewers and @Samuel Coronado were solid advice (I don't know Nita Cook whom Sam referenced, so that's the only part of his post I can not comment on).I second what Michael said about the market here - it was fantastic from 2017 (when I started) through 2022 - then it really started to crater in 2023 (although we still found some deals), and the bottom completely dropped out in 2024 (found one small commercial deal and one residential flip deal in 2024 - that's it). 

Does this completely prevent the tax lien holder of getting additional gains after foreclosing? 

My goal is to build a data-driven tool that provides actionable insights into which neighborhoods and property types are in the highest demand, based on metrics like:Time on market: How quickly rentals are being leased.Property characteristics: Bedrooms, bathrooms, size, and amenities.Pricing trends: Rental rates relative to market demand and property features.Visual quality: Leveraging property photos to analyze the style and condition of rentals that perform well.The tool will allow users to:Pinpoint areas with the fastest rental turnovers.Understand what types of properties (size, price range, features) rent the quickest.Gain deeper insights into property presentation and amenities that correlate with high demand.Thank you in advance for your feedback.

I started with two remodeling projects and have since completed three new construction projects.

Long story short, the properties were far from turn-key and required that I find an out-of-state contractor and property manager to complete renovations and find new tenants. 

People staying for 30-90 days are a completely different customers than someone in a years lease. 

However, as we delved deeper into the project, we realized that a complete remodel would be more beneficial.

However, as we delved deeper into the project, we realized that a complete remodel would be more beneficial.