How does 1031 exchange works.

However, precise execution according to IRS rules and clear documentation in the divorce decree are crucial to ensure it qualifies for tax-free treatment.

About half the time the investors bought something really crappy in a bad area and the experience you describe will be repeated over and over.The other half of the time this is just bad luck and things turn around because the property is in a decent area.It's really hard for anyone to know which situation you fall in because we don't know where the property is located (precisely), what exactly you've been doing in terms of repairs and maintenance, who's managing this property, etc. 

Cash-out refinancing can be a great way to leverage equity, but there are other strategies you might want to consider to hit your goals faster.1.1031 Exchange: Rather than just refinancing, you could trade up to larger or better-cash-flowing properties tax-free through a 1031 exchange.

@Matthew Irish-Jones I thought I had to reach precisely 30 sub $100K houses that meet the 1% rule which will equate to $250 in consistent cash flow each month per house.

@Bradley Hendrix, You can allocate the proceeds any way you want, as long as you purchase at least as much as you sell for, and use all of the proceeds in the 1031 exchange.You could sell the apartment and purchase Two SFHs with a 1031 exchange. purchase one for cash and the second with debt.

It is precisely because of mentoring programs that teach strategies and techniques to people who do not have any grasp of the three afore mentioned fundamentals that we have such a mess with “wholesaling” and “subject to” that governmental authorities are figuring ways to heavily regulate or outright ban these activities in the residential real estate field. 

Zillow’s Market Reports: These show market appreciation trends across different cities, helping you spot high-growth areas.5. 1031 Exchange:If you sell your current property and reinvest in a higher cash-flowing property, you may want to consider a 1031 exchange to defer capital gains taxes.

Consider bringing in a partner who can help fund the rehab in exchange for a share of the profits.

Just sold my 3 unit and did a 1031 exchange into a 6 unit.