We plan to consult a tax professional but I wanted some general thoughts and considerations prior to that meeting.

On top of that, the profits seem to be higher due to less costs.

If so or if you have worked with permits, please provide more details on cost & time line.

Given that many people have said the average price to build in California is $200 and above per square foot, I became worried.Do you think building a 2-bedroom, 1-bathroom home measuring 550 sqft is feasible at this cost?

The seller did not realize there is a cost to lock in rates.

Next, figure out how much the entire rehab will cost and contrast it with the possible rental income.

Consult with a tax advisor for specific advice.Transition to Primary ResidenceLease Agreements: When renting out the property, consider the timing of lease agreements to align with your future move-in plans.

As an out of state investor, I made the decision to pull my equity out as construction costs in the area are incredibly high with limited availability right now.I completely agree that luxury rentals would be my prime target for a 1031.

What does something like that cost?

I'm just curious...I'm here in CA, and with the cost of housing, I'm always wondering if my home is too large and if I should be finding other ways to invest my money, such as buying rental property (2 town homes instead of a house for example) and moving into a house later.