Turning a $10,000 down payment into a $1,400,000 complex

In this deal we helped the buyer 1031 exchange their duplex for a $1,400,000 property that consisted of 8 apartment units and 38 storage units. The buyer was able to do so while starting with only $10,000. Years earlier this buyer used their FHA loan to owner occupy a duplex with a $10,000 downpayment. They lived in the property for about a year and made some upgrades to it while occupying. They moved out and rented out the unit they were living in and held the property as a rental. Then they waited and let real estate do what it typically does, appreciate. By holding this property and letting it pay for itself, it had increased in value and paid down the loan to create enough equity for the downpayment on the next property. We located the next investment for our client and set them up with the 1031 exchange. The clients plan is to repeat this process again and 1031 into another larger asset.