You want an investment that pays for itself, including mortgage, taxes, insurance, maintenance, and even some money set aside for a reserve to cover vacancies and capital expenditures.

An annual business tax as a hotel of $50 and collection and remittance of transient occupancy tax of 12% from renters is required of all short-term vacation rental operators.

If the purchase is done in cash, as you mentioned, they’d have more flexibility, but they’ll still want to carefully consider the tax and legal implications of the subsequent sales.I hope this helps, and good luck with your client’s deal!

@Nicole GrazianoI recommend that you have a consultation with a real estate tax accountant regarding your taxes.Bigger Pockets is a great place to find a real estate tax accountant. 

As more people placed more properties in STR inventory, and as more municipalities taxed and regulated the industry, the profitability of the overall industry has reverted to a much more aligned (lower) risk adjusted return.  

Preferably low or no money down as best seller would be one only interested in the monthly incomeI then sell said first property and take that cash to buy the investment I am really wanting and I get the terms I want.only thing I don’t know about yet is, how to dodge the tax on the sale of the initial property?

Thats $7700 a year NOT including my accountant/Tax prep. 

Someone can be a brilliant tax person but horrible to work with, and also vice versa. 

The property was rented and generated $160 cash flow after mortgage, taxes, insurance and property management fees were paid.

Britt,My firm has evaluated some smaller properties (under $500k) in the past for cost segregation, and it generally does not cost justify moving forward, since the benefits are small, and typically the tax liability on the income is minimal if any.