The plan is to keep operating the property as a PadSplit post-acquisition.

I've been doing this 20 years, so know how to operate these.

You also have to build in holding costs, investor capital, operating costs etc.

One thing to consider since you are a California resident investing is the compliance requirements for LLCs incorporated in California or operating as a foreign entity here - the rules here are different than most states.  

There are also additional costs of operating and maintaining an LLC, like separate bank accounts, annual report filings, tax filings, etc.2.

Now have a portfolio of 6 properties with some that are owned others just managed but turn key operation for sure. 

However, they approach financial health from different angles.The 50% Rule is a quick estimate that suggests operating expenses (excluding mortgage principal and interest) will roughly equal 50% of the property's gross income.The DSCR is a more precise calculation (Net Operating Income / Total Debt Service) that determines if a property generates enough income to cover its debt obligations.Deal example:- Class C middle class neighborhood- 4bd / 2ba single family house- ARV: 190k- Purchase: 105k- Rehab: 35k- Market rent: $1,400-1,525- Section 8: $1,475- Property manager: 10%- Taxes: 125 month- Insurance $1250 yr- HOA: $55 month- purchased and rehabbed with all cash.

For us STR hosts, I know we are very conscientious about guest experience and I want to be proactive about doing things to ensure my business operates successfully.Thanks!

This will create your new basis.From an operational perspective, you might want to touch up a few things on the place to make it more rentable. 

Hi Richard, Do you currently own/operate LTRs?