The current tax code provides special benefits in this situation.When the original owner passes away, the "basis" of the assets resets to the market value at the date of death.In the US, there is currently an estate tax exemption of approximately $13 million per person, which allows the basis to reset, and depreciation can start anew.This “step-up in basis” is particularly useful if the next generation wants to sell the asset.Since their basis is set at market value, if the property is sold at that value either at the date of death or within six months, there is no capital gain and no taxable event.There have been many examples where portfolios of fully depreciated real estate worth tens of millions of dollars have been passed down from one generation to the next, resulting in little to no tax liabilities for their heirs.Pretty cool, right?

My plan is to begin next spring.That said, I found a completely gutted home a few hours from me and gave my first attempt at analyzing the deal, estimating rehab costs, and projecting ARV.

My estimate of 15% always ended up being higher, but hey, what's it going to hurt to be more conservative.

It’s especially advantageous that your construction costs are lower due to being a builder, which really boosts the overall profitability of the project.The numbers look strong, especially with a refinance at 5.9% the $24k net after expenses and $12k yearly pay down show a solid return, even with conservative estimates.

Approximately 8 years ago I was introduced to the world of multi family real estate.

Where are you getting the mortgage estimate from?

They are only getting an estimated 40-60 cents for every dollar they spend.

Which is why the cost increases by approximately 300%.  

We're signing 3-5 year escalating commercial leases, which is awesome.Generally, what we've been estimating is that if this is a pretty nice residential assisted living home, that we will get $800-1100 PER resident. 

So, if I budget 5% for vacancy, I can readily beat that budgeted estimate.4.