Cleveland, Baltimore, Toledo, Indy etc....You will see net population decreases in most of these areas but these are the areas where the prices are the lowest in the USA and come with rents that are very high when compared to the sales price.

Purchase price: $35,000 Cash invested: $15,000 Sale price: $80,000 3/2 SFR with shop sold in 2021.

I tell people the harder it is to zone your project, the less chance a competitor will come nearby.

@Placeholder PlaceholderOne word of caution I would advise: If a community or local government is enacting restrictions and also regularly enforcing them, then its often a reflection of the local community sentiment which increases the chance of a neighborhood or nearby resident calling you in if they think you may be running an STR.

If the sale is for $600K then you need to purchase $600K of replacement investment real estate. 

You could also do a cost seg on the $500K sale which depending on what the dirt is worth you can take a large deduction year one of renting it. 

I used Roofstock to sell one of my rental properties in TX as their sales commission is lower than going through traditional sales channels. 

If I put myself in the shoes of the outside partner/investor friend, I would be very concerned because: 1) unclear and/or potentially conflicting business plan, 2) even with clarity in the BRRRR business plan, unclear in the viability of pulling it off with these market conditions, 3) the chances of dispute seems very high, especially if you're going to live in. 4 years ago, I went through a  similar thought process when purchasing an investing property with mainly my family money, while considering an outside investor to rehab for higher STR ROI... 

You could force the seller to bring it up to code before the sale is complete as one of the contingencies of buying it, let them deal with it.

LLCs are a legal tool, not a tax one.Transfer from personal name to LLC/Due On Sale ClauseIf one is transferring property title from personal name, a Grant/Warranty Deed would be drafted/recorded to transfer title.