We did that for about 3 years until Jeff informed me he'd fallen behind on property taxes, and all of his lenders called the loans due.

You are afraid of rent control, but if you add an ADU and it is detached, the main house (if built prior to 1978) may eventually become subject to LA Rent Control. 3.

Use tax benefits like depreciation, repair deductions, and tax-free refinance proceeds to offset income, and consider an LLC for liability protection.

The property tax is higher than other markets, but generally, the numbers still work. 

If you can rent it for enough to cover the principal, interest, taxes and insurance and still put money in your pocket, plus cash flow on the property you're purchasing, that would be ideal.

If you need financial help, ask under the "Finance, Tax, and Legal" forum.

I understand that I need to account for taxes, insurance, and other costs—Should I go with a LML and then do a refi later on?  

You mentioned gross rents of $3400 per month and Principle/Interest/Tax/Insurance of $2500 per month. 

Hey @Nevin Wilkie. have you looked on the city or county's tax records to find the mailing address for the owner when it's different than the address of the property you want to buy?

For tax purposes, rental income is generally recognized in the year you receive it, not when it is paid.