Sometimes (talk with your accountant) a loss in real estate can off-set income in other areas.Let us know what you decide and how it works out. 

At the current rents, I think it would be a loss.

I’ll be out of state, which I know is a big red flag for many.Well below 1% minimum of Rent/Property ValueHoping to self-manage (Yes, another big red flag)Loss of capital gains exclusionMONTHLY SUMMARYRental Income $3,500Less ($3,440) Mortgage (2,900) HOA (390) Rent Ins (150)Less ($1,155) Property TaxTot Exp ($4,595)Rev: ( $1,095) !!

So that will be vacant and having losses during rehab.

I’ll be out of state, which I know is a big red flag for many.Well below 1% minimum of Rent/Property ValueHoping to self-manage (Yes, another big red flag)Loss of capital gains exclusionMONTHLY SUMMARYRental Income $3,500Less ($3,440) Mortgage (2,900) HOA (390) Rent Ins (150)Less ($1,155) Property TaxTot Exp ($4,595)Rev: ( $1,095) !!

Unfortunately their home was a total loss due to a tree falling, so I have agreed to rent them my STR as a long-term furnished rental while their home is being rebuilt. 

They indulged in luxurious residences, high-end vehicles, and extravagant vacations, all while their investors faced mounting financial losses.

My cash out will be 66k, which is very exciting, but I will need a 16% return to justify the loss in cashflow. 

You quantify losses due to withdrawing your 401k - then you leave the real estate investing completely vague.

Say you start a STR and use the loophole to write off 100k from W2 salary. 2 yrs later the rental goes underwater and you have to give it up at huge loss.