DNR pays close attention here as well.

They pay themselves good "salary" from the loans they get.

From what I understand, a 1031 exchange doesnt apply in this case, and so I will have to pay short term capital gains on the appreciation ?

I'm assuming I would have to pay it off if I won the house. 

The seller's LLC pays capital gains tax and depreciation recapture, while the buyer's LLC uses the purchase price as the new cost basis.

The price you pay for being part of the Disney World spoon-feed of guests is that the barrier to entry for profitable STRs (ones that leverage close to or max LTV) is very, very high.  

regarding roofs  pray for hail storms and then replace .. in those type assets that are really priced for cash flow.. values will rise only when rents rise.. as non of them will ever go owner occ.. at least that is generally what happens with this type of housing.. the value play is the tenant pays off your home and your home generates enough cash flow to break even at best and feed it a little bit over time.. then at the end of your mortgage term 30 years you now have say 2 mil of paid for assets the real money is made on these assets cash flow wise ONLY if you pay cash IMHO

One would think that a bidder would pay $45,000 in my example (since they are assuming the first mortgage), but they are actually bidding $225,000.

I think the folks that pay for these programs have the wherewithal to simply cut a check and its no big expense to them compared to what they stand to get out of it. 

I think seniors would pay more and be easier on property, but I'm looking at both populations.