As you know its near impossible to find a good cash flowing deal in CA due to sale price, taxes and lack of inventory.Last one I closed on was over off of Germantown Road it was a great 2 unit that needed a little TLC for $160K but passed an inspection and was livable.

I again state the problem is with the underwriting.  8.5% vacancy, pm 15%, 25% turn over (using my reduced numbers) or 37.5% using your actual, my minimum maint/cap ex would be 50%, prop tax, insurance, missed payment (seeing my vacancy only included the one month turn over), P&I?

@Dave Stokley@Lisa Marie@Dan Heuschele@Cody L.

Other advice, especially that pertaining to tax benefits, is also highly appreciated!

The rest, put you on near-worthless drip campaigns, don't understand calculating the offer price based upon rents - property taxes - insurance - MNT & Vacancy percentages, etc.DM @James Wise to schedule a chat with him!

I had constant issues with the local government and the taxes were absurd.

Conversely, if new houses are being built frequently, older properties may struggle to maintain their value.Property taxes also play a significant role.

You filed two full year tax cycles and the numbers are similar (no greater variant than 1%) they maybe yes.Generally depreciation is added back as income BUT only the 40% portion you own not all of it.

You might even want to setup a C-Corp (for tax and liability reasons as well) to manage the business with the guests and pay rent to your LLC. 

Note I strive to minimize cash flow because it gets taxed versus other RE return are easy to defer or avoid the taxes.