At least that way the interest payments (she just bought the home two years ago) would go down through decreased amortization...

I was surprised that such a small increase/decrease in rate made such a big difference.  

In addition to the above commentors, If this does become a serious issue, there is one advantage, housing prices will decrease as demand decreases (and therefore supply increases).

@Price KenneyYou want to connect with an accountant who is very familiar with taxation as it pertains to foreign investors.A couple things to consider.1) Depreciation calculated may be different if the ultimate owner is US or Foreign.2) Corporation tax rate decreases with the most recent tax reform made "blockers" more attractive.3) use of a blocker is favorable to many foreign investors as you are not required to file a US individual tax return and not required to disclose all other personal information to IRS.However, all the facts and circumstances should be addressed before preceding so please consult with a competent accountant.

a deal that cashflows negatively $400 now could also turn against you as rents decrease now that we are in a rent bubble. a $400 loss could be an $800 loss soon and not only are you bleeding cash then but your valuation will also plummet. we are in a unique market that isn't sustainable long term.. 

I'd rather list the property with plans to decrease asking price based on market interest.

Population actually decreased, but incomes greatly increased and so did housing prices.

But then the recapture would increase my basis, which would decrease the STCG profit at that point, correct?  

@Andrew Shaffer Are you finding rents stagnant or decreasing due to the new apartments? 

Once the third apartment is rented (I am living in it for one year), my operating cost actually decreases because I have less utilities to pay.