I think arbitrage is a great way to do STR with the high interest rates / inflated housing prices we are experiencing now.

Purchase price: $465,000 Cash invested: $80,000 Checkout my Airbnb here: airbnb.com/h/madeirabeachoasisSalt Water Pool & Hot Tub: $60,000Tiki bar with electrical hookup: $3,500Mural: $1600Interior Furnishings: $6,500Exterior Furnishings: $1,500Monthly gross booking revenue: $8,000-$12,000

When you go to sell, you're subject to tax on the amount of profit between your adjusted basis and sale price, not your purchase vs sale price.Recapture is not repaying the depreciation.

You may think about buying a SFH instead of multi-family if you're working with a lower price point.

How much weight do you give to the cash flow benefit of cheap debt when the property is priced above market?

Purchase price: $189,000 Cash invested: $40,000 Mid-term rental property in a college town.

@Fabio Cattolico"if I could get an out of state property for a great price and the numbers seem promising, wouldn't it be good to start off like that if I'm in a place where buying is unaffordable?"

Purchase price: $465,000 Cash invested: $80,000 Checkout my Airbnb here: airbnb.com/h/madeirabeachoasisSalt Water Pool & Hot Tub: $60,000Tiki bar with electrical hookup: $3500

However, given the price points in NYC, I am looking to southern CT so that I can start small for my first project.

One veteran buyer remarked to me that he didn't get any properties because the prices were so high.