For example - say you're a limited experience owner/operator buying a 30-unit deal in downtown Seattle (a Freddie Mac SBL "Top Market").

I think the biggest challenge is making sure you have systems and operations in place early on.

Remember the LLC can be deemed worthless if you fail to operate your business in accordance with  with the operating agreement.

Please respond only about Grocapitus deals, not ones from Neal's previous operator or general comments about him or his underwriting methodology. 

The market I operate in is Denver CO.  

We have done that a number of times, it is great once you have everything completed for the home to be licenced and you find a great operator.

Legal ConsiderationsFair Housing Laws: Ensure your reasons for denial comply with the Fair Housing Act, which prohibits discrimination based on race, color, religion, sex, disability, familial status, or national origin.

I just think it is vital to have some boots on the ground in the city where the investment property is, especially for smaller operators. 

In this situation, it’s important to approach the tenant professionally and review the terms of the lease to make sure the rent increase was properly communicated and complies with local laws.

By correctly classifying your property, you can ensure that you’re complying with IRS guidelines and maximizing your tax benefits.