You want to be able to demonstrate that your intent in purchasing, subdividing, and improving was to hold for investment use. 

At the same time, someone else reduces your debt, and you get to use the tax code to improve your tax situation legally.  

pid=2141Houston Real Estate Highlights for December and Full-Year 2024:-Following two consecutive years of declines, single-family home sales rebounded in 2024 with 85,163 single-family homes sold compared to 84,038 in 2023 an increase of 1.3 percent; -Total property sales for full-year 2024 were statistically flat at 101,864 units while the total dollar volume increased 3.1 percent to $41 billion;-December single-family home sales climbed 16.3 percent year-over-year with 7,162 units sold;-Total December property sales increased 13.6 percent to 8,478 units;-Total dollar volume for December rose 20.5 percent to $3.5 billion;-The single-family home median price edged up by 1.3 percent to $334,290 while the average price increased 5.0 percent to $425,150;-Single-family homes months of inventory expanded to a 4.0-months supply;-The townhome/condominium market experienced declining sales throughout 2024, and in December, volume declined 5.8 percent, with the average price up 2.5 percent to $268,152 and the median price statistically flat at $234,250;-Townhome/condominium inventory improved from a 3.5-months supply to 5.4 months.

We invested $55,000 in key renovations, focusing on modernizing the interiors, improving curb appeal, and ensuring the property met market expectations.

However, after renovations, the numbers improve significantly, and the challenge lies in bridging the gap between current and future performance.Expenses typically run at a 30-50% expense ratio for mobile home parks, depending on management and infrastructure conditions.

It will help you adjust your pricing to improve your vacancy rate. 8.

If there is minor rehab (such as painting and cosmetic improvements) you can still close on a DSCR loan, however it may affect your appraised value, which could also affect your market rent if its a vacant property.

What drew me to Detroit initially was the potential for strong cash flow, but I’ve also seen appreciation in several of my properties as the city continues to improve.

That alone was the biggest improvement for my business practices and allowed me to take all of my bookkeeping in-house and eliminate the expense I was shelling out for a bookkeeper.

As others have said, the best thing your son can do is run far from this deal, buckle down, save his pennies (he probably already is doing this), house-hack, and improve a property with sweat, hard work, developing a DIY skillset, and self-managing tenants.