Rental real estate is generally not SE income.I may be biased, but IMO the surest way to mitigate your tax liability and navigate the waters so to speak is to retain a tax professional as an external partner on your team.

The main hurdles are having the sufficient capacity with utilities (water, sewer, electric) off-street parking, appropriate setbacks, and fire mitigation (if you have 3 units you are likely going to be required to have one of them sprinkled). 

Good deals aren't obviously easy to find.I'm trying to decide if I should :a) just be patient in my chosen market and wait for the right BRRRR deal even if it takes monthsb) also look for a small MFR (my #2 strategy choice) so I can start investing while waiting for the right BRRRR dealc) expand my market into a 2nd location (I'm out of state and like my initial market as it's backed by good metrics and I have family in the area which can help mitigate some of the risks of out of state investing).I'm leaning towards looking for a duplex as it won't prevent me from buying a good BRRRR.

It's all about mitigating risks.

I'd like to learn more about the risks associated with this type of investing and how to mitigate them.

Another way the additional cost is sometimes mitigated is that contractors and suppliers are paid more reliably and therefore the process sometimes goes smoother and there are perhaps less change orders or delays - both of which are costly.  

You slightly mitigate your risk and you get exposure to more deals for learning.Check out platform reviews at https://www.therealestatecrowdfundingreview.com/

It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.Make sure your property manager is a licensed real estate brokerage.Google Clayton Morris Fraud and/or Morris Invest Fraud for a cautionary tale of what not to do when buying turnkey real estateUnderstand you can not eliminate all risk, only mitigate it.

Your return in dollars is less, but this is mitigated by keeping your money working.

It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.Make sure your property manager is a licensed real estate brokerage.Google Clayton Morris lawsuits and/or Morris Invest lawsuits for a cautionary tale of what not to do when buying turnkey real estateUnderstand you can not eliminate all risk, only mitigate it.