The best deals I find are usually the result of an agent’s lack of familiarity with the area or a very poor listing presentation.

I love their youtube channel as well that produces 2 or 3 videos a week. 

If you are prepared for the costs involved and the modifications needed to the property to make the basement unit conform, the pay off of creating an extra rent producing unit is huge. 

I think it is just as indisputable that higher cost markets will produce greater value add via a proper rehab.Next question is does initial cash flow have any correlation to actual cash flow over a long hold. 

The home office deduction cannot increase your passive losses:You can only deduct home office expenses up to your net rental incomeIf your rentals are already showing a loss, the home office deduction won't helpExcess deductions carry forward to future yearsMust apply §280A limitations first, then passive loss rulesExample: 🔢Rental Income: $24,000Regular Rental Expenses: -$20,000Net Before Home Office: $4,000Home Office Expenses: $3,000 [using allocations, not the Simplified Method]Result: Can deduct full home officeCounter Example: 🔢Rental Income: $24,000Regular Rental Expenses: -$26,000Net Before Home Office: -$2,000 (Loss)Home Office Expenses: $3,000Result: No home office deduction this year (carries forward)Reality Check: 🤔Let's be honest - while technically you need to:Calculate net rental incomeApply §280A limitations [Consult your CPA on this!]

In lower-value areas like Sylmar, market values max out around $3.28 million, which results in a loss.The key takeaway?

This is because the dwindling cash flow due to the increased rates has resulted in higher cap rates.  

Many of them treat the home as their own and stay long term.Multi's are nice because they generally produce more cash flow, but do require some extra attention.

I was aware of the needed updates, but not aware of the age of the roof, HVAC, and substandard electrical until I got the inspection results. 

Google provides an AI summary of search results that is usually good enough for a general question, but I would never give any AI a detailed tax scenario and just run with whatever answer it gave me.