I personally believe the positives of FHA financing far outweigh the perceived liability exposure many caution of and its one of the few circumstances where I wholeheartedly believe investors should prioritize FHA financing over purchasing properties in an LLC. 

I post frequently about the unnecessary complexities of most real estate investors asset protection structures and the point I normally emphasize is the lack of attention placed on the day to day operations that are far more critical to reducing liability exposure.

I'd avoid doing this in units with shared ventilation as there is a potential risk of irritation to someone's lungs with prolonged exposure, especially if the person already has existing lung disease.Ozone machine will run about 60 bucks on Amazon.

@Will Mejia if you reinvest prior to the end of the calendar year into the right type of property where bonus depreciation is taken, you may be able to reduce your tax exposure partially or completely. 

You're likely better off hiring a discount broker to list the properties on the MLS for greater marketing exposure to bring in a bigger buyer pool. 

@Laurel WilliamsonWhat are you concerned about as exposure that insurance would not cover you for?

Let's break down the pros and cons of each approach:Forming an LLC in the State Where the Property is Located:Pros:Compliance with Local Laws: Establishing an LLC in the state where the property is situated ensures compliance with local regulations and laws specific to that jurisdiction.Legal Clarity: It provides clear legal jurisdiction and may simplify any legal proceedings related to the property in that state.Perception: Operating with a local LLC may give tenants and local authorities confidence in your commitment to the community.Cons:Additional Costs: Setting up and maintaining an LLC in another state means incurring additional registration fees, taxes, and possibly hiring local legal counsel.Administrative Burden: Managing multiple LLCs across different states adds complexity to your administrative workload, including extra paperwork and compliance requirements.Tax Implications: You may face tax obligations in both the state where the property is located and your home state, potentially leading to double taxation or complexities in tax filings.Managing Through Home State LLC:Pros:Simplified Management: Handling all properties under a single LLC streamlines administrative tasks, reducing paperwork and simplifying tax filings.Cost Savings: Avoiding the need to establish multiple LLCs in different states saves on registration fees, legal expenses, and ongoing maintenance costs.Consistency: Uniformity in management practices and legal structures may contribute to efficiency and ease of operation across your real estate portfolio.Cons:Legal Exposure: Operating out-of-state properties under a home state LLC may expose your personal assets to the laws and liabilities of the other state, potentially diminishing the liability protection the LLC offers.Compliance Challenges: You'll need to ensure your home state LLC meets the legal requirements for conducting business in other states, which could involve additional filings and fees.Perception and Credibility: Some tenants or local stakeholders may prefer dealing with a landlord who has a local presence, which could impact your reputation or relationships in the community.Ultimately, the decision depends on your specific circumstances, risk tolerance, and long-term goals.

I agree that gaining exposure is a good idea before moving on to the harder areas of investing.

If we're speaking of rentals in Houston, you'd certainly need to reach back and see what your wind exposure has been like over the past 10-20 years (if you can go back that far with good data) for this specific rental and area of the state. 

Not to mention a realtor has a larger pool of exposures to get your listing visibility.