I like this idea because it reduces the potential vacancy I could have by doing a short 3- to 4-month lease that ends in April or May, then starting over with a year lease.

Additionally, many states offer property tax exemptions, significantly reducing expenses.

I would also add, a contractor that you can buy materials for and they know how to put them in with little to know direction (reduces the management time of the project).

My agent is saying that we are unable to split the contract that way (or reduce the purchase price), so I'm trying to figure out options.

Step up in basis to reduce your heirs' taxes and morePlus the real estate tax "deferral" can end up being permanent if played correctly

The flat fee buyer agency fee reduces the amount of the buyer credit/refund, generally by $6,000 (although options range from $999 to $8999, depending on how much help the buyer wants from the agent).

The problem is that your debt payments are going to basically wipe out that $400K profit unless there is room to increase revenue or reduce expenses.

Yet, many investors overlook simple strategies that can significantly reduce their tax liability.

However, vacancy means covering 100% of the expenses.Multifamily properties almost always generate higher cash flow due to multiple income streams, which also reduces the risk of vacancies.

Just be mindful of the following things when it comes to California.California does not recognize Bonus DepreciationCalifornia does not recognize real estate professional status.Therefore, you can potentially reduce your Federal taxes but not your California taxes.