I know its not a huge spread but like I said I wanted to try something new.Hey Jonah, Congrats on a good deal, to only need a few cosmetic touches and to get that nice little bounce in value is awesome.And 7% is probably a pretty solid estimate (usually based on FICO) but I think the important question that you are asking is what is your long term strategy with it?

We have done this multiple times as long as both properties are rentals it shouldn't be no problem.   

I’ve been in this business a long time, and I know firsthand how overwhelming that first deal can feel—especially when it comes to financing.

Since they've lived there so long, I recommend giving them 60 days to move as a means of softening the blow.Third, don't negotiate or accept excuses.

Terms are not going to be super aggressive due to the fact that the rehab amount is larger than the purchase price though.

I am still trying to figure out my buy box, but long term rentals feels like the right strategy for us.   

I haven't been in Detroit long but I've gained quite a bit of knowledge there about the section 8 and housing markets there in general.

So long as you can keep it occupied and drive up your base rent over time, your property will appreciate and you will maintain (and increase) your equity. 

But here are ways to reduce capital gains taxes:Deduct expenses (renovation, selling costs) in 2024 to offset gains.Hold for 1+ year to qualify for lower long-term capital gains tax rates.Invest in a Qualified Opportunity Fund (QOF) to defer taxes.Use tax-loss harvesting to offset gains with investment losses.Pushing 2024 deductions to 2025 won’t help much with 2024 capital gains.

There are only 2 ways, as I see it in the current market, to get actual income/cash flow from a rental property - a paid off long term/mid term property or a well bought short term or rent by the room rental.