Also, just because you will be renting to S8 tenant does not reduce risk.....yes the tenant may be on a voucher and it will cover 70% at the least of the rent but the tenant quality will be low.

This resulted in longer times to re-rent and well as reducing the rental pool.

With that in mind, which approach do you think works best:1.Use property management software (PMS) as an intermediary to automate payments and fee splits while reducing legal risk and simplifying operations?

Although this is a long term investment and not in the main stream, it has added a certain level of comfort knowing the above potential investment risks are to a degree reduced.

My tax advisor referred me to them, and I also utilized cost segregation on the properties, which significantly reduced my tax bills.

Personally I’d stick with SFR or at 4 units or less for preferred financing and to reduce risk of the exchange failing.

Is there any creative way to avoid/reduce capital gains tax on the sale ?

Our business plan actually includes rehabbing distressed properties and conducting off-market transactions with owners currently occupying distressed properties using equity to reduce the out of pocket costs for the seller/buyer and to simplify the process.

What are some pros that I can highlight from the seller’s perspective.Here are a few that I’ve come up with:1) monthly income at a higher interest rate;2) avoiding a larger tax bill by reducing the purchase price (on paper);3) a promissory note that they could potentially sell down the road.Any other major ones I am missing?

However, these costs can often be added to your property's basis, which helps reduce capital gains tax when you sell the home.Once the property is officially a short-term rental, subsequent repairs and maintenance would likely qualify as deductible expenses.