I'm a Realtor with a couple properties listed in Boise, ID and a neighboring town for my investor/client that are currently rented as co-living or rent-by-the-room and getting killer income. (7.3% - 9.5% Cap rate) So far, every inquiry has been baffled by the concept of co-living or rent-by-the-room and immediately ask if they're being run as a halfway-house (which they are not).

We rent to plenty of S8 applicants; I've always believed the standard of care they exude is as high if not higher than "market" applicants because they'll get kicked out of the program if they don't.

@Fulati PaerhatiRecommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

I a factoring in the replacement of the AC unit and potentially the water heater, and the cosmetic thins (I would do myself) to get it to rentable standard.

It is standard practice and component level depreciation is encouraged by the IRS.Though it is very important to track you time as you go along.

LTRs with long term conventional financing and standard management aren't really cash flowing anywhere right now. sure, there are lower cost markets that look better on paper, but there are costs associated with those supposedly cheap markets as well - deferred maintenance, more challenging tenant base, higher cost turnovers as a percentage of the rent.2. i wouldn't pick a random market thousands of miles away based solely on statistics or numbers. 

This means that if you pay off the loan too early, then you'll pay a 1-5% fee off the loan amount. paying off the loan early means you either refinance or you sell the property, both would trigger a prepayment penalty to the lender. that being said, you can choose your prepay options, 5yr usually giving you a better interest rate by like a 0.25%, 3yr being most common and standard, and a 0,1,2 yr where you can buy down the prepay to be less years. meaning you pay 1% upfront of the loan amount to get a 1yr prepayment penalty so you're free to sell the property or refi after 1yr. 

@Thomas FarrellRecommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

More about the concept of STR tax savings is here:https://www.biggerpockets.com/forums/51/topics/1122635-the-s...As to one CPA saying that your losses would still be passive, we cannot comment.

I ended up backing down and just use the standard payment platforms, Venmo, MetaPay, CashApp, and Zelle.