In the Reno, NV market prices are continuing to rise because there is still a shortage of housing supply and there are very few building start. 

There are certain areas of the upper Midwest that have significant housing shortages...

If you are in the Kansas City Metro area in specific, note that Overland Park is considering banning STR or creating a licensing program - I guess they have nothing right now.Kansas City Missouri's auditor told them to petition the state to change law so they can tax and fee as hotels and to make their licensing program more streamlined and easier to enforce as only 7% of STR are permitted.We have several articles on our REIA's blog.And no matter where you are, these are probably the same issues you may be facing as cities far and wide are working to limit STR as there is a shortage of regular rentals.

If the home doesn't sell for enough to settle the entire balance, the FHA insurance fund (assuming it's an FHA HECM, which it likely is) makes up the shortage.

It sounds to me like the tenant miscalculated or overspent on something else and tried to make up for the shortage in funds by marking that payment as fraud. 

The money made out of forced appreciation may not be worth it for most people, but as a guy who also loves some sweat equity there are no shortages of properties on the outskirts of Raleigh that are distressed and are under market value.

I can barely get firms to look at columbus with 10x years of experience thats mostly for ground up. the average house cost is still less than 100k which means you have a lot of houses to tear down still to create a housing shortage. the economics don't make it favorable for any type of investing but turn key or maybe ground up in the urban core which works in any city. but compare any of these cities, I'll take Indianapolis, Chicago, Minneapolis, and columbus and Milwaukee and pass on the rest. 

For future years, we probably wouldn't meet the 500 hours test (though we still do participate a significant amount as we periodically re-stock supplies at the place, handle most maintenance issues due to shortage of workers in the town, and monitor sensors during guest stays - leak sensors/heat/stove).Specific Questions on Depreciation:Assuming that I have the qualifications for non-passive activity, I then have some questions on bonus depreciation and related stuff.5) It is my understanding that Qualified Improvement Property (QIP) bonus depreciation is probably not useful for me because I did most of the renovations prior to placing the property in-service (save for a few things).

There is also a severe shortage of weekly rentals in the winter, since most condos require full month rentals then.

With an ongoing housing shortage, I don't believe that even a correct prediction from your consultant about the rate of new housing starts would significantly impact the market.