Quote from @Dean Sexton: There are benefits to both options.

And that BNB that just got 40% of their investment back is now competing with you, the small investor with a single condo that you paid full price for with no tax benefit. 

A CPA familiar with real estate partnerships could clarify the implications for everyone involved.A great attorney or CPA can help you iron out the details and ensure the partnership benefits all parties fairly.

@Zach Howard you pretty much MUST hold it in an LLC if you don't have the proper visa or greencard.1) Many attorneys over-hype the benefits of an LLC for each property.

If they get married it will help her earn SS benefits, etc etc. 

Additional DetailsI’m willing to invest in out-of-state properties, though I prefer areas with good property management options.My primary focus is passive income, but I’m also interested in value-add opportunities.I want to ensure these investments provide strong tax benefits and diversify my portfolio.I’d love to hear from experienced investors:What would you do in my position?

It will familiarize you with the basic terminology and benefits.

On buy-and holds we usually replace all the plumbing with pex, no matter what, because galvanized has a life expectation of about 60 years, so I usually take the sooner than later approach.Stick with hard money, like Mach1 or or MKE hard money (Scott Lurie) as they will not leand on a deal that does not pencil out, so you have the added benefit of someone experienced looking over your numbers.

One of the side benefits is that I can avoid the whole draw/inspection process (not overall inspection, just the ones tied to the draws) and don't have to worry about draw fees.

Overall, the tax benefits and appreciation alone keep me interested in staying with it more than the cash flow itself.